(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~November 12, 2019,~~August 11, 2020, there were ~~51,215,255~~52,227,775 outstanding shares of Class A common stock and ~~7,666,317~~7,818,047 outstanding shares of Class T common stock of the registrant.

Certain statements contained in this Form 10-Q of SmartStop Self Storage REIT, Inc., other than historical facts, may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend for all such forward-looking statements to be covered by the applicable safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act, as applicable. Such statements include, in particular, statements about our plans, strategies, and prospects and are subject to certain risks and uncertainties, including known and unknown risks, which could cause actual results to differ materially from those projected or anticipated. Therefore, such statements are not intended to be a guarantee of our performance in future periods. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “seek,” “continue,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date this report is filed with the Securities and Exchange Commission. We cannot guarantee the accuracy of any such forward-looking statements contained in this Form 10-Q, and we do not intend to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Any such forward-looking statements are subject to risks, uncertainties, and other factors and are based on a number of assumptions involving judgments with respect to, among other things, future economic, competitive, and market conditions, ~~all~~including without limitation, changes in the political and economic climate, economic conditions and fiscal imbalances in the United States, and other major developments, including wars, natural disasters, epidemics and pandemics, including the outbreak of ~~which are~~novel coronavirus (COVID-19), military actions, and terrorist attacks. The occurrence or severity of any such event or circumstance is difficult or impossible to predict accurately. To the extent that our assumptions differ from actual results, our ability to meet such forward-looking statements, including our ability to generate positive cash flow from operations and provide distributions to stockholders, and our ability to find suitable investment properties, may be significantly hindered. ~~See~~

For further information regarding risks and uncertainties associated with our business, and important factors that could cause our actual results to vary materially from those expressed or implied in such forward-looking statements, please refer to the ~~risk~~ factors ~~identified in~~listed and described under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the “Risk Factors” ~~section~~sections of the documents we file from time to time with the U.S. Securities and Exchange Commission, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, ~~2018,~~2019, as filed with the Securities and Exchange Commission, as supplemented by the risk factors included in Part II, Item 1A of this Form ~~10-Q, for a discussion of some, although not all, of the risks and uncertainties that could cause actual results to differ materially from those presented in our forward-looking statements.~~10-Q.

The information furnished in the accompanying unaudited consolidated balance sheets and related consolidated statements of operations, comprehensive loss, equity and cash flows reflects all adjustments (consisting of normal and recurring adjustments) that are, in management’s opinion, necessary for a fair and consistent presentation of the aforementioned consolidated financial statements.

The accompanying consolidated financial statements should be read in conjunction with the notes to our consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this report on Form 10-Q. The accompanying consolidated financial statements should also be read in conjunction with our consolidated financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019. Our results of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020, are not necessarily indicative of the operating results expected for the full year.

	September 30, 2019 (Unaudited)			December 31, 2018			June 30, 2020 (Unaudited)			December 31, 2019
ASSETS
Real estate facilities:
Land	$	331,686,724		$	269,522,776		$	330,552,878		$	332,350,688
Buildings		776,448,040			507,580,145			790,712,015			780,969,455
Site improvements		60,061,992			43,193,105			62,655,552			60,505,225
		1,168,196,756			820,296,026			1,183,920,445			1,173,825,368
Accumulated depreciation		(75,946,886	)		(54,264,685	)		(98,435,981	)		(83,692,491	)
		1,092,249,870			766,031,341			1,085,484,464			1,090,132,877
Construction in process		10,101,266			130,383			932,368			12,237,722
Real estate facilities, net		1,102,351,136			766,161,724			1,086,416,832			1,102,370,599
Real estate held for sale, net		11,777,915			—
Cash and cash equivalents		14,088,581			10,272,020			49,952,383			62,279,757
Restricted cash		7,845,349			3,740,188			8,102,770			6,291,366
Investments in and advances to Managed REITs		5,916,084			—			1,615,664			6,072,399
Other assets, net		5,939,392			14,580,417			7,170,160			6,318,037
Debt issuance costs, net of accumulated amortization		—			36,907
Intangible assets, net of accumulated amortization		33,627,666			1,562,781
Trademarks, net of accumulated amortization		19,743,167			—
Intangible assets, net								14,760,842			30,040,426
Trademarks								16,264,706			19,688,167
Goodwill		78,372,980			—			53,643,331			78,372,980
Total assets	$	1,279,662,270		$	796,354,037		$	1,237,926,688		$	1,311,433,731
LIABILITIES AND EQUITY
Debt, net	$	815,319,158		$	406,084,103		$	710,116,684		$	712,733,002
Accounts payable and accrued liabilities		20,906,799			7,691,990			23,260,173			18,576,230
Due to affiliates		1,442,030			2,203,837			984,467			1,624,474
Distributions payable		3,326,601			2,890,395			5,868,759			5,159,105
Contingent earnout		31,200,000			—			24,400,000			31,100,000
Deferred tax liability		7,006,005			—
Deferred tax liabilities								3,586,458			6,609,571
Total liabilities		879,200,593			418,870,325			768,216,541			775,802,382
Commitments and contingencies (Note 11)
Commitments and contingencies (Note 13)
Redeemable common stock		39,839,496			32,226,815			51,374,754			43,391,362
Preferred Stock, $0.001 par value; 200,000,000 shares authorized:
Series A Convertible Preferred Stock, $0.001 par value; 200,000 shares authorized; 150,000 shares issued and outstanding at June 30, 2020 and December 31, 2019, with aggregate liquidation preferences of $152,383,940, and $151,665,753 at June 30, 2020 and December 31, 2019, respectively								146,379,708			146,426,164
Equity:
SmartStop Self Storage REIT, Inc. equity:
Preferred stock, $0.001 par value; 200,000,000 shares authorized; NaN issued and outstanding at September 30, 2019 and December 31, 2018		—			—
Class A common stock, $0.001 par value; 350,000,000 shares authorized; 51,148,541 and 50,437,059 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively		51,149			50,437
Class T common stock, $0.001 par value; 350,000,000 shares authorized; 7,649,856 and 7,533,790 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively		7,650			7,534
Class A common stock, $0.001 par value; 350,000,000 shares authorized; 52,118,882 and 51,435,124 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively								52,119			51,435
Class T common stock, $0.001 par value; 350,000,000 shares authorized; 7,801,216 and 7,699,893 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively								7,801			7,700
Additional paid-in capital		491,272,437			500,474,807			491,870,566			491,433,240
Distributions		(119,904,285	)		(94,248,326	)		(146,094,279	)		(128,642,787	)
Accumulated deficit		(81,658,982	)		(62,340,153	)		(130,655,858	)		(87,090,486	)
Accumulated other comprehensive income (loss)		(3,172,074	)		1,390,354
Accumulated other comprehensive loss								(6,096,431	)		(1,955,335	)
Total SmartStop Self Storage REIT, Inc. equity		286,595,895			345,334,653			209,083,918			273,803,767
Noncontrolling interests in our Operating Partnership		74,004,486			(77,756	)		62,849,967			71,988,256
Other noncontrolling interests		21,800			—			21,800			21,800
Total noncontrolling interests		74,026,286			(77,756	)		62,871,767			72,010,056
Total equity		360,622,181			345,256,897			271,955,685			345,813,823
Total liabilities and equity	$	1,279,662,270		$	796,354,037		$	1,237,926,688		$	1,311,433,731

	Three Months Ended September 30,						Nine Months Ended September 30,						Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018			2020			2019			2020			2019
Revenues:
Self storage rental revenue	$	25,669,615		$	19,796,139		$	74,056,235		$	58,784,034		$	24,946,793		$	25,154,971		$	50,514,812		$	48,386,620
Ancillary operating revenue		1,188,934			516,930			2,589,985			1,441,008			1,183,418			749,375			2,336,261			1,401,051
Managed REIT Platform revenue		1,192,665			—			1,221,727			—			1,852,893			29,062			3,636,680			29,062
Reimbursable costs from Managed REITs		1,536,800			—			1,583,909			—			1,486,441			47,109			3,279,915			47,109
Total revenues		29,588,014			20,313,069			79,451,856			60,225,042			29,469,545			25,980,517			59,767,668			49,863,842
Operating expenses:
Property operating expenses		9,655,599			6,416,687			26,630,201			18,637,792			9,195,043			8,775,557			18,870,069			16,974,602
Property operating expenses – affiliates		—			2,571,670			6,605,670			7,687,183			—			3,380,954			—			6,605,670
Managed REIT Platform expenses		1,248,665			—			1,259,234			—			1,008,014			10,569			2,182,823			10,569
Reimbursable costs from Managed REITs		1,536,800			—			1,583,909			—			1,486,441			47,109			3,279,915			47,109
General and administrative		3,519,557			999,439			7,000,627			3,632,649			4,149,713			1,826,886			7,817,660			3,481,070
Depreciation		7,639,190			5,097,944			21,928,108			15,245,530			7,842,443			7,420,510			15,559,114			14,288,918
Intangible amortization expense		3,741,046			179,613			7,822,354			2,398,378			3,218,152			2,354,332			6,887,783			4,081,308
Contingent earnout expense		300,000			—			300,000			—
Self administration transaction expenses		107,100			—			1,595,371			—			—			1,350,188			—			1,488,271
Acquisition expenses – affiliates		—			16,422			84,061			42,642			—			45,119			—			84,061
Other property acquisition expenses		25,529			554,661			109,765			808,091
Other acquisition expenses														97,221			387			125,326			84,236
Contingent earnout adjustment														500,000			—			(6,700,000	)		—
Impairment of goodwill and intangible assets														—			—			36,465,732			—
Impairment of investments in Managed REITs														—			—			4,376,879			—
Total operating expenses		27,773,486			15,836,436			74,919,300			48,452,265			27,497,027			25,211,611			88,865,301			47,145,814
Operating income		1,814,528			4,476,633			4,532,556			11,772,777
Operating income (loss)														1,972,518			768,906			(29,097,633	)		2,718,028
Other income (expense):
Interest expense		(10,260,936	)		(4,587,573	)		(28,584,740	)		(13,417,041	)		(8,284,429	)		(9,762,302	)		(16,623,732	)		(18,323,804	)
Interest expense – accretion of fair market value of secured debt		33,191			111,383			98,850			336,894			32,892			33,191			65,549			65,659
Interest expense – debt issuance costs		(1,082,543	)		(330,639	)		(2,997,801	)		(975,591	)		(936,278	)		(1,073,725	)		(1,879,761	)		(1,915,258	)
Net loss on extinguishment of debt		—		��	—			(1,487,867	)		—			—			—			—			(1,487,867	)
Gain resulting from acquisition of unconsolidated affiliates		—			—			8,017,353			—			—			8,017,353			—			8,017,353
Other		(45,819	)		(127,082	)		(352,219	)		(278,694	)		152,456			(267,395	)		2,729,155			(306,401	)
Net loss		(9,541,579	)		(457,278	)		(20,773,868	)		(2,561,655	)		(7,062,841	)		(2,283,972	)		(44,806,422	)		(11,232,290	)
Net loss attributable to the noncontrolling Interests in our Operating Partnership		1,326,753			5,854			1,455,039			21,972
Net loss attributable to the noncontrolling interests in our Operating Partnership														933,443			71,527			5,965,095			128,286
Less: Distributions to preferred stockholders														(2,362,023	)		—			(4,724,045	)		—
Net loss attributable to SmartStop Self Storage REIT, Inc. common stockholders	$	(8,214,826	)	$	(451,424	)	$	(19,318,829	)	$	(2,539,683	)	$	(8,491,421	)	$	(2,212,445	)	$	(43,565,372	)	$	(11,104,004	)
Net loss per Class A share – basic and diluted	$	(0.14	)	$	(0.01	)	$	(0.33	)	$	(0.04	)	$	(0.14	)	$	(0.04	)	$	(0.74	)	$	(0.19	)
Net loss per Class T share – basic and diluted	$	(0.14	)	$	(0.01	)	$	(0.33	)	$	(0.04	)	$	(0.14	)	$	(0.04	)	$	(0.74	)	$	(0.19	)
Weighted average Class A shares outstanding – basic and diluted		50,789,174			49,948,074			50,650,524			49,732,757			51,622,509			50,679,825			51,469,807			50,603,703
Weighted average Class T shares outstanding – basic and diluted		7,626,158			7,461,101			7,584,645			7,418,129			7,776,128			7,581,180			7,764,393			7,563,544

Common Stock

Class A

Class T

Number
of Shares

Common
Stock
Par Value

Number
of Shares

Common
Stock
Par Value

Additional
Paid-in
Capital

Distributions

Accumulated
Deficit

Accumulated
Other
Comprehensive
Income

Total
SmartStop Self Storage REIT,
Inc. Equity

Noncontrolling
Interests

Total
Equity

Redeemable
Common
Stock

Balance as of December 31, 2017

49,386,092

$
49,386

7,350,142

$
7,351

$
496,287,890

$
(60,561,504
)

$
(58,641,776
)

$
1,369,208

$
378,510,555

$
4,427,469

$
382,938,024

$
24,497,059

Offering costs

—

—

—

—

(1,973
)

—

—

—

(1,973
)

—

(1,973
)

—

Changes to redeemable common stock

—

—

—

—

(3,970,960
)

—

—

—

(3,970,960
)

—

(3,970,960
)

3,970,960

Redemptions of common stock

(69,411
)

(69
)

(2,640
)

(3
)

—

—

—

—

(72
)

—

(72
)

(1,126,591
)
Distributions

—

—

—

—

—

(8,238,414
)

—

—

(8,238,414
)

—

(8,238,414
)

—

Distributions to noncontrolling interests

—

—

—

—

—

—

—

—

—

(74,446
)

(74,446
)

—

Issuance of shares for distribution
   reinvestment plan

337,155

337

51,602

52

3,970,960

—

—

—

3,971,349

—

3,971,349

—

Stock compensation expense

—

—

—

—

14,968

—

—

—

14,968

—

14,968

—

Net loss attributable to SmartStop Self
   Storage REIT, Inc.

—

—

—

—

—

—

(661,203
)

—

(661,203
)

—

(661,203
)

—

Net loss attributable to the noncontrolling
   interests in our Operating Partnership

—

—

—

—

—

—

—

—

—

(5,844
)

(5,844
)

—

Foreign currency translation adjustment

—

—

—

—

—

—

—

(2,059,805
)

(2,059,805
)

—

(2,059,805
)

—

Foreign currency forward contract gains

—

—

—

—

—

—

—

2,073,290

2,073,290

—

2,073,290

—

Interest rate swap and cap contract gains

—

—

—

—

—

—

—

437,629

437,629

—

437,629

—

Balance as of March 31, 2018

49,653,836

49,654

7,399,104

7,400

496,300,885

(68,799,918
)

(59,302,979
)

1,820,322

370,075,364

4,347,179

374,422,543

27,341,428

Offering costs

—

—

—

—

(2,357
)

—

—

—

(2,357
)

—

(2,357
)

—

Changes to redeemable common stock

—

—

—

—

(4,031,062
)

—

—

—

(4,031,062
)

—

(4,031,062
)

4,031,062

Redemptions of common stock

(109,624
)

(110
)

(12,499
)

(12
)

—

—

—

—

(122
)

—

(122
)

(1,212,332
)
Issuance of restricted stock

10,500

11

—

—

—

—

—

—

11

—

11

—

Distributions

—

—

—

—

—

(8,370,146
)

—

—

(8,370,146
)

—

(8,370,146
)

—

Distributions to noncontrolling interests

—

—

—

—

—

—

—

—

—

(75,273
)

(75,273
)

—

Issuance of shares for distribution
   reinvestment plan

332,758

333

51,178

51

4,031,062

—

—

—

4,031,446

—

4,031,446

—

Stock compensation expense

—

—

—

—

14,968

—

—

—

14,968

—

14,968

—

Net loss attributable to SmartStop Self
   Storage REIT, Inc.

—

—

—

—

—

—

(1,427,056
)

—

(1,427,056
)

—

(1,427,056
)

—

Net loss attributable to the noncontrolling
   interests in our Operating Partnership

—

—

—

—

—

—

—

—

—

(10,274
)

(10,274
)

—

Foreign currency translation adjustment

—

—

—

—

—

—

—

(1,344,967
)

(1,344,967
)

—

(1,344,967
)

—

Foreign currency forward contract gains

—

—

—

—

—

—

—

1,441,209

1,441,209

—

1,441,209

—

Interest rate swap and cap contract gains

—

—

—

—

—

—

—

71,903

71,903

—

71,903

—

Balance as of June 30, 2018

49,887,470

49,888

7,437,783

7,439

496,313,496

(77,170,064
)

(60,730,035
)

1,988,467

360,459,191

4,261,632

364,720,823

30,160,158

Offering costs

—

—

—

—

(11,034
)

—

—

—

(11,034
)

—

(11,034
)

—

Changes to redeemable common stock

—

—

—

—

(4,039,502
)

—

—

—

(4,039,502
)

—

(4,039,502
)

4,039,502

Redemptions of common stock

(125,637
)

(126
)

(3,376
)

(4
)

—

—

—

—

(130
)

—

(130
)

(4,639,876
)
Distributions

—

—

—

—

—

(8,499,843
)

—

—

(8,499,843
)

—

(8,499,843
)

—

Distributions to noncontrolling
   interests

—

—

—

—

—

—

—

—

—

(76,100
)

(76,100
)

—

Issuance of shares for distribution
   reinvestment plan

328,859

329

50,473

50

4,039,502

—

—

—

4,039,881

—

4,039,881

—

Stock compensation expense

—

—

—

—

23,400

—

—

—

23,400

—

23,400

—

Net loss attributable to SmartStop Self
   Storage REIT, Inc.

—

—

—

—

—

—

(451,424
)

—

(451,424
)

—

(451,424
)

—

Net loss attributable to the noncontrolling
   interests in our Operating Partnership

—

—

—

—

—

—

—

—

—

(5,854
)

(5,854
)

—

Foreign currency translation adjustment

—

—

—

—

—

—

—

1,343,450

1,343,450

—

1,343,450

—

Foreign currency forward contract gains

—

—

—

—

—

—

—

(1,083,267
)

(1,083,267
)

—

(1,083,267
)

—

Interest rate swap and cap contract gains

—

—

—

—

—

—

—

(5,139
)

(5,139
)

—

(5,139
)

—

Balance as of September 30, 2018

50,090,692

$
50,091

7,484,880

$
7,485

$
496,325,862

$
(85,669,907
)

$
(61,181,459
)

$
2,243,511

$
351,775,583

$
4,179,678

$
355,955,261

$
29,559,784

	Common Stock
	Class A						Class T
	Number of Shares			Common Stock Par Value			Number of Shares			Common Stock Par Value			Additional Paid-in Capital			Distributions			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total SmartStop Self Storage REIT, Inc. Equity			Noncontrolling Interests			Total Equity			Preferred Equity		Redeemable Common Stock
Balance as of December 31, 2018		50,437,059		$	50,437			7,533,790		$	7,534		$	500,474,807		$	(94,248,326	)	$	(62,340,153	)	$	1,390,354		$	345,334,653		$	(77,756	)	$	345,256,897		$	—	$	32,226,815
Offering costs		—			—			—			—			(2,418	)		—			—			—			(2,418	)		—			(2,418	)		—		—
Issuance of limited partnership units in our Operating Partnership in connection with the SSGT Mergers		—			—			—			—			—			—			—			—			—			4,217,399			4,217,399			—		—
Changes to redeemable common stock		—			—			—			—			(3,963,393	)		—			—			—			(3,963,393	)		—			(3,963,393	)		—		3,963,393
Redemptions of common stock		(120,000	)		(120	)		(21,291	)		(21	)		—			—			—			—			(141	)		—			(141	)		—		(2,044,001	)
Distributions		—			—			—			—			—			(8,411,426	)		—			—			(8,411,426	)		—			(8,411,426	)		—		—
Distributions to noncontrolling interests		—			—			—			—			—			—			—			—			—			(46,584	)		(46,584	)		—		—
Issuance of shares for distribution reinvestment plan		322,580			323			49,604			50			3,963,393			—			—			—			3,963,766			—			3,963,766			—		—
Equity based compensation expense		—			—			—			—			21,957			—			—			—			21,957			—			21,957			—		—
Net loss attributable to SmartStop Self Storage REIT, Inc. common stockholders		—			—			—			—			—			—			(8,891,558	)		—			(8,891,558	)		—			(8,891,558	)		—		—
Net loss attributable to the noncontrolling interests in our Operating Partnership		—			—			—			—			—			—			—			—			—			(56,759	)		(56,759	)		—		—
Foreign currency translation adjustment		—			—			—			—			—			—			—			867,261			867,261			—			867,261			—		—
Foreign currency forward contract loss		—			—			—			—			—			—			—			(846,581	)		(846,581	)		—			(846,581	)		—		—
Interest rate swap and cap contract loss		—			—			—			—			—			—			—			(1,315,092	)		(1,315,092	)		—			(1,315,092	)		—		—
Balance as of March 31, 2019		50,639,639		$	50,640			7,562,103		$	7,563		$	500,494,346		$	(102,659,752	)	$	(71,231,711	)	$	95,942		$	326,757,028		$	4,036,300		$	330,793,328		$	—	$	34,146,207

	Common Stock
	Class A						Class T
	Number of Shares			Common Stock Par Value			Number of Shares			Common Stock Par Value			Additional Paid-in Capital			Distributions			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total SmartStop Self Storage REIT, Inc. Equity			Noncontrolling Interests			Total Equity			Preferred Equity		Redeemable Common Stock
Balance as of March 31, 2019		50,639,639		$	50,640			7,562,103		$	7,563		$	500,494,346		$	(102,659,752	)	$	(71,231,711	)	$	95,942		$	326,757,028		$	4,036,300		$	330,793,328		$	—	$	34,146,207
Offering costs		—			—			—			—			(1,559	)		—			—			—			(1,559	)		—			(1,559	)		—		—
Issuance of limited partnership units in our Operating Partnership in connection with the Self Administration Transaction		—			—			—			—			—			—			—			—			—			63,643,000			63,643,000			—		—
Issuance of limited partnership units in our Operating Partnership in exchange for special limited partnership interest		—			—			—			—			9,687,035			—			—			—			9,687,035			9,112,965			18,800,000			—		—
Contribution of special limited partnership interest in exchange for limited partnership interests in our Operating Partnership		—			—			—			—			(18,800,000	)		—			—			—			(18,800,000	)		—			(18,800,000	)		—		—
Noncontrolling interests related to the consolidated Tenant Programs joint ventures		—			—			—			—			—			—			—			—			—			21,800			21,800			—		—
Redemption of limited partnership interests held by our Former Advisor		—			—			—			—			(291,103	)		—			—			—			(291,103	)		91,103			(200,000	)		—		—
Changes to redeemable common stock		—			—			—			—			(4,049,066	)		—			—			—			(4,049,066	)		—			(4,049,066	)		—		4,049,066
Redemptions of common stock		(199,883	)		(200	)		(10,242	)		(11	)		—			—			—			—			(211	)		—			(211	)		—		(2,052,078	)
Issuance of restricted stock		232,176			232			—			—			—			—			—			—			232			—			232			—		—
Distributions		—			—			—			—			—			(8,533,201	)		—			—			(8,533,201	)		—			(8,533,201	)		—		—
Distributions to noncontrolling interests		—			—			—			—			—			—			—			—			—			(105,140	)		(105,140	)		—		—
Issuance of shares for distribution reinvestment plan		328,392			328			50,757			50			4,049,066			—			—			—			4,049,444			—			4,049,444			—		—
Equity based compensation expense		—			—			—			—			25,136			—			—			—			25,136			—			25,136			—		—
Net loss attributable to SmartStop Self Storage REIT, Inc.		—			—			—			—			—			—			(2,212,445	)		—			(2,212,445	)		—			(2,212,445	)		—		—
Net loss attributable to the noncontrolling interests in our Operating Partnership		—			—			—			—			—			—			—			—			—			(71,527	)		(71,527	)		—		—
Foreign currency translation adjustment		—			—			—			—			—			—			—			1,192,459			1,192,459			—			1,192,459			—		—
Foreign currency forward contract loss		—			—			—			—			—			—			—			(1,039,585	)		(1,039,585	)		—			(1,039,585	)		—		—
Interest rate swap and cap contract loss		—			—			—			—			—			—			—			(1,861,933	)		(1,861,933	)		—			(1,861,933	)		—		—
Balance as of June 30, 2019		51,000,324		$	51,000			7,602,618		$	7,602		$	491,113,855		$	(111,192,953	)	$	(73,444,156	)	$	(1,613,117	)	$	304,922,231		$	76,728,501		$	381,650,732		$	—	$	36,143,195

	Common Stock
	Class A						Class T
	Number of Shares			Common Stock Par Value			Number of Shares		Common Stock Par Value		Additional Paid-in Capital			Distributions			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total SmartStop Self Storage REIT, Inc. Equity			Noncontrolling Interests			Total Equity			Preferred Equity			Redeemable Common Stock
Balance as of December 31, 2019		51,435,124		$	51,435			7,699,893	$	7,700	$	491,433,240		$	(128,642,787	)	$	(87,090,486	)	$	(1,955,335	)	$	273,803,767		$	72,010,056		$	345,813,823		$	146,426,164		$	43,391,362
Offering costs		—			—			—		—		(28,822	)		—			—			—			(28,822	)		—			(28,822	)		—			—
Preferred equity issuance costs		—			—			—		—		—			—			—			—			—			—			—			(46,456	)		—
Changes to redeemable common stock		—			—			—		—		(3,979,539	)		—			—			—			(3,979,539	)		—			(3,979,539	)		—			3,979,539
Redemptions of common stock		(42,040	)		(42	)		—		—		—			—			—			—			(42	)		—			(42	)		—			—
Issuance of restricted stock		47,842			48			—		—		—			—			—			—			48			—			48			—			—
Distributions		—			—			—		—		—			(8,668,726	)		—			—			(8,668,726	)		—			(8,668,726	)		—			—
Distributions to noncontrolling interests		—			—			—		—		—			—			—			—			—			(1,356,799	)		(1,356,799	)		—			—
Issuance of shares for distribution reinvestment plan		322,411			322			50,046		50		3,979,167			—			—			—			3,979,539			—			3,979,539			—			—
Equity based compensation expense		—			—			—		—		219,603			—			—			—			219,603			—			219,603			—			—
Net loss attributable to SmartStop Self Storage REIT, Inc. common stockholders		—			—			—		—		—			—			(35,073,951	)		—			(35,073,951	)		—			(35,073,951	)		—			—
Net loss attributable to the noncontrolling interests in our Operating Partnership		—			—			—		—		—			—			—			—			—			(5,031,652	)		(5,031,652	)		—			—
Foreign currency translation adjustment		—			—			—		—		—			—			—			(3,959,904	)		(3,959,904	)		(607,216	)		(4,567,120	)		—			—
Foreign currency forward contract gain		—			—			—		—		—			—			—			3,959,594			3,959,594			607,201			4,566,795			—			—
Interest rate swap and cap contract loss		—			—			—		—		—			—			—			(4,747,520	)		(4,747,520	)		(728,029	)		(5,475,549	)		—			—
Balance as of March 31, 2020		51,763,337		$	51,763			7,749,939	$	7,750	$	491,623,649		$	(137,311,513	)	$	(122,164,437	)	$	(6,703,165	)	$	225,504,047		$	64,893,561		$	290,397,608		$	146,379,708		$	47,370,901

Common Stock

Class A

Class T

Number
of Shares

Common
Stock
Par Value

Number
of Shares

Common
Stock
Par Value

Additional
Paid-in
Capital

Distributions

Accumulated
Deficit

Accumulated
Other
Comprehensive
Income (Loss)

Total
SmartStop Self Storage REIT,
Inc. Equity

Noncontrolling
Interests

Total
Equity

Redeemable
Common
Stock

Balance as of March 31, 2019

50,639,639

$
50,640

7,562,103

$
7,563

$
500,494,346

$
(102,659,752
)

$
(71,231,711
)

$
95,942

$
326,757,028

$
4,036,300

$
330,793,328

$
34,146,207

Offering costs

—

—

—

—

(1,559
)

—

—

—

(1,559
)

—

(1,559
)

—

Issuance of limited partnership units in our
   Operating Partnership in connection with
   the Self Administration Transaction

—

—

—

—

—

—

—

—

—

63,643,000

63,643,000

—

Issuance of limited partnership units in our
   Operating Partnership in exchange for
   special limited partnership interest

—

—

—

—

9,687,035

—

—

—

9,687,035

9,112,965

18,800,000

—

Contribution of special limited partnership
   interest in exchange for limited partnership
   interests in our Operating Partnership

—

—

—

—

(18,800,000
)

—

—

—

(18,800,000
)

—

(18,800,000
)

—

Noncontrolling interests related to the
   consolidated Tenant Programs joint ventures

—

—

—

—

—

—

—

—

—

21,800

21,800

—

Redemption of limited partnership interests
   held by our Former Advisor

—

—

—

—

(291,103
)

—

—

—

(291,103
)

91,103

(200,000
)

—

Changes to redeemable common stock

—

—

—

—

(4,049,066
)

—

—

—

(4,049,066
)

—

(4,049,066
)

4,049,066

Redemptions of common stock

(199,883
)

(200
)

(10,242
)

(11
)

—

—

—

—

(211
)

—

(211
)

(2,052,078
)
Issuance of restricted stock

232,176

232

—

—

—

—

—

—

232

—

232

—

Distributions

—

—

—

—

—

(8,533,201
)

—

—

(8,533,201
)

—

(8,533,201
)

—

Distributions to noncontrolling interests

—

—

—

—

—

—

—

—

—

(105,140
)

(105,140
)

—

Issuance of shares for distribution
   reinvestment plan

328,392

328

50,757

50

4,049,066

—

—

—

4,049,444

—

4,049,444

—

Stock compensation expense

—

—

—

—

25,136

—

—

—

25,136

—

25,136

—

Net loss attributable to SmartStop Self
   Storage REIT, Inc.

—

—

—

—

—

—

(2,212,445
)

—

(2,212,445
)

—

(2,212,445
)

—

Net loss attributable to the noncontrolling
   interests in our Operating Partnership

—

—

—

—

—

—

—

—

—

(71,527
)

(71,527
)

—

Foreign currency translation adjustment

—

—

—

—

—

—

—

1,192,459

1,192,459

—

1,192,459

—

Foreign currency forward contract loss

—

—

—

—

—

—

—

(1,039,585
)

(1,039,585
)

—

(1,039,585
)

—

Interest rate swap and cap contract loss

—

—

—

—

—

—

—

(1,861,933
)

(1,861,933
)

—

(1,861,933
)

—

Balance as of June 30, 2019

51,000,324

51,000

7,602,618

7,602

491,113,855

(111,192,953
)

(73,444,156
)

(1,613,117
)

304,922,231

76,728,501

381,650,732

36,143,195

Offering costs

—

—

—

—

(2,276
)

—

—

—

(2,276
)

—

(2,276
)

—

Changes to redeemable common stock

—

—

—

—

(4,046,001
)

—

—

—

(4,046,001
)

—

(4,046,001
)

4,046,001

Redemptions of common stock

(197,470
)

(197
)

(3,546
)

(3
)

—

—

—

—

(200
)

—

(200
)

(349,700
)
Issuance of restricted stock

16,886

17

—

—

—

—

—

—

17

—

17

—

Distributions

—

—

—

—

—

(8,711,332
)

—

—

(8,711,332
)

—

(8,711,332
)

—

Distributions to noncontrolling interests

—

—

—

—

—

—

—

—

—

(1,375,462
)

(1,375,462
)

—

Issuance of shares for distribution
   reinvestment plan

328,801

329

50,784

51

4,046,001

—

—

—

4,046,381

—

4,046,381

—

Stock compensation expense

—

—

—

—

160,858

—

—

—

160,858

—

160,858

—

Net loss attributable to SmartStop Self
   Storage REIT, Inc.

—

—

—

—

—

—

(8,214,826
)

—

(8,214,826
)

—

(8,214,826
)

—

Net loss attributable to the noncontrolling
   interests in our Operating Partnership

—

—

—

—

—

—

—

—

—

(1,326,753
)

(1,326,753
)

—

Foreign currency translation adjustment

—

—

—

—

—

—

—

(651,011
)

(651,011
)

—

(651,011
)

—

Foreign currency hedge contract loss

—

—

—

—

—

—

—

(84,696
)

(84,696
)

—

(84,696
)

—

Interest rate swap and cap contract loss

—

—

—

—

—

—

—

(823,250
)

(823,250
)

—

(823,250
)

—

Balance as of September 30, 2019

51,148,541

$
51,149

7,649,856

$
7,650

$
491,272,437

$
(119,904,285
)

$
(81,658,982
)

$
(3,172,074
)

$
286,595,895

$
74,026,286

$
360,622,181

$
39,839,496

	Common Stock
	Class A						Class T
	Number of Shares			Common Stock Par Value			Number of Shares		Common Stock Par Value		Additional Paid-in Capital			Distributions			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total SmartStop Self Storage REIT, Inc. Equity			Noncontrolling Interests			Total Equity			Preferred Equity		Redeemable Common Stock
Balance as of March 31, 2020		51,763,337		$	51,763			7,749,939	$	7,750	$	491,623,649		$	(137,311,513	)	$	(122,164,437	)	$	(6,703,165	)	$	225,504,047		$	64,893,561		$	290,397,608		$	146,379,708	$	47,370,901
Offering costs		—			—			—		—		(22	)		—			—			—			(22	)		—			(22	)		—		—
Changes to redeemable common stock		—			—			—		—		(4,011,353	)		—			—			—			(4,011,353	)		—			(4,011,353	)		—		4,011,353
Redemptions of common stock		(750	)		(1	)		—		—		—			—			—			—			(1	)		—			(1	)		—		(7,500	)
Issuance of restricted stock		23,725			24			—		—		—			—			—			—			24			—			24			—		—
Distributions		—			—			—		—		—			(8,782,766	)		—			—			(8,782,766	)		—			(8,782,766	)		—		—
Distributions to noncontrolling interests		—			—			—		—		—			—			—			—			—			(1,356,800	)		(1,356,800	)		—		—
Issuance of shares for distribution reinvestment plan		332,570			333			51,277		51		4,010,969			—			—			—			4,011,353			—			4,011,353			—		—
Equity based compensation expense		—			—			—		—		247,323			—			—			—			247,323			176,060			423,383			—		—
Net loss attributable to SmartStop Self Storage REIT, Inc. common stockholders		—			—			—		—		—			—			(8,491,421	)		—			(8,491,421	)		—			(8,491,421	)		—		—
Net loss attributable to the noncontrolling interests in our Operating Partnership		—			—			—		—		—			—			—			—			—			(933,443	)		(933,443	)		—		—
Foreign currency translation adjustment		—			—			—		—		—			—			—			1,700,259			1,700,259			258,961			1,959,220			—		—
Foreign currency forward contract loss		—			—			—		—		—			—			—			(1,677,000	)		(1,677,000	)		(255,451	)		(1,932,451	)		—		—
Interest rate swap and cap contract gain		—			—			—		—		—			—			—			583,475			583,475			88,879			672,354			—		—
Balance as of June 30, 2020		52,118,882		$	52,119			7,801,216	$	7,801	$	491,870,566		$	(146,094,279	)	$	(130,655,858	)	$	(6,096,431	)	$	209,083,918		$	62,871,767		$	271,955,685		$	146,379,708	$	51,374,754

	Nine Months Ended September 30,						Six Months Ended June 30,
	2019			2018			2020			2019
Cash flows from operating activities:
Net loss	$	(20,773,868	)	$	(2,561,655	)	$	(44,806,422	)	$	(11,232,290	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		29,750,462			17,643,908			22,446,897			18,370,226
Accretion of deferred tax		(409,649	)		—
Change in deferred tax liability								(3,023,113	)		—
Accretion of fair market value adjustment of secured debt		(98,850	)		(336,894	)		(65,549	)		(65,659	)
Amortization of debt issuance costs		2,997,801			975,591			1,879,761			1,915,258
Equity based compensation expense								642,986			47,093
Contingent earnout adjustment								(6,700,000	)		—
Impairment of goodwill and intangible assets								36,465,732			—
Impairment of investments in Managed REITs								4,376,879			—
Unrealized foreign currency and derivative (gains) losses								350,781			(259,336	)
Net loss on extinguishment of debt		1,487,867			—			—			1,487,867
Stock compensation expense		208,496			53,336
Contingent earnout expense		300,000			—
Unrealized foreign currency and derivative gains		(630,864	)		(21,779	)
Gain resulting from acquisition of unconsolidated affiliates		(8,017,353	)		—			—			(8,017,353	)
Increase (decrease) in cash from changes in assets and liabilities:
Other assets, net		(363,480	)		(1,244,202	)		235,042			467,125
Accounts payable and accrued liabilities		4,410,733			1,561,727			2,619,780			1,328,303
Managed REITs receivables		33,685			—			79,845			—
Due to affiliates		(752,631	)		304,265			(325,046	)		(105,305	)
Net cash provided by operating activities		8,142,349			16,374,297			14,177,573			3,935,929
Cash flows from investing activities:
Additions to real estate								(7,744,136	)		(5,632,641	)
Deposits on acquisition of real estate								(73,340	)		—
Settlement of foreign currency hedges								398,951			1,586,484
SSGT Mergers, net of cash acquired		(345,538,595	)		—			—			(345,538,595	)
Self Administration Transaction, net of cash acquired		(3,292,958	)		—			—			(3,292,958	)
Purchase of real estate		(9,435,343	)		—
Additions to real estate		(7,993,081	)		(1,112,143	)
Deposits on acquisition of real estate facilities		(200,000	)		—
Investment in real estate joint ventures		—			(3,174,033	)
Settlement of foreign currency hedges		1,064,287			2,132,261
Purchase of foreign currency hedge		(147,347	)		—
Settlement of company owned life insurance		3,122,962			—			—			3,122,962
Sale of real estate joint venture		3,357,814			—			—			3,357,814
Net cash used in investing activities		(359,062,261	)		(2,153,915	)		(7,418,525	)		(346,396,934	)
Cash flows from financing activities:
Gross proceeds from issuance of debt		531,334,779			5,000,000			335,855			514,388,032
Repayment of debt		(141,088,724	)		(2,200,000	)		—			(141,088,724	)
Scheduled principal payments on debt		(566,816	)		(1,603,805	)		(349,450	)		(55,299	)
Debt issuance costs		(8,514,829	)		(163,820	)		(4,459	)		(8,462,191	)
Prepaid debt issuance costs		—			(1,075,000	)
Preferred stock issuance costs								(46,457	)		—
Debt defeasance costs		(1,690,703	)		—			—			(1,690,703	)
Offering costs		(509,512	)		(526,598	)		(352,345	)		(340,654	)
Redemption of common stock		(5,331,329	)		(3,064,408	)		(438,783	)		(3,335,663	)
Redemption of noncontrolling interest		(200,000	)		—			—			(200,000	)
Distributions paid to preferred stockholders								(3,974,779	)		—
Distributions paid to common stockholders		(13,607,658	)		(13,115,607	)		(9,495,228	)		(9,004,432	)
Distributions paid to noncontrolling interests in our Operating Partnership		(1,079,696	)		(226,646	)
Distributions paid to noncontrolling interest in OP								(2,718,583	)		(89,332	)
Net cash provided by (used in) financing activities		358,745,512			(16,975,884	)		(17,044,229	)		350,121,034
Impact of foreign exchange rate changes on cash and restricted cash		96,122			(41,883	)		(230,789	)		(292,071	)
Change in cash, cash equivalents, and restricted cash		7,921,722			(2,797,385	)		(10,515,970	)		7,367,958
Cash, cash equivalents, and restricted cash beginning of period		14,012,208			11,868,412			68,571,123			14,012,208
Cash, cash equivalents, and restricted cash end of period	$	21,933,930		$	9,071,027		$	58,055,153		$	21,380,166

SmartStop Self Storage REIT, ~~Inc. (f/k/a Strategic Storage Trust II, Inc.),~~Inc, a Maryland corporation (the “Company”), is a self-managed and fully-integrated self storage real estate investment trust (“REIT”), formed on January 8, 2013, under the Maryland General Corporation Law. The Company’s year-end is December 31. As used in this report, “we,” “us,” “our,” and “Company” refer to SmartStop Self Storage REIT, Inc. and each of our subsidiaries.

On June 28, 2019, we and our operating partnership, SmartStop OP, L.P. (f/k/a Strategic Storage Operating Partnership II, L.P.) (our “Operating Partnership”), and SmartStop TRS, Inc. (f/k/a Strategic Storage TRS II, Inc.) (the “TRS”) entered into a series of transactions, agreements, and amendments to our existing agreements and arrangements (such agreements and amendments hereinafter referred to collectively as the “Self Administration Transaction”), with SmartStop Asset Management LLC, our former sponsor (“SAM”) and SmartStop OP Holdings, LLC (“SS OP Holdings”), a subsidiary of SAM, pursuant to which, effective June 28, 2019, we acquired the self storage advisory, asset management and property management businesses and ~~Tenant Programs (as defined in Note 9)~~certain joint venture interests ~~of SAM~~ (the “Self Storage Platform”) of SmartStop Asset Management, LLC, our former sponsor (“SAM”), along with certain other assets of ~~SAM.~~SAM (collectively, the “Self Administration Transaction”). As a result of the Self Administration Transaction, SAM is no longer our sponsor, and the special limited partnership interest and limited partnership ~~interest~~interests it held in ~~our Operating Partnership~~SmartStop OP, L.P. (our “Operating Partnership”) through our Former External Advisor (defined below) have been redeemed. ~~Additionally, we~~We are now self-managed and succeed to the advisory, asset management and property management businesses and ~~Tenant Programs~~certain joint ventures previously in place for us, Strategic Storage Trust IV, Inc. (“SST IV”), a public non-traded REIT, and Strategic Storage Growth Trust II, Inc. (“SSGT II”) (collectively with SST IV, the “Managed REITs”), a private non-traded ~~REIT, and now~~REIT. In addition, as a sponsor to the Managed REITs, we now have the internal capability to originate, structure and manage additional investment products (the “Managed REIT Platform”) which would be sponsored by SmartStop REIT Advisors, LLC (“SRA”), our indirect subsidiary. As a result of the Self Administration Transaction, we indirectly own 100% of the membership interests in Strategic Storage Advisor II, LLC (our “Former External Advisor”) and each of Strategic Storage Property Management II, LLC and SS Growth Property Management, LLC (together, our “Former External Property Managers”). See Note 4, Self Administration Transaction, for additional information.

Prior to the Self Administration Transaction, our Former External Advisor was responsible for managing our affairs on a day-to-day basis and identifying and making acquisitions and investments on our behalf under the terms of an advisory agreement and our properties were previously managed by our Former External Property Managers pursuant to property management agreements. However, ~~as a result~~upon completion of the Self Administration Transaction, we acquired approximately 350 self storage professionals and now perform such services on our own behalf. Please see Note 911 – Related Party Transactions.

Our Articles of Amendment and Restatement, as amended and supplemented, authorize 350,000,000 shares of Class A common stock, $0.001 par value per share (the “Class A Shares”), and 350,000,000 shares of Class T common stock, $0.001 par value per share (the “Class T Shares”), and 200,000,000 shares of preferred stock with a par value of $0.001, ~~per share.~~200,000 shares of which have been classified as Series A Convertible Preferred Stock. We offered a maximum of $1.0 billion in common shares for sale to the public (the “Primary Offering”) and $95.0 million in common shares for sale pursuant to our distribution reinvestment plan (collectively, the “Offering”).

On January 10, 2014, the Securities and Exchange Commission (“SEC”) declared our registration statement effective. On May 23, 2014, we satisfied the $1.5 million minimum offering requirements of our Offering and commenced formal operations. On January 9, 2017, our Offering terminated. We sold approximately 48 million Class A Shares and approximately 7 million Class T Shares for approximately $493 million and $73 million respectively, in our Offering. On November 30, 2016, prior to the termination of our Offering, we filed with the SEC a Registration Statement on Form S-3, which registered up to an additional $100.9 million in shares under our distribution reinvestment plan (our “DRP Offering”). The DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders. As of ~~September~~June 30, ~~2019,~~2020, we had sold approximately ~~3.7~~4.7 million Class A Shares and approximately ~~0.6~~0.7 million Class T Shares for approximately ~~$38.3~~$48.6 million and ~~$5.8~~$7.5 million, respectively, in our DRP Offering.

The shares of Series A Convertible Preferred Stock rank senior to all other shares of our capital stock, including our common stock, with respect to rights to receive dividends and to participate in distributions or payments upon any voluntary or involuntary liquidation, dissolution or winding up of the Company. Dividends payable on each share of Series A Convertible Preferred Stock will initially be equal to a rate of 6.25% per annum. If the Series A Convertible Preferred Stock has not been redeemed on or prior to the fifth anniversary date of the Initial Closing, the dividend rate will increase an additional 0.75% per annum each year thereafter to a maximum of 9.0% per annum until the tenth anniversary of the Initial Closing, at which time the dividend rate shall increase 0.75% per annum each year thereafter until the Series A Convertible Preferred Stock is redeemed or repurchased in full. See Note 8, Preferred Equity, for additional information.

We invested the net proceeds from our Offering primarily in self storage facilities. As of ~~September~~June 30, ~~2019,~~2020, we owned 112 ~~operating~~ self storage facilities ~~and one facility under development~~ located in 17 states (Alabama, Arizona, California, Colorado, Florida, Illinois, Indiana, Maryland, Massachusetts, Michigan, New Jersey, Nevada, North Carolina, Ohio, South Carolina, Texas and Washington) and ~~Ontario,~~ Canada (the Greater Toronto Area).

On ~~June 26, 2019,~~April 20, 2020, our board of directors, upon recommendation of our Nominating and Corporate Governance Committee, approved an estimated value per share of our common stock of ~~$10.66~~$10.40 for our Class A Shares and Class T Shares based on the estimated value of our assets less the estimated value of our liabilities, or net asset value, divided by the number of shares outstanding on a fully diluted basis, calculated as of ~~March~~December 31, 2019.

As a result of the calculation of our estimated value per share, beginning in ~~July 2019,~~May 2020, shares sold pursuant to our distribution reinvestment plan are being sold at the estimated value per share of ~~$10.66~~$10.40 for both Class A Shares and Class T Shares.

Prior to the termination of our Primary Offering, Select Capital Corporation, a California corporation (our “Dealer Manager”), was responsible for marketing our shares offered pursuant to our Primary Offering. SAM indirectly owns a 15% non-voting equity interest in our Dealer Manager. Now that our Primary Offering has terminated, our Dealer Manager no longer provides such services for us. However, we pay our Dealer Manager an ongoing stockholder servicing fee with respect to the Class T Shares sold. Please see Note 911 – Related Party Transactions – Dealer Manager Agreement.

Our Operating Partnership was formed on January 9, 2013. During 2013, our Former External Advisor purchased limited partnership interests in our Operating Partnership for $200,000 and on August 2, 2013, we contributed the initial $1,000 capital contribution we received to our Operating Partnership in exchange for the general partner interest. See Note 4, Self Administration Transaction, for additional information.

As we accepted subscriptions for shares of our common stock, we transferred all of the net Offering proceeds to our Operating Partnership as capital contributions in exchange for additional units of interest in our Operating Partnership. However, we were deemed to have made capital contributions in the amount of gross proceeds received from investors, and our Operating Partnership was deemed to have simultaneously paid the sales commissions and other costs associated with the Offering. In addition, our Operating Partnership is structured to make distributions with respect to limited partnership units that are equivalent to the distributions made to holders of common stock. Finally, a limited partner in our Operating Partnership may later exchange his or her limited partnership units in our Operating Partnership for shares of our common stock at any time after one year following the date of issuance of their limited partnership units, subject to certain restrictions outlined in our Operating Partnership’s limited partnership agreement.

Our Operating Partnership owns, directly or indirectly through one or more special purpose entities, all of the self storage properties that we ~~acquire.~~own. As of ~~September~~June 30, ~~2019,~~2020, we owned approximately ~~86.6%~~86.4% of the common units of limited partnership interests of our Operating Partnership. The remaining approximately ~~13.4%~~13.6% of the common units are owned indirectly by SAM and affiliates of our Dealer Manager. As the sole general partner of our Operating Partnership, we have the exclusive power to manage and conduct the business of our Operating Partnership. We conduct certain activities through ~~our~~SmartStop TRS, Inc. (our “TRS”), which is a wholly-owned subsidiary of our Operating Partnership.

On October 1, 2018, we, our Operating Partnership, and SST II Growth Acquisition, LLC, our wholly-owned subsidiary (“Merger Sub”), entered into an Agreement and Plan of Merger (the “SSGT Merger Agreement”) with Strategic Storage Growth Trust, Inc. (“SSGT”), a non-traded REIT then sponsored by SAM, and SS Growth Operating Partnership, L.P. (“SSGT OP”). Pursuant to the terms and conditions set forth in the Merger Agreement, on January 24, 2019: (i) we acquired SSGT by way of a merger of SSGT with and into Merger Sub, with Merger Sub being the surviving entity (the “SSGT REIT Merger”); and (ii) immediately after the SSGT REIT Merger, SSGT OP merged with and into our Operating Partnership, with the Operating Partnership continuing as the surviving entity and remaining a subsidiary of the Company (the “SSGT Partnership Merger” and, together with the SSGT REIT Merger, the “SSGT Mergers”). SSGT was a REIT ~~focused on~~with stated investment objectives to acquire opportunistic self storage properties, including development and lease-up properties. See Note 3, Real Estate Facilities—Merger with Strategic Storage Growth Trust, Inc., for additional information related to the SSGT Mergers.

~~SAM owns 100% of~~The global economy has continued to be adversely impacted by the membership interests of Strategic Transfer Agent Services, LLC, our transfer agent (our “Transfer Agent”). On May 31, 2018, the Company executed an agreement (the “Transfer Agent Agreement”), with our Transfer Agent to provide transfer agent and registrar services to us that are substantially similar to what a third party transfer agent would provideCOVID-19 pandemic, including in the ~~ordinary course~~United States and in the markets in which we operate. The COVID-19 pandemic and the resulting effects, including shutdowns or weakness in national, regional and local economies that negatively impact the demand for self storage space have adversely impacted and could continue to adversely impact our business, financial condition, liquidity and results of ~~performing its functions as a transfer agent. Our Transfer Agent may retain~~operations, however, the extent and ~~supervise third party vendors in its efforts~~duration to ~~administer certain services. Please see Note 9 – Related Party Transactions – Transfer Agent Agreement.~~which our operations will be impacted is highly uncertain and cannot be predicted.

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC.

Our financial statements, and the financial statements of our Operating Partnership, including its wholly-owned subsidiaries, are consolidated in the accompanying consolidated financial statements. The portion of these entities not wholly-owned by us is presented as noncontrolling interests. All significant intercompany accounts and transactions have been eliminated in consolidation.

Current accounting guidance provides a framework for identifying a variable interest entity (“VIE”) and determining when a company should include the assets, liabilities, noncontrolling interests, and results of activities of a VIE in its consolidated financial statements. In general, a VIE is an entity or other legal structure used to conduct activities or hold assets that either (1) has an insufficient amount of equity to carry out its principal activities without additional subordinated financial support, (2) has a group of equity owners that are unable to make significant decisions about its activities, or (3) has a group of equity owners that do not have the obligation to absorb losses or the right to receive returns generated by its operations. Generally, a VIE should be consolidated if a party with an ownership, contractual, or other financial interest in the VIE (a variable interest holder) has the power to direct the VIE’s most significant activities and the obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. A variable interest holder that consolidates the VIE is called the primary beneficiary. Upon consolidation, the primary beneficiary generally must initially record all of the VIE’s assets, liabilities, and noncontrolling interest at fair value and subsequently account for the VIE as if it were consolidated based on majority voting interest. Our Operating Partnership is deemed to be a VIE and is consolidated by the Company as the primary beneficiary.

As of ~~September~~June 30, 2020, and December 31, 2019, we were not a party to any other contracts/interests that would be deemed to be variable interest in VIEs other than our Tenant Programs joint ventures with SST IV and SSGT II which were acquired in the Self Administration Transaction, which are consolidated.

As of December 31, 2018, we were not a party to any other contracts/interests that would be deemed to be variable interest in VIEs other than our Tenant Programs joint ventures and a real estate joint venture, both of which were accounted for under the equity method of accounting. In January 2019, we sold our interest in the real estate joint venture to SST IV, a REIT previously sponsored by SAM and now sponsored by SRA. We acquired 50% of the Tenant Programs joint venture in the Self Administration Transaction such that we now own 100% of such joint venture. Please see Note 3 – Real Estate Facilities for further discussion regarding the real estate joint venture and Note 9 – Related Party Transactions for further discussions regarding our Tenant Programs joint venture. ~~Other than these joint ventures, we did not have any variable interest relationships with unconsolidated entities or financial partnerships as of December 31, 2018~~.Equity Investments

Under the equity method, our investments ~~in real estate joint ventures~~ will be stated at cost and adjusted for our share of net earnings or losses and reduced by ~~distributions.~~distributions and impairments, as applicable. Equity in earnings will generally be recognized based on our ownership interest in the earnings of each of the unconsolidated ~~investment.~~investments.

We account for the noncontrolling ~~interest~~interests in our Operating Partnership and the noncontrolling interests in our Tenant Programs joint ventures with SST IV and SSGT II in accordance with the related accounting guidance. Due to our control through our general partnership interest in our Operating Partnership and the limited rights of the limited partners, our Operating Partnership, including its wholly-owned subsidiaries, are consolidated with the Company and the limited partner interests are reflected as a noncontrolling ~~interest~~interests in the accompanying consolidated balance sheets. ~~Our other consolidated, non wholly-owned joint ventures are~~We also ~~reflected~~consolidate our interests in the SST IV and SSGT II Tenant Programs and present the minority interests as noncontrolling ~~interest.~~interests in the accompanying consolidated balance sheets. The noncontrolling interests shall be attributed their share of income and losses, even if that attribution results in a deficit noncontrolling ~~interest~~interests balance.

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions. Management will adjust such estimates when facts and circumstances dictate. Actual results could materially differ from those estimates. The most significant estimates made include the allocation of property purchase price to tangible and intangible assets acquired and liabilities assumed at relative fair value, the determination if certain entities should be consolidated, the evaluation of potential impairment of indefinite and long-lived assets and goodwill, and the estimated useful lives of real estate assets and intangibles.

We consider all short-term, highly liquid investments that are readily convertible to cash with a maturity of three months or less at the time of purchase to be cash equivalents.

We may maintain cash and cash equivalents in financial institutions in excess of insured limits, but believe this risk will be mitigated by only investing in or through major financial institutions.

Restricted cash consists primarily of impound reserve accounts for property taxes, insurance and capital improvements in connection with the requirements of certain of our loan agreements.

~~We may maintain restricted cash in financial institutions in excess of insured limits, but believe this risk will be mitigated by only investing in or through major financial institutions.~~

We account for acquisitions in accordance with GAAP which requires that we allocate the purchase price of a property to the tangible and intangible assets acquired and the liabilities assumed based on their relative fair values. This guidance requires us to make significant estimates and assumptions, including fair value estimates, which requires the use of significant unobservable inputs as of the acquisition date.

The value of the tangible assets, consisting ~~primarily~~ of land and buildings, is determined as if vacant. Substantially all of the leases in place at acquired properties are at market rates, as the majority of the leases are month-to-month contracts. We also consider whether in-place, market leases represent an intangible asset. We recorded NaN and approximately $13.6 million ~~and NaN~~ in intangible assets to recognize the value of in-place leases related to our acquisitions during the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, respectively. We do not expect, nor to date have we recorded, intangible assets for the value of customer relationships because we expect we will not have concentrations of significant customers and the average customer turnover will be fairly frequent.

Allocation of purchase price to acquisitions of portfolios of facilities are allocated to the individual facilities based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates which take into account the relative size, age, and location of the individual facility along with current and projected occupancy and rental rate levels or appraised values, if available.

Acquisitions ~~of integrated sets of assets and activities~~ that do not meet the definition of a business, as defined under current GAAP, are accounted for as asset acquisitions. During the ~~nine~~six months ended ~~September~~June 30, 2019, ~~and 2018,~~ our property acquisitions ~~have~~did not ~~met~~meet the definition of a business because substantially all of the fair value iswas concentrated in a single identifiable asset or group of similar identifiable assets (i.e. land, buildings, and related intangible assets) or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. As a result, once an acquisition is deemed probable, transaction costs are capitalized rather than expensed.

During the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, we expensed approximately ~~$26,000~~$97,000 and ~~$570,000,~~$46,000, respectively, of acquisition-related transaction costs that did not meet our capitalization policy during the respective periods. During the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, we expensed approximately ~~$194,000~~$125,000 and ~~$850,000,~~$168,000, respectively, of acquisition-related transaction costs that did not meet our capitalization policy during the respective periods.

Should the initial accounting for an acquisition that meets the definition of a business be incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we may adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date and we record those adjustments to our financial statements. We apply ~~those~~any measurement period adjustments in the period in which the provisional amounts are finalized.

As discussed in Note 4, the Self Administration Transaction iswas an acquisition of a ~~business and the related amounts recorded as of September 30, 2019 are provisional and subject to change.~~business.

Management monitors events and changes in circumstances that could indicate that the carrying amounts of our ~~long-lived~~real property assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of the assets may not be recoverable, we will assess the recoverability of the assets by determining whether the carrying value of the ~~long-lived~~real property assets will be recovered through the undiscounted future operating cash flows expected from the use of the asset and its eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying value, we will adjust the value of the ~~long-lived~~real property assets to the fair value and recognize an impairment loss. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, 0 impairment losses related to our real property assets were recognized.

We generally consider real estate to be “held for sale” when the following criteria are met: (i) management commits to a plan to sell the property, (ii) the property is available for sale immediately, (iii) the property is actively being marketed for sale at a price that is reasonable in relation to its current fair value, (iv) the sale of the property within one year is considered probable and (v) significant changes to the plan to sell are not expected. Real estate that is held for sale is classified as “real estate held for sale” in the accompanying consolidated financial statements for the periods when it was held for sale. Real estate classified as held for sale is no longer depreciated and is reported at the lower of its carrying value or its estimated fair value less estimated costs to sell. Operating results and related gains (losses) on sale of properties that were disposed of or classified as held for sale in the ordinary course of business are included in continuing operations on the Company’s consolidated statements of operations, consistent with current accounting guidance.

We ~~have~~initially recorded goodwill of approximately $78.4 million as a result of the Self Administration Transaction. Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible assets and other intangible assets acquired. Goodwill is allocated to various reporting units, as applicable, and is not amortized. We ~~will~~ perform an annual impairment test for goodwill, and between annual tests, we ~~will~~ evaluate the recoverability of goodwill whenever events or changes in circumstances indicate that the carrying amount of goodwill may not be fully recoverable. In our impairment ~~tests~~test of goodwill, we ~~will first assess qualitative factors~~perform a quantitative analysis to ~~determine whether it is more likely than not that~~compare the fair value of aeach reporting unit ~~is less than~~to its respective carrying amount. If based on this assessment, management determines that the fair value of the reporting unit is not less than its carrying amount, then performing the additional two-step impairment test is unnecessary. If the carrying amount of goodwill exceeds its fair value, an impairment charge will be recognized.

See Note 5—Self Administration Transaction - Intangibles, Goodwill, and Certain Other Assets and Liabilities for additional information.

In connection with the Self Administration Transaction, we initially recorded $19.8 million associated with the 2 primary trademarks acquired. Prior thereto we had 0 amounts recorded related to trademarks.

Trademarks are based on the value of our brands. Trademarks are valued using the relief from royalty method, which presumes that without ownership of such trademarks, we would have to make a stream of payments to a brand or franchise owner in return for the right to use their name. By virtue of this asset, we avoid any such payments and record the related intangible fair value of our ownership of the brand name. We used the following significant projections and assumptions to determine fair value under the relief from royalty method: revenues; royalty rate; tax expense; terminal growth rate; and discount rate. For the SmartStop^® trademark, the projections underlying this relief from royalty model were forecasted for eight years and then a terminal value calculation was applied. For the Strategic Storage^® trademark, the projections underlying the relief from royalty model were forecasted for seven years. Applying the selected pretax royalty rates to the applicable revenue base in each period yielded pretax income for each of our trademarks. These pretax totals were tax effected utilizing the applicable tax rate to arrive at net, after-tax cash flows. The net, after-tax cash flows were then discounted to present value utilizing an appropriate discount rate. The present value of the after-tax cash flows were then added to the present value of the amortization tax benefit (considering the 15-year amortization of intangible assets pursuant to U.S. tax legislation) to arrive at the recommended fair values for the trademarks.

The total estimated future amortization expense of the “Strategic Storage^®” trademark asset for the years ending December 31, 2020, 2021, 2022, 2023, 2024 and thereafter is approximately $70,000, $140,000, $140,000, $140,000,
$70,000 and NaN, respectively.

We ~~will~~ evaluate whether any triggering events or changes in circumstances have occurred subsequent to our annual impairment test that would indicate an impairment condition may exist. If any change in circumstance or triggering event occurs, and results in a significant impact to our revenue and profitability projections, or any significant assumption in our ~~valuations~~valuation methods is adversely impacted, the impact could result in a material impairment charge in the future.

~~In connection with the~~ See Note 5—Self Administration Transaction ~~we recorded $19.8 million associated with the 2 primary trademarks acquired. Prior thereto we had 0 amounts recorded related to trademarks.~~

~~Approximately $18.7 million of the original $19.8 million of trademarks relates to the “SmartStop~~^®~~” trademark, which is an indefinite-lived intangible. The remaining approximately $1.1 million relates to our “Strategic Storage~~^®~~” trademark~~- Intangibles, Goodwill, and ~~will be amortized over a five year period. As of September 30, 2019, we had accumulated amortization of approximately $57,000 associated with the “Strategic Storage~~^®~~” trademark.~~

~~The total estimated future amortization expense of the “Strategic Storage~~^®~~” trademark asset~~Certain Other Assets and Liabilities for the years ending December 31, 2019, 2020, 2021, 2022, 2023 and thereafter is approximately $55,000, $220,000, $220,000, $220,000,
$220,000 and $108,000, respectively.additional information.

Management believes that all of our leases are operating leases. Rental income is recognized in accordance with the terms of the leases, which generally are month-to-month. Revenues from any long-term operating leases are recognized on a straight-line basis over the term of the lease. The excess of rents received over amounts contractually due pursuant to the underlying leases is included in accounts payable and accrued liabilities in our consolidated balance sheets, and contractually due but unpaid rent is included in other assets.

We earn property management and asset management revenue, pursuant to the respective property management and advisory agreement contracts, in connection with providing services to the Managed REITs. We have determined under ASC 606 – Revenue from Contracts with Customers (“ASC 606”), that the performance obligation for the property management services and asset management services are satisfied as the services are rendered. While we are compensated for our services on a monthly basis, these services represent a series of distinct daily services in accordance with ASC 606. Such revenue is recorded in the Managed REIT Platform revenue ~~includes~~line within our consolidated statements of operations.

The Managed REITs’ advisory ~~asset~~agreements also provide for reimbursement to us of our direct and indirect costs of providing administrative and management services to the Managed REITs. These reimbursements include costs incurred in relation to organization and offering services provided to the Managed REITs and the reimbursement of salaries, bonuses, and other expenses related to benefits paid to our employees while performing services for the Managed REITs. The Managed REITs’ property management agreements also provide reimbursement to us for the property manager’s costs of managing the properties. Reimbursable costs include wages and salaries and other expenses that arise in operating, managing and maintaining the Managed REITs’ properties.

Under ASC 606, direct reimbursement of such costs does not represent a separate performance obligation from our obligation to perform property management and ~~other similar fees. Such fees~~asset management services. The reimbursement income is considered variable consideration, and is recognized as the costs are ~~earned pursuant~~incurred, subject to limitations on the Managed REIT Platform’s ability to incur offering costs or limitations imposed by the advisory agreements. We have elected to separately record such revenue in the Reimbursable costs from Managed REITs line within our consolidated statements of operations.

Additionally, we earn revenue in connection with our Tenant Programs joint ventures with our Managed REITs. We also earn development and ~~property~~construction management ~~agreements~~revenue from services we provide in connection with the project design, coordination and oversite of development and certain capital improvement projects undertaken by the Managed REITs. ~~The fees are recognized~~We recognize such revenue in the ~~periods during which the related services are performed and the amounts have been contractually earned.~~ ~~Revenue from such contracts is discussed further in~~Managed REIT Platform revenue line within our consolidated statements of operations. See Note ~~9 -~~11 – Related Party ~~Transactions.~~Transactions, for additional information regarding revenue generated from our Managed REIT Platform.

Tenant accounts receivable is reported net of an allowance for doubtful accounts. Management records a general reserve estimate based upon a review of the current status of tenant accounts receivable. It is reasonably possible that management’s estimate of the allowance will change in the future.

Real estate facilities are recorded based on relative fair value as of the date of acquisition. We capitalize costs incurred to develop, construct, renovate and improve properties, including interest and property taxes incurred during the construction period. The construction period begins when expenditures for the real estate assets have been made and activities that are necessary to prepare the asset for its intended use are in progress. The construction period ends when the asset is substantially complete and ready for its intended use.

Our management is required to make subjective assessments as to the useful lives of our depreciable assets. We consider the period of future benefit of the asset to determine the appropriate useful lives.

Depreciation of our real property assets is charged to expense on a straight-line basis over the estimated useful lives
as follows:

Personal property assets consist primarily of furniture, fixtures and equipment and are depreciated on a straight-line basis over the estimated useful lives, generally ranging from 3 to 5 years, and are included in other assets on our consolidated balance sheets.

We have allocated a portion of our real estate purchase price to in-place lease intangibles. We are amortizing in-place lease intangibles on a straight-line basis over the estimated future benefit period. As of ~~September~~June 30, ~~2019,~~2020, the gross ~~amounts~~amount allocated to in-place lease intangibles was approximately ~~$46.7~~$46.5 million and accumulated amortization of in-place lease intangibles totaled approximately ~~$38.1~~$44.5 million. As of December 31, ~~2018,~~2019, the gross amounts allocated to in-place lease intangibles were approximately ~~$33.4~~$46.8 million and accumulated amortization of in-place lease intangibles totaled approximately ~~$31.9~~$40.4 million.

The total estimated future amortization expense of ~~in-place lease~~ intangible assets related to our self storage properties for the years ending December 31, ~~2019,~~ 2020, 2021, 2022, 2023, 2024, and thereafter is approximately ~~$2.2~~$0.6 million, ~~$5.0~~$0.1 million, $0.1 million, $0.1 million, $0.1 million, and ~~$1.1~~$1.0 million, respectively.

As of ~~September~~June 30, 2020, the gross amount of the intangible assets related to the Managed REITs contracts and the customer relationships related to the Tenant Programs joint ventures was approximately $18.1 million and accumulated amortization of those intangibles totaled approximately $5.3 million. As of December 31, 2019, the gross amount ~~allocated~~of the intangibles related to the Managed REITs contracts and the customer relationships related to the Tenant Programs joint ventures was approximately $26.5 million and ~~the~~ accumulated amortization ~~was~~of those intangibles totaled approximately ~~$1.5~~$2.9 million.

The total estimated future amortization expense for such intangible assets for the years ending December 31, ~~2019,~~ 2020, 2021, 2022, 2023, 2024 and thereafter is approximately ~~$1.4~~$2.0 million, ~~$5.7~~$2.9 million, ~~$4.6~~$2.9 million, ~~$4.6~~$2.9 million, ~~$4.6~~$1.8 million, and ~~$4.1~~$0.3 million, respectively.

We evaluate whether any triggering events or changes in circumstances have occurred subsequent to our annual impairment test that would indicate an impairment condition may exist. If any change in circumstance or triggering event occurs, and results in a significant impact to our revenue and profitability projections, or any significant assumption in our valuations methods is adversely impacted, the impact could result in a material impairment charge in the future. See Note 5—Self Administration Transaction - Intangibles, Goodwill, and Certain Other Assets and Liabilities for additional information.

The net carrying value of costs incurred in connection with our former revolving credit facility was presented as debt issuance costs on our consolidated balance sheet as of December 31, 2018. Debt issuance costs were amortized on a straight-line basis over the term of the related loan, which was not materially different than the effective interest method. As of September 30, 2019 and December 31, 2018, accumulated amortization of debt issuance costs related to our former revolving credit facility totaled NaN and approximately $45,000, respectively.

The net carrying value of costs incurred in connection with obtaining non revolving debt are presented on the balance sheet as a deduction from debt (see Note 6)7). Debt issuance costs are amortized on a straight-line basis over the term of the related loan, which is not materially different than the effective interest method. As of ~~September~~June 30, ~~2019~~2020, the gross amount allocated to debt issuance costs related to non-revolving debt totaled approximately $11.8 million and ~~December 31, 2018,~~ accumulated amortization of debt issuance costs related to non-revolving debt totaled approximately ~~$3.7~~$6.1 million. As of December 31,

2019, the gross amount allocated to debt issuance costs related to non-revolving debt totaled approximately $11.9 million and ~~$1.0 million, respectively.~~accumulated amortization of debt issuance costs related to non-revolving debt totaled approximately $4.3 million.

We pay our Dealer Manager an ongoing stockholder servicing fee that is payable monthly and accrues daily in an amount equal to 1/365th of 1% of the purchase price per share of the Class T Shares sold in the Primary Offering. We will cease paying the stockholder servicing fee with respect to the Class T Shares sold in the Primary Offering at the earlier of (i) the date we list our shares on a national securities exchange, merge or consolidate with or into another entity, or sell or dispose of all or substantially all of our ~~assets,~~assets; (ii) the date at which the aggregate underwriting compensation from all sources equals 10% of the gross proceeds from the sale of both Class A Shares and Class T Shares in our Primary Offering (i.e., excluding proceeds from sales pursuant to our distribution reinvestment plan), which calculation shall be made by us with the assistance of our Dealer Manager commencing after the termination of the Primary Offering; (iii) the fifth anniversary of the last day of the fiscal quarter in which our Primary Offering (i.e., excluding our distribution reinvestment plan offering) terminated; and (iv) the date that such Class T Share is redeemed or is no longer outstanding. Our Dealer Manager entered into participating dealer agreements with certain other broker-dealers which authorized them to sell our shares. Upon sale of our shares by such broker-dealers, our Dealer Manager re-allowed all of the sales commissions and, subject to certain limitations, the stockholder servicing fees paid in connection with sales made by these broker-dealers. Our Dealer Manager was also permitted to re-allow to these broker-dealers a portion of their dealer manager fee as marketing fees, reimbursement of certain costs and expenses of attending training and education meetings sponsored by our Dealer Manager, payment of attendance fees required for employees of our Dealer Manager or other affiliates to attend retail seminars and public seminars sponsored by these broker-dealers, or to defray other distribution-related expenses. Our Dealer Manager also received reimbursement of bona fide due diligence expenses; however, to the extent the due diligence expenses could not be justified, any excess over actual due diligence expenses would have been considered underwriting compensation subject to a 10% FINRA limitation and, when aggregated with all other non-accountable expenses in connection with our Public Offering, could not exceed 3% of gross offering proceeds from sales in the Public Offering. We recorded a liability within ~~Due~~due to affiliates for the future estimated stockholder servicing fees at the time of sale of Class T Shares as an offering cost.

For non-U.S. functional currency operations, assets and liabilities are translated to U.S. dollars at current exchange rates. Revenues and expenses are translated at the average rates for the period. All adjustments related to amounts classified as long term net equity investments are recorded in accumulated other comprehensive income (loss) as a separate component of equity. Transactions denominated in a currency other than the functional currency of the related operation are recorded at rates of exchange in effect at the date of the transaction. Changes in equity investments not classified as long term are recorded in other income (expense) and represented a ~~loss~~gain of approximately ~~$0.2~~$0.5 million and ~~NaN~~a gain of approximately $0.5 million for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, respectively, and represented a loss of approximately $0.6 million and a gain of approximately ~~$0.7~~$0.9 million ~~and NaN~~ for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018,~~ respectively.

We previously adopted a share redemption program that ~~enables~~previously enabled stockholders to sell their shares to us in limited circumstances.

We record amounts that are redeemable under the share redemption program as redeemable common stock in the accompanying consolidated balance sheets since the shares are redeemable at the option of the holder and therefore their redemption is outside our control. The maximum amount redeemable under our share redemption program is limited to the number of shares we can repurchase with the amount of the net proceeds from the sale of shares under the distribution reinvestment plan. However, accounting guidance states that determinable amounts that can become redeemable should be presented as redeemable when such amount is known. Therefore, the net proceeds from the distribution reinvestment plan are considered to be temporary equity and are presented as redeemable common stock in the accompanying consolidated balance sheets.

In addition, current accounting guidance requires, among other things, that financial instruments that represent a mandatory obligation of us to repurchase shares be classified as liabilities and reported at settlement value. On August 26,

2019, our board of directors approved the suspension of our share redemption program, effective as of September 27, 2019, so that common shares ~~are~~were redeemable at the option of the holder only in connection with (i) death or disability of a stockholder, (ii) confinement to a long-term care facility, or (iii) other exigent circumstances. In order to preserve cash in light of the uncertainty relating to COVID-19 and its potential impact on our overall financial results, on March 30, 2020, our board of directors approved the complete suspension of our share redemption program, effective on April 29, 2020. The share redemption program will remain suspended until its resumption is approved by the board, if ever. When we determine we have a mandatory obligation to repurchase shares under the share redemption program, we reclassify such obligations from temporary equity to a liability based upon their respective settlement values. As a result, we were not able to honor redemption requests made during the six months ended June 30, 2020.

For the year ended December 31, ~~2018,~~2019, we received redemption requests totaling approximately ~~$8.3~~$4.9 million (approximately ~~0.9~~0.5 million shares), approximately ~~$7.0~~$4.5 million of which were fulfilled during the year ended December 31, ~~2018,~~2019, with the remaining approximately ~~$1.3~~$0.4 million included in accounts payable and accrued liabilities as of December 31, ~~2018~~2019, and fulfilled in January ~~2019. For~~2020. During the ~~nine~~six months ended ~~September~~June 30, ~~2019, we received~~2020, approximately 0.1 million shares, or $1.3 million, were requested to be redeemed; however, due to the suspension of our share redemption program, no share redemption requests ~~totaling approximately $4.4 million (approximately 450,000 shares), approximately $4.0 million of which~~ were ~~fulfilled in April and July 2019, and approximately $0.4 million of which were included in accounts payable and accrued liabilities as of September 30, 2019, and fulfilled in October 2019.~~fulfilled.

~~Through September 30, 2019,~~We issue equity based awards in two forms: (1) restricted stock awards consisting of shares of our common stock and (2) long-term incentive plan units of our Operating Partnership (“LTIP Units”), both of which may be issued subject to either time based vesting criteria or performance based vesting criteria restrictions. For time based awards granted which contain a graded vesting schedule, compensation cost is recognized as an expense on a straight-line basis over the requisite service period as if the award was, in substance, a single award. For performance based awards, compensation cost is recognized over the requisite service period if and when we ~~have only issued service based awards. The~~determine the performance condition is probable of being achieved. We record the cost of such ~~restricted stock~~equity based awards ~~is required to be measured~~ based on the grant date fair value, and ~~the cost recognized over the relevant service period. We~~ have ~~assumed no~~elected to record forfeitures ~~in recognizing these costs; any such forfeitures will be recognized upon occurrence and will reduce the previously recognized expenses.~~as they occur.

Under GAAP, we are required to measure certain financial instruments at fair value on a recurring basis. In addition, we are required to measure other financial instruments and balances at fair value on a non-recurring basis. Fair value is defined by the accounting standard for fair value measurements and disclosures as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. It also establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three levels. The following summarizes the three levels of inputs and hierarchy of fair value we use when measuring fair value:

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the fair value measurement will fall within the lowest level that is significant to the fair value measurement in its entirety.

The accounting guidance for fair value measurements and disclosures provides a framework for measuring fair value and establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. In determining fair value, we will utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as consider counterparty credit risk in our assessment of fair value. Considerable judgment will be necessary to interpret Level 2 and 3 inputs in determining fair value of our financial and non-financial assets and liabilities. Accordingly, there can be no assurance that the fair values we will present will be indicative of amounts that may ultimately be realized upon sale or other disposition of these assets.

Financial and non-financial assets and liabilities measured at fair value on a non-recurring basis in our consolidated financial statements consist of real estate and related liabilities assumed related to our acquisitions along with the assets and liabilities described in Note 4, Self Administration Transaction. The fair values of these assets and liabilities were determined as of the acquisition dates using widely accepted valuation techniques, including (i) discounted cash flow analysis, which considers, among other things, leasing assumptions, growth rates, discount rates and terminal capitalization rates, (ii) income capitalization approach, which considers prevailing market capitalization rates, and (iii) comparable sales activity. Additionally, certain such assets and liabilities are required to be fair valued periodically or valued pursuant to ongoing impairment analyses and have been valued subsequently utilizing the same techniques noted above. In general, we consider multiple valuation techniques when measuring fair values. However, in certain circumstances, a single valuation technique may be appropriate. All of the fair values of the assets and liabilities as of the acquisition dates were derived using Level 3 inputs.

The carrying amounts of cash and cash equivalents, restricted cash, other assets, variable-rate debt, accounts payable and accrued liabilities, distributions payable and amounts due to affiliates approximate fair value.

The table below summarizes our fixed rate notes payable at ~~September~~June 30, ~~2019~~2020, and December 31, ~~2018.~~2019. The estimated fair value of financial instruments is subjective in nature and is dependent on a number of important assumptions, including discount rates and relevant comparable market information associated with each financial instrument. The fair value of the fixed rate notes payable was estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities. The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the estimates presented below are not necessarily indicative of the amounts we would realize in a current market exchange.

As of ~~September~~June 30, ~~2019,~~2020, and December 31, ~~2018,~~2019, we had interest rate swaps, interest rate caps, and a net investment hedge (See Notes 67 and 7)9). The valuations of these instruments were determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of the derivative. The ~~analysis reflected~~analyses reflect the contractual terms of the ~~derivative,~~derivatives, including the period to maturity, and used observable market-based inputs, including interest rate curves, foreign exchange rates, and implied volatilities. The fair value of the interest rate swaps were determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash payments. Our fair values of our net investment hedges are based on the change in the spot rate at the end of the period as compared with the strike price at inception.

To comply with GAAP, we incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of derivative contracts for the effect of non-performance risk, we ~~will~~ consider the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

Although we had determined that the majority of the inputs used to value our derivatives were within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilized Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparties. However, through ~~September~~June 30, ~~2019,~~2020, we had assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and determined that the credit valuation adjustments were not significant to the overall valuation of our derivatives. As a result, we determined that our derivative valuations in their entirety were classified in Level 2 of the fair value hierarchy.

We record all derivatives on our balance sheet at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative, whether we have elected to designate a derivative in a hedging relationship and apply hedge accounting and whether the hedging relationship has satisfied the criteria necessary to apply hedge accounting. Derivatives designated and qualifying as a hedge of the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives designated and qualifying as a hedge of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges. Derivatives may also be designated as hedges of the foreign currency exposure of a net investment in a foreign operation. We may enter into derivative contracts that are intended to economically hedge certain of our risks, even though hedge accounting does not apply or we elect not to apply hedge accounting.

For derivatives designated as net investment hedges, the effective portion of changes in the fair value of the derivatives are reported in accumulated other comprehensive ~~income.~~income (loss). The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Amounts are reclassified out of other comprehensive (loss) income into earnings (loss) when the hedged net investment is either sold or substantially liquidated.

We made an election to be taxed as a Real Estate Investment Trust (“REIT”), under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2014. To qualify as a REIT, we must continue to meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the REIT’s ordinary taxable income to stockholders (which is computed without regard to the dividends paid deduction or net capital gains and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will then be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders. However, we believe that we are organized and operate in such a manner as to qualify for treatment as a REIT and intend to operate in the foreseeable future in such a manner that we will remain qualified as a REIT for federal income tax purposes.

Even if we continue to qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property, and federal income and excise taxes on our undistributed income.

We filed an election to treat our TRS as a taxable REIT subsidiary effective January 1, 2014. In general, the TRS performs additional services for our customers and provides the advisory and property management services to the Managed REITs and otherwise generally engages in any real estate or non-real estate related business. The TRS is subject to corporate federal and state income tax. The TRS follows accounting guidance which requires the use of the asset and liability method. Deferred income taxes represent the tax effect of future differences between the book and tax bases of assets and liabilities.

Our business is comprised of ~~two~~2 reportable segments: (i) self storage operations and (ii) the Managed REIT Platform business. Please see Note 810 – Segment Disclosures for additional detail.

We classify our Series A Convertible Preferred Stock on our consolidated balance sheets using the guidance in ASC 480‑10‑S99. Our Series A Convertible Preferred Stock can be redeemed by us on or after the fifth anniversary of its issuance, or if certain events occur, such as the listing of our common stock on a national securities exchange, a change in control, or if a redemption would be required to maintain our REIT status. Additionally, if we do not maintain our REIT status the holder can require redemption. As the shares are contingently redeemable, and under certain circumstances not solely within our control, we have classified our Series A Convertible Preferred Stock as temporary equity.

We have analyzed whether the conversion features in our Series A Convertible Preferred Stock should be bifurcated under the guidance in ASC 815‑10 and have determined that bifurcation is not necessary.

Basic earnings per share attributable to our common stockholders for all periods presented are computed by dividing net income (loss) attributable to our common stockholders by the weighted average number of common shares outstanding during the period, excluding unvested restricted stock. Diluted earnings per share is computed by including the dilutive effect of the conversion of all potential common stock equivalents (which includes unvested restricted stock ~~utilizing~~and convertible preferred stock) and the ~~treasury stock method.~~adding back of the Series A Convertible Preferred Stock dividends. For all periods presented, the dilutive effect of convertible preferred stock and unvested restricted stock was not included in the diluted weighted average shares as such ~~shares were~~impact was antidilutive.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” ASU 2016-02 amends the guidance on accounting for leases. Under ASU 2016-02, lessees will be required to recognize the following for all leases (with the exception of short term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under ASU 2016-02, lessor accounting is largely unchanged. It also includes extensive amendments to the disclosure requirements. ASU 2016-02 is effective for fiscal years and interim periods beginning after December 15, 2018. We adopted this standard on January 1, 2019 using the modified retrospective approach, without applying the provisions to comparative periods presented. Its adoption did not have a material impact on our consolidated financial statements as substantially all of our lease revenues are derived from month-to-month leases and, as lessee, we have no significant leases. In addition, the new standard requires our expected loss related to collectability of rental payments, previously reflected in property operating expenses as bad debt expense, to be reflected as a reduction to self storage rental revenue. The impact of this was a reduction in both self storage rental revenue and property operating expenses of approximately $450,000 and $1,170,000 for the three and nine months ended September 30, 2019, respectively. During the three and nine months ended September 30, 2018, bad debt expense totaled approximately $290,000 and $875,000, respectively, and is included in property operating expenses.

In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities”. ASU 2017-12 is intended to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements and to simplify the application of the hedge accounting guidance under previous GAAP. ASU 2017-12 is effective for fiscal years and interim periods within those years beginning after December 15, 2018, with early adoption permitted. For cash flow and net investment hedges existing at the date of adoption, a reporting entity must apply the amendments in ASU 2017-12 using the modified retrospective approach by recording a cumulative-effect adjustment to equity as of the beginning of the fiscal year of adoption. The Company adopted ASU 2017-12 effective beginning January 1, 2019, and its adoption did not have a material impact on our financial statements.

The following summarizes the activity in real estate facilities during the ~~nine~~six months ended ~~September~~June 30, ~~2019:~~2020:

On June 2, 2020, one of our subsidiaries executed a purchase and sale agreement with an unaffiliated third party for the acquisition of a plot of land (the “Kipling Property”) in the city of Toronto that we intend to develop into a self storage facility. The purchase price for the Kipling Property is approximately $2.2 million CAD, with an adjustment factor depending on the final survey, plus closing costs. We expect to complete the acquisition in the first or second quarter of 2022; however, there can be no assurance that we will complete the acquisition. If we fail to acquire the Kipling Property, in addition to the incurred acquisition costs, we may also forfeit earnest money deposits as a result.

On October 1, 2018, we, our Operating Partnership, and SST II Growth Acquisition, LLC, our wholly-owned subsidiary (“Merger Sub”), entered into an Agreement and Plan of Merger (the “SSGT Merger Agreement”) with Strategic Storage Growth Trust, Inc. (“SSGT”), a non-traded REIT then sponsored by SAM, and SS Growth Operating Partnership, L.P. (“SSGT OP”). Pursuant to the terms and conditions set forth in the SSGT Merger Agreement, on January 24, 2019: (i) we acquired SSGT by way of a merger of SSGT with and into Merger Sub, with Merger Sub being the surviving entity (the “SSGT REIT Merger”); and (ii) immediately after the SSGT REIT Merger, SSGT OP merged with and into our Operating Partnership, with the Operating Partnership continuing as the surviving entity and remaining a subsidiary of the Company (the “SSGT Partnership Merger” and, together with the SSGT REIT Merger, the “SSGT Mergers”).

At the effective time of the SSGT REIT Merger (the “SSGT REIT Merger Effective Time”), each share of SSGT common stock, par value $0.001 per share (the “SSGT Common Stock”), outstanding immediately prior to the SSGT REIT Merger Effective Time (other than shares owned by SSGT and its subsidiaries or us and our subsidiaries) was automatically converted into the right to receive an amount in cash equal to $12.00, without interest and less any applicable withholding taxes. The proceeds used to fund the SSGT Mergers and the repayment of approximately $141 million of our outstanding debt were funded by the SSGT Merger Financings, totaling approximately $500 million, as described in Note 6.

Immediately prior to the SSGT REIT Merger Effective Time, all shares of SSGT Common Stock that were subject to vesting and other restrictions also became fully vested and converted into the right to receive cash equal to $12.00 per share upon the SSGT REIT Merger.7.

At the effective time of the SSGT Partnership Merger, each outstanding unit of partnership interest in SSGT OP was converted automatically into 1.127 units of partnership interest in our Operating Partnership, which resulted in approximately 396,000 Class A Units of our Operating Partnership being issued to SS Growth Advisor, LLC, a subsidiary of SAM.

SSGT was a REIT ~~focused on~~with stated investment objectives to acquire opportunistic self storage properties, including development, and lease-up properties. As a result of the SSGT Mergers, we acquired all of the real estate owned by SSGT, consisting of 28 operating self storage facilities located in 10 states and in the Greater Toronto ~~Canada area,~~Area, and 1 development property in the Greater Toronto Area. Additionally, we obtained the rights to acquire a self storage facility which was under development located in Gilbert, Arizona that was previously under contract with SSGT and was acquired by us in July 2019.

The following table reconciles the total consideration transferred during the SSGT Mergers:

~~The following table summarizes the relative fair values of the assets acquired and liabilities assumed in the SSGT Mergers:~~

On January 24, 2019, we, by way of the SSGT Mergers, obtained the rights to acquire a property that was being developed into a self storage facility located in Gilbert, Arizona (the “Riggs Road Property”). On July 11, 2019, upon issuance of the certificate of occupancy, we acquired the Riggs Road Property for a purchase price of $10 million, plus closing costs and acquisition fees. Pursuant to the Contribution Agreement (as defined in Note 4), an acquisition fee of $175,000 was paid to SAM. We funded such acquisition through a $4.3 million draw on the Senior Term Loan and an approximate $5.7 million draw on the Secured Loan.

~~The following table summarizes the purchase price allocation for the real estate related assets acquired during the nine months ended September 30, 2019:~~

The San Antonio II Property was acquired by us in the SSGT Mergers. On February 5, 2019, we executed a purchase and sale agreement with an unaffiliated third party for the sale of the San Antonio II Property for approximately $16.1 million, less closing costs. The San Antonio II Property sale was completed on October 18, 2019. ~~See Note 14 – Subsequent Events for further detail~~.

In January 2018, a subsidiary of SAM entered into a contribution agreement (the “SmartCentres Contribution Agreement”) with a subsidiary of SmartCentres Real Estate Investment Trust, an unaffiliated third party (“SmartCentres”), for a tract of land owned by SmartCentres and located in East York, Ontario (the “East York Lot”) in Canada. In March 2018, the interest in the SmartCentres Contribution Agreement was assigned to one of our subsidiaries.

On June 28, 2018, we closed on the East York Lot, which is owned by a limited partnership (the “Limited Partnership”), in which we (through our subsidiary) and SmartCentres (through its subsidiary) were each a 50% limited partner and each had an equal ranking general partner in the Limited Partnership. At closing, we subscribed for 50% of the units in the Limited Partnership at an agreed upon subscription price of approximately $3.8 million CAD, representing a contribution equivalent to 50% of the agreed upon fair market value of the land. The Limited Partnership intends to develop a self storage facility on the East York Lot. The value of the land contributed to the Limited Partnership had an agreed upon fair market value of approximately $7.6 million CAD. In January 2019, we sold our interest in the Limited Partnership to SST IV for approximately $4.7 million CAD, which represented our total cost incurred related to the Limited Partnership. Of this amount, approximately $4.6 million CAD related to the acquisition of land and development costs incurred, and approximately $100,000 CAD related to acquisition costs that were expensed during 2018, which were recorded in other income (expense) in the consolidated statement of operations for the nine months ended September 30, 2019.

On June 28, 2019, we, our Operating Partnership and our TRS entered into a series of transactions, agreements, and amendments to our existing agreements and arrangements with our then-sponsor SAM and SS OP Holdings, a subsidiary of

SAM, pursuant to which, effective June 28, 2019, we acquired the self storage advisory, asset management and property management businesses and ~~Tenant Programs~~certain joint venture interests of SAM, along with certain other assets of SAM.

As a result of the Self Administration Transaction, SAM is no longer our sponsor, and we are now self-managed and succeed to the advisory, asset management and property management businesses and ~~Tenant Programs~~certain joint ventures previously in place for us, SST IV, SSGT II, and we now have the internal capability to originate, structure and manage additional future investment products which would be sponsored by SRA. The Self Administration Transaction and the other transactions discussed herein were approved by our board of directors at the recommendation of a special committee of our board of directors comprised solely of independent directors.

On June 28, 2019, we along with our Operating Partnership, as contributee, and SAM and SS OP Holdings, as contributor, entered into a Contribution Agreement (the “Contribution Agreement”) whereby the Operating Partnership acquired the Self Storage Platform and certain other assets, including (a) SAM’s, or its subsidiaries’, 100% membership interests in our Former External Advisor and Former External Property Managers, the advisor and property manager for SST IV, the advisor and property manager for SSGT II, entities related to the Tenant Programs joint ventures, and certain entities related to SAM’s self storage business in Canada; (b) all equipment, furnishings, fixtures and computer equipment as set forth in the Contribution Agreement; (c) certain personal property as set forth in the Contribution Agreement; (d) all intellectual property, goodwill, licenses and sublicenses granted and obtained with respect thereto (including all rights to the “SmartStop®” brand and “Strategic Storage®” related trademarks),; (e) SAM’s processes, practices, procedures and workforce related to the self storage business (then consisting of a total of approximately 350 on-site self storage employees, regional and district managers, other personnel and the then current executive management team of the Company),; and (f) certain other assets as set forth in the Contribution Agreement, in exchange for $769,126 in cash, assumption of existing debt in the amount of $15 million, and 8,698,956 Class A-1 limited partnership units of the Operating Partnership (“Class A-1 Units”) and 3,283,302 Class A-2 limited partnership units of the Operating Partnership (“Class A-2 Units”). For a description of the Class A-1 Units and Class A-2 Units, see below under the heading “Third Amended and Restated Limited Partnership Agreement and Redemption of Limited Partner Interest Agreement.”

The Contribution Agreement contains customary representations, warranties, covenants, agreements and indemnification obligations and rights of us, the Operating Partnership, SAM and SS OP Holdings.

Third Amended and Restated Limited Partnership Agreement and Redemption of Limited Partner Interest Agreement

On June 28, 2019, we entered into the Third Amended and Restated Limited Partnership Agreement of the Operating Partnership (the “Operating Partnership Agreement”), which amended and superseded the Second Amended and Restated Limited Partnership Agreement (the “Former OP Agreement”), and a Redemption of Limited Partner Interest Agreement (the “Redemption of Limited Partner Interest Agreement”) with the Former External Advisor and the Operating Partnership, pursuant to which the Operating Partnership redeemed all of the limited partnership interests held by the Former External Advisor in the Operating Partnership. As a result of the Redemption of Limited Partner Interest Agreement and the Self Administration Transaction, the Former External Advisor’s parent entity, SAM and its affiliates no longer hold either their previously existing 20,000 limited partnership units or their special limited partnership interest in the Operating Partnership; however, SAM received cash of $200,000 and also now holds Class A-1 Units and Class A-2 Units in the Operating Partnership, as further described below.

As a result of the entry into the above-described Redemption of Limited Partner Interest Agreement and the Operating Partnership Agreement (1) references to the limited partner interests previously held by the Former External Advisor in the Operating Partnership have been removed from the Operating Partnership Agreement in connection with the redemption of such interests pursuant to the Redemption of Limited Partner Interest Agreement and (2) provisions related to the subordinated incentive distributions payable to the Former External Advisor pursuant to the special limited partnership interests have been removed from the Operating Partnership Agreement. Accordingly, we and our Operating Partnership will no longer have any obligation to make the Subordinated Share of Net Sale Proceeds, Subordinated Distribution Due Upon Termination of Advisory Agreement, Subordinated Incentive Listing Distribution, or Subordinated Distribution Due Upon Extraordinary Transaction (each as defined in the Former OP Agreement).

In addition, the revised Operating Partnership Agreement created two new classes of units ~~to be~~ issued to SS OP Holdings in connection with the Self Administration Transaction: Class A-1 Units and Class A-2 Units.

The Class A-1 Units are subject to the general restrictions on transfer contained in the Operating Partnership Agreement. In addition, until June 28, 2021 (the “Lock-Up Expiration”), the Class A-1 Units may not be sold, pledged, or otherwise transferred or encumbered except in certain limited circumstances set forth in the Contribution Agreement. The Class A-1 Units are otherwise entitled to all rights and duties of the Class A limited partnership units in the Operating Partnership, including cash distributions and the allocation of any profits or losses in the Operating Partnership. The Class A-2 Units may convert into Class A-1 Units as earnout consideration, as described below. The Class A-2 Units are not entitled to cash distributions or the allocation of any profits or losses in the Operating Partnership until the Class A-2 Units are converted into Class A-1 Units.

The conversion features of the Class A-2 Units are as follows: (A) the first time the aggregate incremental assets under management (“AUM”) (as defined in the Operating Partnership Agreement) of the Operating Partnership equals or exceeds $300,000,000, one-third of the Class A-2 Units will automatically convert into Class A-1 Units, (B) the first time the incremental AUM of the Operating Partnership equals or exceeds $500,000,000, an additional one-third of the Class A-2 Units will automatically convert into Class A-1 Units, and (C) the first time the incremental AUM equals or exceeds $700,000,000, the remaining one-third of the Class A-2 Units will automatically convert into Class A-1 Units (each an “Earnout Achievement Date”). On each Earnout Achievement Date, the Class A-2 Units will automatically convert into Class A-1 Units based on an earnout unit exchange ratio, which is equal to $10.66 divided by the then current value of our Class A common stock. The Class A-2 Units conversion rights will expire seven years following the closing date of the Self Administration Transaction. Notwithstanding the foregoing, the earnout consideration will be earned and automatically convert in the event of an “Earnout Acceleration Event” (as defined in the Operating Partnership Agreement), which includes each of the following: certain change of control events (as described in the Operating Partnership Agreement), or H. Michael Schwartz being removed either as a member of our board of directors or as one of our executive officers for any reason other than for cause.

The Operating Partnership Agreement also provides the Class A-1 unitholders a vote on “Extraordinary Matters” which includes any merger, sale of all or substantially all of our assets, share exchange, conversion, dissolution or amendment of our charter, in each case where the vote of our stockholders is required under Maryland law (the “OP Consent”). The OP Consent will be determined by a vote of the partners of the Operating Partnership, with our vote, as General Partner of the Operating Partnership, being voted in proportion to the votes cast by our stockholders on the Extraordinary Matter.

The Redemption of Limited Partner Interest Agreement contained various customary representations and warranties.

On June 28, 2019, immediately following the Self Administration Transaction, SAM and its then wholly-owned subsidiary, 10 Terrace Rd, LLC (“10 Terrace Rd”), and SmartStop Storage Advisors, LLC (“SSA”), our indirect subsidiary, entered into a Membership Interest Purchase Agreement (the “Membership Interest Purchase Agreement”), pursuant to which SSA purchased 100% of the membership interests in 10 Terrace Rd for $6.5 million, payable through the assumption of existing debt in the amount of approximately $4.2 million, and cash in the amount of approximately $2.3 million. 10 Terrace Rd is the owner of an office condominium located at 10 Terrace Rd., Ladera Ranch, California (the “Ladera Office”) which, as a result of the Membership Interest Purchase Agreement, we now indirectly own. The Ladera Office houses our corporate headquarters.

We accounted for the Contribution Agreement and Membership Interest Purchase Agreement discussed above as a business combination under the acquisition method of accounting. During the ~~nine~~six months ended ~~September~~June 30, 2019, we incurred approximately ~~$1.6~~$1.5 million for legal fees and fees and expenses of our other professional and financial advisors related to the Self Administration Transaction, which are included in the self administration transaction expenses line-item in the accompanying consolidated statements of operations.

We are in the process of gathering certain additional information in order to finalize our assessment of the fair value of the consideration transferred; thus, the fair values are preliminary and subject to change. The estimated fair value of the consideration transferred totaled approximately $111.3 million and consisted of the following:

As a result of this acquisition, we remeasured the book value of our preexisting 50% equity method investments in our Tenant Programs joint ventures to fair value, which resulted in a gain of approximately $8.0 million which was presented in the gain resulting from acquisition of unconsolidated affiliates line-item in our consolidated statements of ~~operations.~~operations as of the date of the acquisition. The fair values of the Tenant Programs joint ventures were determined based on a discounted cash flow valuation of the projected cash flows.

The estimated fair value of the Class A-1 Units issued was determined using the Company’s then current net asset value, ~~described above,~~ which was based on an income approach to value the properties and the valuation of the assets acquired in the Self Administration Transaction, as described herein, adjusted for market related adjustments and illiquidity discounts.

These fair value measurements are based on significant inputs not observable in the market and thus represent a Level 3 measurement as discussed in Note 2. The key assumptions used in estimating the fair value of the Class A-1 Units and Class A-2 Units consideration included (i) a marketability discount of 5%, (ii) a capitalization rate of 5.16%, and (iii) annual net operating ~~income of approximately $74 million.~~income.

The estimated fair value of the contingent earnout, Class A-2 Units, was determined using the net asset value calculation described above and further adjusted based on a discounted probability weighted forecast of achieving the requisite AUM thresholds. Subsequent to the completion of the Self Administration Transaction, such liability is required to be recorded at fair value. ~~During~~For additional information, see Note 5 – Self Administration Transaction – Intangible Assets, Goodwill and Certain Other Assets and Liabilities. As of June 30, 2020, we have added incremental assets under management of approximately $184 million since the ~~three months ended September 30, 2019, such liability increased by $300,000 to $31.2 million based on an updated discounted probability weighted forecast.~~close of the Self Administration Transaction.

The consideration transferred pursuant to the Self Administration Transaction was allocated to the assets acquired and liabilities assumed, based upon their ~~preliminary~~ estimated fair values as of the acquisition date. The Company is in the process of gathering certain additional information in order to finalize its assessment of the fair value of the deferred tax liabilities; thus, the provisional measurements are subject to change. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed:

The fair value estimate of property and equipment utilized a combination of the income, cost and market approaches, depending on the characteristics of the asset classification. The fair value of land was determined using the market approach, which considers sales of comparable assets and applies compensating factors for any differences specific to the particular assets. Equipment was valued based on estimated replacement cost. Building and site improvements were valued using the cost approach using a direct cost model built on estimates of replacement cost.

The intangible assets acquired primarily consist of trademarks and the property management and advisory contracts related to the Managed REITs. The value of the property management and advisory contracts were determined based on a discounted cash flow valuation of the projected cash flows of the acquired contracts. The deferred tax liability is the result of differences between the GAAP carrying value of certain amortizing assets and the carrying value for tax purposes related to activities which are conducted through our TRS.

The goodwill recognized iswas supported by several factors, including that the Company ~~is now~~becoming self-managed; additionally, the Managed REIT Platform business brings an established management platform with numerous strategic benefits including growth from new income streams and the ability to offer new products. ~~We have not yet completed our allocation of goodwill to the respective reporting units, pending the finalization of the valuation of the deferred tax liabilities.~~

The results of the acquisition have been included in our consolidated statements of operations since the closing date of the transaction.

In connection with the Membership Interest Purchase Agreement, we, through 10 Terrace Rd, assumed a loan (the "Ladera Office Loan") with KeyBank National Association ("KeyBank") with a principal amount of approximately $4.2 million. The Ladera Office Loan is secured by a first priority deed of trust on the Ladera Office, a promissory note, an assignment of all related leases and rents and a perfected first priority security interests in all personal property, escrows and reserves; additionally, our Operating Partnership provided a non-recourse carve-out guaranty in favor of KeyBank.

~~The Ladera Office Loan accrues interest at a fixed rate of 4.29% per annum through the maturity date of November 1, 2026. The loan contains a number of other customary terms and covenants.~~

In connection with the Contribution Agreement, we assumed a term loan with KeyBank in an amount of approximately $15 million (the “KeyBank Tenant Program Loan”). Pursuant to the assumption of the KeyBank Tenant Program Loan, our Executive Chairman and an entity controlled by him continue to be borrowers under the loan. We provided an indemnity to our Executive Chairman and the entity controlled by him against all obligations under the loan. The KeyBank Tenant Program Loan bears interest at a rate of 1-month Libor plus 350 basis points, resulting in an initial interest rate of approximately 5.90%. Additionally, our Operating Partnership provided a full guaranty in favor of KeyBank.

We are required to reduce the principal balance of the KeyBank Tenant Program Loan to no greater than (i) $14.0 million by December 31, 2019; (ii) $12.5 million by June 30, 2020 and (iii) $11.0 million by December 31, 2020. In addition, the net Tenant Programs revenues received by certain of our subsidiaries, related to the Tenant Programs joint venture interests we acquired in the Self Administration Transaction are required to be deposited in a collateral account maintained by KeyBank and such funds will be applied on a monthly basis first to accrued and unpaid interest and then to the outstanding principal balance of the KeyBank Tenant Program Loan. The KeyBank Tenant Program Loan was paid off in full on October 29, 2019 in connection with the issuance of Series A Preferred Stock. ~~See Note 14 – Subsequent Events for further detail.~~

Fair Value of Equity Exchanged Related to the Redemption of Limited Partnership Interests

In connection with the Redemption of Limited Partner Interest Agreement and the Contribution Agreement, the Former External Advisor redeemed its special limited partnership interest and 20,000 limited partnership units in the Operating Partnership in exchange for $200,000 in cash and Class A-1 Units. The exchange was accounted for as a transaction among equity holders with 0 gain or loss recognized. The fair value of the special limited partnership interest contributed was determined to be approximately $18.8 million, while the book value of the Class A-1 Units issued that was recorded in noncontrolling interest was approximately $9.1 million. The difference between the fair value of the special limited partnership interest received and the book value of the Operating Partnership Units issued was recorded to additional paid in capital.

The estimated fair value of the Class A-1 Units issued was determined consistent with the methodology described above. The fair value of the special limited partnership interest was determined based on discounted projections of the future value of the special limited partnership interest which included various assumptions, including estimated future distributions and the related timing thereto.

On June 28, 2019, we along with our Operating Partnership, the TRS and SSA (collectively, the “Company Parties”) entered into an Administrative Services Agreement with SAM (the “Administrative Services Agreement”), ~~pursuant to~~ which, as amended, requires that the Company Parties will be reimbursed for providing certain operational and administrative services to SAM which may include, without limitation, accounting and financial support, IT support, HR support, advisory services and operations support, and administrative support as set forth in the Administrative Services Agreement and SAM will be reimbursed for providing certain operational and administrative services to the Company Parties which may include, without limitation, due diligence support, marketing, fulfillment and offering support, events support, insurance support, and administrative and facilities support. SAM will receive ~~a monthly administrative service fee~~reimbursement based on the actual costs for providing its services and the Company Parties will receive monthly reimbursement based on ~~the amount of~~actual cost for providing its services ~~provided~~ under the Administrative Services Agreement. SAM will also pay the Company Parties an allocation of rent and overhead for the portion it occupies in the Ladera Office. Such agreement has a term ofthree years and is subject to certain adjustments as defined in the agreement.

Note 5. Self Administration Transaction - Intangible Assets, Goodwill and Certain Other Assets and Liabilities

The emergence and ongoing spread of the COVID-19 pandemic has caused significant volatility in the economy and the capital markets. The increase in consumer and investor uncertainty has had an impact on our Managed REITs, specifically the Managed REITs’ ability to attract investor equity in the face of economic weakness and volatility. Further, starting in April 2020 various broker dealers that our Managed REITs have selling agreements with temporarily halted non-traded REIT sales within their advisory networks. Effective April 30, 2020, the Managed REITs suspended their offerings. Given the disruption that COVID-19 had on our Managed REITs and their ability to raise additional equity, we evaluated the various intangible assets and liabilities associated with the sponsorship of the Managed REITs for impairment as of March 31, 2020.

Based on the above facts, we revised our ~~Operating Partnership entered into a registration rights agreement (the “Registration Rights Agreement”) with SS OP Holdings~~capital raise projections for the Managed REITs. We then evaluated the revised projected undiscounted future cash flows of our amortizing intangible assets to determine if they exceeded their respective carrying values and we determined that certain ~~other parties (collectively,~~trademarks and management contracts acquired in the ~~“Holders”). Pursuant~~Self Administration Transaction were impaired. For such assets we recorded impairments to reduce their carrying value to their respective fair values. For our indefinite-lived trademark we determined that the carrying value was in excess of its fair value and therefore recorded an impairment equal to the ~~Registration Rights Agreement,~~difference. As a result, in March 2020, we recorded impairment charges totaling approximately $11.7 million to intangible assets, consisting of approximately $3.3 million related to our trademarks, approximately $2.2 million related to the ~~Holders have~~management contracts of SST IV and approximately $6.2 million related to the ~~right after~~management contracts of SSGT II. We similarly evaluated goodwill for impairment and determined that the ~~Lock-Up Expiration~~carrying value of the goodwill related to ~~request us~~our Managed REIT segment was in excess of fair value, and therefore impaired and we recognized an impairment charge of approximately $24.7 million. Goodwill related to ~~register for resale under the Securities Act of 1933, as amended, shares of~~ our common stock issued or issuable to such Holder. We are required to use commercially reasonable efforts to file a registration statement on Form S-3 within 30 days of such request and within 60 days of such request in the case of a registration statement on Form S-11 or such other appropriate form. We will cause such registration statement to become effective as soon as reasonably practicable thereafter. The Registration Rights Agreement also grants the Holders certain “piggyback” registration rights after the Lock-Up Expiration.

In connection with the Self Administration Transaction, we ~~entered into severance agreements with each~~acquired a special limited partnership interest in SST IV and SSGT II. This interest, in certain situations, may entitle us to various subordinated distributions under SST IV’s and

SSGT II’s operating partnership agreements. Given the revised capital projections noted above, the projected future subordinated distributions had revised estimated fair values less than their carrying values. We deemed this difference to be an other than temporary decline in value and have therefore recorded an impairment charge of approximately $4.4 million.

As a result of the Self Administration Transaction, we recorded a deferred tax liability, which is the result of differences between the GAAP carrying value of certain amortizing assets and the carrying value for tax purposes of certain assets related to activities which are conducted through our TRS. As we reduced the GAAP carrying value of such assets, primarily the Managed REIT management contracts, we adjusted the value of our ~~executive officers (collectively,~~deferred tax liabilities by pro-rata amounts, reducing the ~~“Severance Agreements”). Each~~deferred tax liabilities in aggregate by approximately $2.4 million, and recorded such adjustment as of March 31, 2020, as other income within the other line-item in our consolidated statement of operations.

In connection with the Self Administration Transaction, we issued the Class A-2 Units, as a form of contingent consideration, which is required to be revalued at each reporting period, based on the discounted probability weighted forecast of achieving the requisite AUM thresholds or the occurrence of an Earnout Acceleration Event. The revised capital raise projections discussed above reduced the probability of the ~~Severance Agreements for our executive officers (collectively,~~Class A-2 Units converting, which had the ~~“Executive Officer Severance Agreements”) provide for separation payments upon~~result of decreasing the ~~termination~~estimated fair value of the ~~executive officer’s employment under various conditions. The level~~contingent earnout liability from $31.1 million as of ~~severance pay depends upon~~December 31, 2019 to $23.9 million as of March 31, 2020, the ~~circumstances~~date of the ~~executive officer’s termination~~impairment analysis. As of ~~employment. If~~June 30, 2020, the ~~executive officer violates any~~estimated fair value of the restrictive covenants set forth in the Executive Officer Severance Agreements, that executive officer’s right to receive severance payments pursuant to the Executive Officer Severance Agreements will end immediately.contingent earnout liability is $24.4 million.

The table set forth below summarizes, on a pro forma basis, the combined results of operations of the Company for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018.~~2019. Such presentation reflects the Company’s acquisitions that occurred during 2019, which met the GAAP definition of a business in effect at that time, as if the acquisitions had occurred as of January 1, 2018. This pro forma information does not purport to represent what the actual consolidated results of operations of the Company would have been for the periods indicated, nor does it purport to predict the results of operations for future periods.

The pro forma financial information for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019 was adjusted to exclude NaN and approximately ~~$1.6~~$1.5 million, ~~and NaN,~~ respectively, for acquisition related expenses.

The weighted average interest rate on our consolidated debt, excluding the impact of our interest rate hedging activities, as of ~~September~~June 30, ~~2019~~2020 was approximately ~~4.9%~~3.74%.

We are subject to certain restrictive covenants relating to the outstanding debt. As of ~~September~~June 30, ~~2019,~~2020, we were in compliance with all such covenants.

On January 24, 2019, in conjunction with the SSGT Mergers, we, through certain wholly-owned special purpose entities, entered into various financings (“SSGT Merger Financings”), as follows:

The proceeds from the SSGT Merger Financings were primarily used to facilitate the SSGT Mergers as previously described, including the payment of the SSGT merger consideration and the repayment, in full, of certain of our debt, as follows:

In conjunction with the SSGT Merger Financings, we recognized a loss on extinguishment of debt of approximately $1.5 million, primarily attributable to prepayment penalties related to the early pay off of the Raleigh/Myrtle Beach promissory note and the write-off of the unamortized loan premium and debt issuance costs on the repaid loans.

This loan is a $235 million commercial mortgage-backed securities (“CMBS”), single-asset/single-borrower (“SASB”) financing (the “CMBS SASB Loan”) with KeyBank, National Association (“KeyBank”) and Citi Real Estate Funding Inc. or its affiliates (“Citibank”), as ~~lender~~initial lenders (together, the “CMBS SASB Lenders”), comprised of (A) a mortgage loan in the amount of $180 million (the “CMBS SASB Mortgage Loan”) and (B) a mezzanine loan in the amount of $55 million (the “CMBS SASB Mezzanine Loan”). The CMBS SASB Mortgage Loan is secured by a first mortgage or deed of trust on each

of 29 wholly owned properties (the “CMBS SASB Properties”), and the CMBS SASB Mezzanine Loan is secured by a pledge of the equity interests in the 29 special purpose entities that own the CMBS SASB Properties. Each loan has a maturity date of February 9, 2022, which may, in certain circumstances, be extended at the option of the respective borrower for 2 consecutive terms of one year each, as set forth in the respective loan agreement (collectively, the “CMBS SASB Loan Agreements”). Monthly payments due under the CMBS SASB Loan Agreements are interest-only, with the full principal amount becoming due and payable on the respective maturity date.

The amounts outstanding under the CMBS SASB Loan Agreements bear interest at an annual rate equal to LIBOR plus 3%. In addition, pursuant to the requirements of the CMBS SASB Loan Agreements: (a) the borrower with respect to the CMBS SASB Mortgage Loan has purchased an interest rate cap with a notional amount of $180 million, with an effective date of January 24, 2019, whereby LIBOR is capped at 3% through February 15, 2022 and (b) the borrower with respect to the CMBS SASB Mezzanine Loan has purchased an interest rate cap with a notional amount of $55 million, with an effective date of January 24, 2019, whereby LIBOR is capped at 3% through February 15, 2022. On June 7, 2019, to effectively terminate our $180 million and $55 million existing interest rate caps, we sold an offsetting interest rate cap with a notional amount of $235 million, whereby LIBOR is capped at 3% through February 15, 2022. We simultaneously entered into an interest rate swap with a notional amount of $235 million, whereby LIBOR is fixed at 1.79% through February 15, 2022. None of the CMBS SASB Loan may be prepaid, in whole or in part, without satisfying certain conditions as set forth in the respective CMBS SASB Loan Agreements, such as the payment of a spread maintenance premium if the prepayment is made within the first two years. Thereafter the CMBS SASB Loan may be prepaid in whole or in part at par without penalty.

The loan documents for the CMBS SASB Loan contain: customary affirmative, negative and financial covenants; agreements; representations; warranties and borrowing conditions; reserve requirements and events of default all as set forth in such loan documents. In addition, and pursuant to the terms of the limited recourse guaranties, with respect to the CMBS SASB Mortgage Loan (the “CMBS SASB Mortgage Loan Guaranty”), and with respect to the CMBS SASB Mezzanine Loan (the “CMBS SASB Mezzanine Loan Guaranty” and collectively the “CMBS SASB Guarantees”), each dated January 24, 2019, in favor of the CMBS SASB Lenders, the Company serves as a non-recourse guarantor with respect to each of the CMBS SASB Mortgage Loan and the CMBS SASB Mezzanine Loan and is subject to certain net worth and liquidity requirements, each as described in the CMBS SASB Guarantees.

The CMBS loan is a $104 million CMBS financing with KeyBank as lender (the “CMBS Lender”) pursuant to a mortgage loan (the “CMBS Loan”), and is secured by a first mortgage or deed of trust on each of 10 wholly owned properties. The loan has a maturity date of February 1, 2029. Monthly payments due under the loan agreement (the “CMBS Loan Agreement”) are interest-only, with the full principal amount becoming due and payable on the maturity date.

The amounts outstanding under the CMBS Loan bear interest at an annual fixed rate equal to 5%. Commencing two years after securitization, the CMBS Loan may be defeased in whole, but not in part, subject to certain conditions as set forth in the CMBS Loan Agreement.

The loan documents for the CMBS Loan contain: customary affirmative, negative and financial covenants; agreements; representations; warranties and borrowing conditions; reserve requirements and events of default all as set forth in such loan documents. In addition, and pursuant to the terms of the limited recourse guaranty dated January 24, 2019, in favor of the CMBS Lender, the Company serves as a non-recourse guarantor with respect to the CMBS Loan.

This represents secured financing with KeyBank, Fifth Third Bank (“Fifth Third”), and SunTrust Bank (“SunTrust”) as equal co-lenders (the “Secured Lenders”) for an amount up to approximately $96.4 million pursuant to a mortgage loan (the “Secured Loan”). At close, the Secured Loan was secured by a first mortgage or deed of trust on each of 16 wholly owned properties. The loan has a maturity date of January 24, 2022, which may, in certain circumstances, be extended at the option of the borrower for 1 additional term equal to one year, as set forth in the Secured Loan Agreement. Monthly payments due under the Secured Loan Agreement are interest-only, with the full principal amount becoming due and payable on the maturity date. On January 24, 2019, an initial borrowing of approximately $89.2 million was made under the Secured

Loan. On July 11, 2019, in conjunction with the acquisition of the Riggs Road Property, the Riggs Road Property was mortgaged pursuant to the terms of the loan agreement (the “Secured Loan Agreement”), and an additional approximate $5.7 million was drawn. On August 30, 2019, we drew an additional approximately $0.5 million from the interest reserve, increasing the then total amount outstanding on the loan to approximately $95.4 million. ~~Subsequent to September 30,~~In October 2019, in connection with the sale of our San Antonio II property, we paid off approximately $9.9 million of the Secured ~~Loan.~~Loan~~See Note 14 – Subsequent Events for further detail.~~.

The amounts outstanding under the Secured Loan Agreement bear interest at an annual rate equal to LIBOR plus 2.5%. On January 24, 2019, the borrowers entered into an interest rate swap arrangement with a notional amount of approximately $89.2 million, such that LIBOR is fixed at approximately 2.6% until August 1, 2020. On October 29, 2019, in connection with the settlement of the Senior Term Loan, we restructured this swap to reduce the notional amount to approximately $85.5 million, an amount equivalent to the then outstanding principal on the Secured Loan. The Secured Loan may be prepaid at any time, subject to certain conditions as set forth in the Secured Loan Agreement.

The loan documents for the Secured Loan contain: customary affirmative, negative and financial covenants; agreements; representations; warranties and borrowing conditions; reserve requirements and events of default all as set forth in such loan documents. In particular, the Secured Loan Agreement imposes certain requirements on the Company such as a total leverage ratio, tangible net worth and liquidity requirements, fixed charge coverage ratios and limits on the amount of unhedged variable rate debt exposure. On May 8, 2020, we completed an amendment to the Secured Loan with the Secured Lenders. The Secured Loan amendment revised certain financial covenants, including increasing the REIT-level liquidity covenant from $10 million to $15 million, and the addition of a REIT-level debt service coverage ratio. Additionally, the amendment added a minimum rate for LIBOR of 0.50%. In addition, and pursuant to the terms of the full recourse guaranty (the “Secured Loan Guaranty”), dated January 24, 2019, in favor of the Secured Lenders, we, along with our Operating Partnership serve as full recourse guarantors with respect to the Secured Loan.

W~~e along with our Operating Partnership~~ ~~entered into a financing for an amount up to $87.7 million with KeyBank and SunTrust, as co-lenders (the “Senior Term Lenders”), pursuant to a senior term loan (the “Senior Term Loan”).~~ The Senior Term Loan is secured by a pledge of 49% of the equity interests in our property-owning special purpose entities, other than those that own the CMBS SASB Properties. The net proceeds from certain capital events (after payment of transaction costs) must be applied to repayment of the Senior Term Loan, except in certain transactions whereby up to $50 million in equity issuances by us and our Operating Partnership may be excluded (the “Capital Event Net Proceeds”). In addition, the Senior Term Loan is secured by a pledge of the Capital Event Net Proceeds. The Senior Term Loan was made pursuant to a loan agreement with a maturity date of January 24, 2022 (the “Senior Term Loan Agreement”). Monthly payments due under the Senior Term Loan Agreement are interest-only, with the full principal amount becoming due and payable on the maturity date. On January 24, 2019, an initial borrowing of $72.0 million was made under the Senior Term Loan with the right to draw an additional $15.7 million as set forth in the Senior Term Loan Agreement. During the nine months ended September 30, 2019, we drew a total of an additional $14.3 million, increasing our outstanding balance to $86.3 million as of September 30, 2019.

The amounts outstanding under the Senior Term Loan Agreement bear interest at an annual rate equal to LIBOR plus 4.25%. On January 24, 2019, we entered into an interest rate swap arrangement with a notional amount of $72 million, such that LIBOR is fixed at approximately 2.6% until August 1, 2020. The Senior Term Loan may be prepaid at any time, subject to certain conditions as set forth in the Senior Term Loan Agreement.

The loan documents for the Senior Term Loan contain: customary affirmative, negative and financial covenants; agreements; representations; warranties and borrowing conditions; reserve requirements and events of default all as set forth in such loan documents. In particular, the Senior Loan Agreement imposes certain requirements such as a total leverage ratio, tangible net worth and liquidity requirements, fixed charge coverage ratios and limits on the amount of unhedged variable rate debt exposure. The Senior Term Loan is fully recourse to us and our Operating Partnership.

~~The Senior Term Loan was paid off in full on October 29, 2019 in connection with the issuance of Series A Preferred Stock.~~ ~~See Note 14 – Subsequent Events for further detail.~~

On October 11, 2018, we, through 10 special purpose entities wholly owned by our Operating Partnership, entered into a loan agreement with CitiBank, N.A. (“CitiBank”), as lender. Under the terms of the loan agreement (the “CitiBank Loan Agreement”), we have a maximum borrowing capacity of $112 million CAD, of which we initially borrowed $99.3 million CAD (the “Initial Proceeds”). The Initial Proceeds were primarily used to pay off all of the existing loans encumbering 10 of our properties located in the greater Toronto area, Canada, all of which now serve as collateral under the CitiBank Loan Agreement. As of ~~September~~June 30, ~~2019,~~2020, we had an outstanding balance of ~~$109.3~~$111.3 million CAD, and have the right to receive future advances in the aggregate amount of up to $2.7 million CAD, subject to certain conditions as set forth in the CitiBank Loan Agreement. Subsequent to September 30, 2019, we drew an additional $2.0 million CAD, and have the right to receive a future advance of up to $0.7 million CAD, subject to certain conditions as set forth in the CitiBank Loan Agreement.

The CitiBank Loan Agreement is a term loan that matures on October 9, 2020, which may, in certain circumstances, be extended at our option for 3 consecutive terms of one year each. Monthly payments due under the CitiBank Loan Agreement are interest-only, with the full principal amount becoming due and payable on the maturity date.

The amounts outstanding under the CitiBank Loan Agreement bear interest at a rate equal to the sum of the “CDOR” (as defined in the CitiBank Loan Agreement) and 2.25%. If we exercise our third extension option, the interest rate shall be increased by 0.25%. In addition, pursuant to the requirements of the CitiBank Loan Agreement, we have purchased interest rate caps with a combined notional amount of $112 million CAD, whereby the CDOR is capped at 3.00% through October 15, 2021.

The following table presents the future principal payment requirements on outstanding debt as of June 30, 2020:

On October 29, 2019 (the “Commitment Date”), we entered into a preferred stock purchase agreement (the “Purchase Agreement”) with Extra Space Storage LP (the “Investor”), a subsidiary of Extra Space Storage Inc. (NYSE: EXR), pursuant to which the Investor committed to purchase up to $200 million in preferred shares (the aggregate shares to be purchased, the “Preferred Shares”) of our new Series A Convertible Preferred Stock (the “Series A Convertible Preferred Stock”), in one or more closings (each, a “Closing,” and collectively, the “Closings”). The initial closing (the “Initial Closing”) in the amount of $150 million occurred on the Commitment Date. The Investor has committed to purchase up to an additional $50 million, at our option, within 12 months following the Initial Closing, subject to certain limitations. We pay the Investor a fee of 0.25% per annum on the remaining commitment amount until drawn, or the 12-month anniversary of the Initial Closing. We incurred approximately $3.6 million in issuance costs related to the Series A Convertible Preferred Stock, which are recorded as a reduction to Series A Convertible Preferred stock on our consolidated balance sheets.

The shares of Series A Convertible Preferred Stock rank senior to all other shares our capital stock, including our common stock, with respect to rights to receive dividends and to participate in distributions or payments upon any voluntary or involuntary liquidation, dissolution or winding up of the Company. Dividends payable on each share of Series A Convertible Preferred Stock will initially be equal to a rate of 6.25% per annum. If the Series A Convertible Preferred Stock has not been redeemed on or prior to the fifth anniversary date of the Initial Closing, the dividend rate will increase an additional 0.75% per annum each year thereafter to a maximum of 9.0% per annum until the tenth anniversary of the Initial Closing, at which time the dividend rate shall increase 0.75% per annum each year thereafter until the Series A Convertible Preferred Stock is redeemed or repurchased in full. The dividends are payable in arrears for the prior calendar quarter on or before the 15^th day of March, June, September and December of each year.

Upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series A Convertible Preferred Stock will be entitled to receive a payment equal to the greater of (i) aggregate purchase price of all outstanding Preferred Shares, plus any accrued and unpaid dividends (the “Liquidation Amount”) and (ii) the amount that that would have been payable had the Preferred Shares been converted into common stock pursuant to the terms of the Purchase Agreement immediately prior to such liquidation.

Subject to certain additional redemption rights, as described herein, we have the right to redeem the Series A Convertible Preferred Stock for cash at any time following the fifth anniversary of the Initial Closing. The amount of such redemption will be equal to the Liquidation Amount. Upon the listing of our common stock on a national securities exchange (the “Listing”), we have the right to redeem any or all outstanding Series A Convertible Preferred Stock at an amount equal to the greater of (i) the amount that would have been payable had such Preferred Shares been converted into common stock pursuant to the terms of the Purchase Agreement immediately prior to the Listing, and then all of such Preferred Shares were sold in the Listing, or (ii) the Liquidation Amount, plus a premium amount (the “Premium Amount”) of 10%, 8%, 6%, 4%, or 2% if redeemed prior to the first, second, third, fourth, or fifth anniversary dates of issuance, respectively, or 0% if redeemed thereafter, as set forth in the Articles Supplementary. Upon a change of control event, we have the right to redeem any or all outstanding Series A Convertible Preferred Stock at an amount equal to the greater of (i) the amount that would have been payable had the Preferred Shares been converted into common stock pursuant to the terms of the Purchase

~~Amended KeyBank Credit Facility~~Agreement immediately prior to such change of control or (ii) the Liquidation Amount, plus the Premium Amount, as set forth in the Articles Supplementary. In addition, subject to certain cure provisions, if we fail to maintain our status as a real estate investment trust, the holders of Series A Convertible Preferred Stock have the right to require us to repurchase the Series A Convertible Preferred Stock at an amount equal to the Liquidation Amount with 0 Premium Amount.

~~On December 22, 2015,~~At any time after the earlier to occur of (i) the second anniversary of the Initial Closing or (ii) 180 days after a Listing, the holders of Series A Convertible Preferred Stock have the right to convert any or all of the Series A Convertible Preferred Stock held by such holders into common stock at a rate per share equal to the quotient obtained by dividing the Liquidation Amount by the conversion price. The conversion price is $10.66, as may be adjusted in connection with stock splits, stock dividends and other similar transactions.

The holders of Series A Convertible Preferred Stock are not entitled to vote on any matter submitted to a vote of our stockholders, except that in the event that the dividend for the Series A Convertible Preferred Stock has not been paid for at least four quarters (whether or not consecutive), the holders of Series A Convertible Preferred Stock have the right to vote together with our stockholders on any matter submitted to a vote of our stockholders, upon which the holders of the Series A Convertible Preferred Stock and holders of common stock shall vote together as a single class. The number of votes applicable to a share of Series A Convertible Preferred Stock will be equal to the number of shares of common stock a share of Series A Convertible Preferred Stock could have been converted into as of the record date set for purposes of such stockholder vote. This foregoing limited voting right shall cease when all past dividend periods have been paid in full. In addition, the affirmative vote of the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock is required in certain customary circumstances, as well as other circumstances, such as (i) our real estate portfolio exceeding a leverage ratio of 60% loan-to-value, (ii) entering into certain transactions with our Executive Chairman as of the Commitment Date, or his affiliates, (iii) effecting a merger (or similar) transaction with an entity whose assets are not at least 80% self storage related and (iv) entering into any line of business other than self storage and ancillary businesses, unless such ancillary business represents revenues of less than 10% of our revenues for our last fiscal year.

In connection with the issuance of the Series A Convertible Preferred Stock, we ~~through our Operating Partnership,~~ and ~~certain affiliated entities~~the Investor also entered into an ~~amended~~investors’ rights agreement (the “Investors’ Rights Agreement”) which provides the Investor with certain customary protections, including demand registration rights and ~~restated revolving credit facility (the “Amended KeyBank Credit Facility”)~~“piggyback” registration rights with ~~KeyBank National Association (“KeyBank”), as administrative agent and KeyBanc Capital Markets, LLC, as~~respect to our common stock issued to the ~~sole book runner and sole lead arranger, and Texas Capital Bank, N.A., and Comerica Bank as co-lenders.The Amended KeyBank Credit Facility was a revolving loan~~Investor upon conversion of the Preferred Shares.

As of June 30, 2020, there were 150,000 Preferred Shares outstanding with an ~~initial term~~aggregate liquidation preference of ~~three years, initially set to mature~~approximately $152.4 million, which consisted of $150 million from the Initial Closing, approximately $2.3 million of accumulated and unpaid distributions, and approximately $0.1 million of accumulated and unpaid fees on ~~December 22, 2018, with 2 one-year extension options subject to certain conditions outlined further in~~ the ~~credit agreement for the Amended KeyBank Credit Facility. On October 29, 2018, we amended our Amended KeyBank Credit Facility to extend the maturity date until February 20, 2019 and reduce the maximum borrowing capacity from $145 million to $110 million.~~ undrawn commitment. As of December 31, ~~2018, we had~~2019, there were 150,000 Preferred Shares outstanding with an aggregate liquidation preference of approximately ~~$98.8~~$151.7 million, ~~in borrowings outstanding under~~which consisted of $150 million from the ~~Amended KeyBank Credit Facility. On January 24, 2019, we paid off~~Initial Closing, approximately $1.7 million of accumulated and ~~terminated~~unpaid distributions, and approximately $0.1 million of accumulated and unpaid fees on the ~~Amended KeyBank Credit Facility in conjunction with the SSGT Mergers.~~undrawn commitment.

~~The following table presents the future principal payment requirements on outstanding debt as of September 30, 2019:~~

Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate movements. To accomplish this objective, we use interest rate swaps and caps as part of our interest rate risk management strategy. The effective portion of the change in the fair value of the derivative that qualifies as a cash flow hedge is recorded in accumulated other comprehensive income (loss) (“AOCI”) and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in AOCI related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt.

We do not use interest rate derivatives for trading or speculative purposes. Derivatives not designated as hedges are not speculative and are used to manage our exposure to interest rate movements and other identified risks but we have elected

not to apply hedge accounting. Changes in the fair value of interest rate derivatives not designated in hedging relationships are recorded in other income (expense) as income within our consolidated statements of ~~operations and was approximately $20,000 for both the three and nine months ended September 30, 2019.~~operations.

Our objectives in using foreign currency derivatives are to add stability to potential fluctuations in exchange rates between foreign currencies and the U.S. dollar and to manage our exposure to exchange rate movements. To accomplish this objective, we use foreign currency forwards and foreign currency options as part of our exchange rate risk management strategy. A foreign currency forward contract is a commitment to deliver a certain amount of currency at a certain price on a specific date in the future. By entering into the forward contract and holding it to maturity, we are locked into a future currency exchange rate in an amount equal to and for the term of the forward contract. A foreign currency option contract is a commitment by the seller of the option to deliver, solely at the option of the buyer, a certain amount of currency at a certain price on a specific date. For derivatives designated as net investment hedges, the changes in the fair value of the derivatives are reported in accumulated other comprehensive income. Amounts are reclassified out of accumulated other comprehensive income (loss) into earnings when the hedged net investment is either sold or substantially liquidated.

The following table summarizes the terms of our derivative financial instruments as of ~~September~~June 30, ~~2019:~~2020:

On ~~March 28, 2018~~January 25, 2019, we settled ~~our existing $101 million CAD foreign currency forward contract, receiving a net settlement of approximately $2.2 million and simultaneously entered into~~ a $90 million CAD foreign currency ~~forward. We settled the $90 million CAD foreign currency~~ forward, ~~on January 25, 2019,~~ receiving a net settlement of approximately $2.1 million and simultaneously entered into a $95 million CAD foreign currency forward. On July 8, 2019, we settled the $95 million CAD foreign currency forward, paying a net settlement of approximately $0.6 million and simultaneously entered into a $95 million CAD currency option. On December 9, 2019 the CAD currency option expired and we simultaneously entered into a two month $95 million CAD foreign currency forward. On February 10, 2020, we settled the CAD currency forward, receiving a net settlement of approximately $0.5 million and simultaneously entered into a one year $95 million CAD foreign currency forward.A portion of our gain (loss) from our settled and unsettled foreign currency hedges is recorded net in foreign currency hedge contract gain (loss) in our consolidated statements of comprehensive loss, ~~and~~the other portion, a loss of approximately ~~$13,000~~$0.5 million and ~~$0.6~~a gain of approximately $0.5 million related to the ineffective portion is recorded in other income (expense) within our consolidated statements of operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, respectively.

The following table summarizes the terms of our derivative financial instruments as of December 31, ~~2018:~~2019:

The following table presents a gross presentation of the fair value of our derivative financial instruments as well as their classification on our consolidated balance sheets as of ~~September~~June 30, ~~2019~~2020 and December 31, ~~2018:~~2019:

WePrior to the Self Administration Transaction on June 28, 2019, we internally evaluated all of our properties and interests therein as one industry segment and, accordingly, did not report segment information.

Subsequent to the Self Administration Transaction, we now operate in 2 reportable business segments: (i) self storage operations and (ii) our Managed REIT Platform business.

Management evaluates performance based upon ~~property~~ net operating income (“NOI”). For our self storage operations, NOI is defined as leasing and related revenues, less property level operating expenses. NOI for the Company’s Managed REIT Platform business represents Managed REIT Platform revenues less Managed REIT Platform expenses.

The following ~~table~~tables summarizes information for the reportable segments for the three ~~and nine~~ months ended ~~September~~June 30, ~~2019~~2020 below:

The following tables summarizes information for the reportable segments for the six months ended June 30, 2020 below:

	Three Months Ended September 30, 2019												Six Months Ended June 30, 2020
				Managed REIT			Corporate									Managed REIT			Corporate
	Self Storage			Platform			and Other			Total			Self Storage			Platform			and Other			Total
Revenues:
Self storage rental revenue	$	25,669,615		$	—		$	—		$	25,669,615		$	50,514,812		$	—		$	—		$	50,514,812
Ancillary operating revenue		1,188,934			—			—			1,188,934			2,336,261			—			—			2,336,261
Managed REIT Platform revenue		—			1,192,665			—			1,192,665			—			3,636,680			—			3,636,680
Reimbursable costs from Managed REITs		—			1,536,800			—			1,536,800			—			3,279,915			—			3,279,915
Total revenues		26,858,549			2,729,465			—			29,588,014			52,851,073			6,916,595			—			59,767,668
Operating expenses:
Property operating expenses		9,655,599			—			—			9,655,599			18,870,069			—			—			18,870,069
Managed REIT Platform expense		—			1,248,665			—			1,248,665			—			2,182,823			—			2,182,823
Reimbursable costs from Managed REITs		—			1,536,800			—			1,536,800			—			3,279,915			—			3,279,915
General and administrative		—			—			3,519,557			3,519,557			—			—			7,817,660			7,817,660
Depreciation		7,470,184			—			169,006			7,639,190			15,321,826			—			237,288			15,559,114
Intangible amortization expense		2,503,987			1,237,059			—			3,741,046			4,388,682			2,499,101			—			6,887,783
Contingent earnout expense		—			—			300,000			300,000
Self administration transaction expenses		—			—			107,100			107,100
Other property acquisition expenses		25,529			—			—			25,529
Other acquisition expenses														125,326			—			—			125,326
Contingent earnout adjustment														—			(6,700,000	)		—			(6,700,000	)
Impairment of goodwill and intangible assets														—			36,465,732			—			36,465,732
Impairment of investments in Managed REITs														—			4,376,879			—			4,376,879
Total operating expenses		19,655,299			4,022,524			4,095,663			27,773,486			38,705,903			42,104,450			8,054,948			88,865,301
Operating income		7,203,250			(1,293,059	)		(4,095,663	)		1,814,528
Operating income (loss)														14,145,170			(35,187,855	)		(8,054,948	)		(29,097,633	)
Other income (expense):
Interest expense		(10,214,822	)		—			(46,114	)		(10,260,936	)		(16,533,565	)		—			(90,167	)		(16,623,732	)
Interest expense – accretion of fair market value of secured debt		33,191			—			—			33,191			65,549			—			—			65,549
Interest expense – debt issuance costs		(1,082,543	)		—			—			(1,082,543	)		(1,875,043	)		—			(4,718	)		(1,879,761	)
Other		(106,450	)		60,631			—			(45,819	)		(335,272	)		2,917,497			146,930			2,729,155
Net loss	$	(4,167,374	)	$	(1,232,428	)	$	(4,141,777	)	$	(9,541,579	)	$	(4,533,161	)	$	(32,270,358	)	$	(8,002,903	)	$	(44,806,422	)

	Nine Months Ended September 30, 2019
				Managed REIT			Corporate
	Self Storage			Platform			and Other			Total
Revenues:
Self storage rental revenue	$	74,056,235		$	—		$	—		$	74,056,235
Ancillary operating revenue		2,589,985			—			—			2,589,985
Managed REIT Platform revenue		—			1,221,727			—			1,221,727
Reimbursable costs from Managed REITs		—			1,583,909			—			1,583,909
Total revenues		76,646,220			2,805,636			—			79,451,856
Operating expenses:
Property operating expenses		26,630,201			—			—			26,630,201
Property operating expenses – affiliates		6,605,670			—			—			6,605,670
Managed REIT Platform expense		—			1,259,234			—			1,259,234
Reimbursable costs from Managed REITs		—			1,583,909			—			1,583,909
General and administrative		—			—			7,000,627			7,000,627
Depreciation		21,750,206			—			177,902			21,928,108
Intangible amortization expense		6,524,347			1,298,007			—			7,822,354
Contingent earnout expense		—			—			300,000			300,000
Self administration transaction expenses		—			—			1,595,371			1,595,371
Acquisition expenses – affiliates		84,061			—			—			84,061
Other property acquisition expenses		109,765			—			—			109,765
Total operating expenses		61,704,250			4,141,150			9,073,900			74,919,300
Operating income		14,941,970			(1,335,514	)		(9,073,900	)		4,532,556
Other income (expense):
Interest expense		(28,537,117	)		—			(47,623	)		(28,584,740	)
Interest expense – accretion of fair market value of secured debt		98,850			—			—			98,850
Interest expense – debt issuance costs		(2,997,801	)		—			—			(2,997,801	)
Net loss on extinguishment of debt		(1,487,867	)		—			—			(1,487,867	)
Gain resulting from acquisition of unconsolidated affiliates		8,017,353			—			—			8,017,353
Other		(414,871	)		62,652			—			(352,219	)
Net loss	$	(10,379,483	)	$	(1,272,862	)	$	(9,121,523	)	$	(20,773,868	)

The following tables summarizes information for the reportable segments for the three months ended June 30, 2019 below:

The following tables summarizes information for the reportable segments for the six months ended June 30, 2019 below:

The following table summarizes our total assets by ~~segment:~~segment as of June 30, 2020:

Through the closing of the Self Administration Transaction on June 28, 2019, we incurred expenses under the following advisory and property management agreements; commencing on such closing and continuing thereafter we ~~will~~ no longer incur such expenses. The Dealer Manager Agreement and the Transfer Agent Agreement described below were not impacted by the Self Administration Transaction.

Our Advisory Agreement with our Former External Advisor, our dealer manager agreement, as amended ("Dealer Manager Agreement") with our Dealer Manager, our Property Management Agreements with our Former External Property Managers and our Transfer Agent Agreement with our Transfer Agent entitle such affiliates to specified fees upon the provision of certain services with regard to ~~the~~our Offering and investment of funds in real estate properties, among other services, as well as certain reimbursements, as described below.

Prior to the Self Administration Transaction we did not have any employees. Our Former External Advisor was primarily responsible for managing our business affairs and carrying out the directives of our board of directors. Our Former External Advisor received various fees and expenses under the terms of our Advisory Agreement. As a result of the Self Administration Transaction, on June 28, 2019, we acquired approximately 350 self storage professionals and other personnel and now perform such services on our own behalf.

Our Advisory Agreement also required our Former External Advisor to reimburse us to the extent that offering expenses, including sales commissions, dealer manager fees, stockholder servicing fees and organization and offering expenses, were in excess of 15% of gross proceeds from the Offering. However, subsequent to the termination of our Primary Offering on January 9, 2017, we determined offering expenses were not in excess of 15% of gross proceeds from the Offering, and thus there was 0 reimbursement.

Our Former External Advisor received acquisition fees equal to 1.75% of the contract purchase price of each property we acquired plus reimbursement of any acquisition expenses incurred by our Former External Advisor. Our Former External Advisor also received a monthly asset management fee equal to 0.05208%, which is one-twelfth of 0.625%, of our aggregate asset value, as defined in the Advisory Agreement.

Under our Advisory Agreement, our Former External Advisor was entitled to receive disposition fees in an amount equal to the lesser of (i) one-half of the competitive real estate commission or (ii) 1% of the contract sale price for each property we sold, as long as our Former External Advisor provided substantial assistance in connection with the sale. The total real estate commissions paid (including the disposition fee paid to our Advisor) was limited to the lesser of a competitive real estate commission or an amount equal to 6% of the contract sale price of the property.

Our Former External Advisor was also entitled to various subordinated distributions pursuant to our Operating Partnership Agreement if we (1) listed our shares of common stock on a national exchange, (2) terminated our Advisory Agreement (other than a voluntary termination), (3) liquidated our portfolio, or (4) entered into an Extraordinary Transaction, as it was defined in the Operating Partnership Agreement.

Pursuant to the Advisory Agreement, our Former External Advisor was entitled to reimbursement of our Former External Advisor’s direct and indirect costs of providing administrative and management services to us. Pursuant to the Advisory Agreement, our Former External Advisor was obligated to pay or reimburse us the amount by which our aggregate annual operating expenses, as defined, exceeded the greater of 2% of our average invested assets or 25% of our net income, as defined, unless a majority of our independent directors determined that such excess expenses were justified based on unusual and non-recurring factors.

In connection with our Primary Offering, our Dealer Manager received a sales commission of up to 7.0% of gross proceeds from sales of Class A Shares and up to 2.0% of gross proceeds from the sales of Class T Shares in the Primary Offering and a dealer manager fee up to 3.0% of gross proceeds from sales of both Class A Shares and Class T Shares in the Primary Offering under the terms of the Dealer Manager Agreement. In addition, our Dealer Manager receives an ongoing stockholder servicing fee that is payable monthly and accrues daily in an amount equal to 1/365th of 1% of the purchase price per share of the Class T Shares sold in the Primary Offering. We will cease paying the stockholder servicing fee with respect to the Class T Shares sold in the Primary Offering at the earlier of (i) the date we list our shares on a national securities exchange, merge or consolidate with or into another entity, or sell or dispose of all or substantially all of our ~~assets,~~assets; (ii) the date at which the aggregate underwriting compensation from all sources equals 10% of the gross proceeds from the sale of both Class A Shares and Class T Shares in our Primary Offering (i.e., excluding proceeds from sales pursuant to our distribution reinvestment plan), which calculation shall be made by us with the assistance of our Dealer Manager commencing after the termination of the Primary Offering; (iii) the fifth anniversary of the last day of the fiscal quarter in which our Primary Offering (i.e., excluding our distribution reinvestment plan offering) terminated; and (iv) the date that such Class T Share is redeemed or is no longer outstanding. Our Dealer Manager entered into participating dealer agreements with certain other broker-dealers which authorized them to sell our shares. Upon sale of our shares by such broker-dealers, our Dealer Manager re-allowed all of the sales commissions and, subject to certain limitations, the stockholder servicing fees paid in connection with sales made by these broker-dealers. Our Dealer Manager could also re-allow to these broker-dealers a portion of their dealer manager fee as marketing fees, reimbursement of certain costs and expenses of attending training and education meetings sponsored by our Dealer Manager, payment of attendance fees required for employees of our Dealer Manager or other affiliates to attend retail seminars and public seminars sponsored by these broker-dealers, or to defray other distribution-related expenses. Our Dealer Manager also received reimbursement of bona fide due diligence expenses; however, to the extent these due diligence expenses could not be justified, any excess over actual due diligence expenses would have been considered underwriting compensation subject to a 10% FINRA limitation and, when aggregated with all other non-accountable expenses in connection with our Offering, could not exceed 3% of gross offering proceeds from sales in the Offering.

SAM owns a 15% non-voting equity interest in our Dealer Manager. Affiliates of our Dealer Manager own limited partnership interests in our Operating Partnership.

SAM isowns 100% of the ~~owner and manager~~membership interests of ~~our~~Strategic Transfer Agent Services, LLC, our transfer agent (“Transfer Agent”), which is a registered transfer agent with the SEC. Pursuant to our transfer agent agreement, our Transfer Agent provides transfer agent and registrar services to us. These services are substantially similar to what a third party transfer agent would provide in the ordinary course of performing its functions as a transfer agent, including, but not limited to: providing customer service to our stockholders, processing the distributions and any servicing fees with respect to our shares and issuing regular reports to our stockholder. Our Transfer Agent may retain and supervise third party vendors in its efforts to administer certain services. We believe that our Transfer Agent, through its knowledge and understanding of the direct participation program industry which includes non-traded REITs, is particularly suited to provide us with transfer agent and registrar services. Our Transfer Agent also conducts transfer agent and registrar services for other non-traded REITs sponsored by SRA.

It is the duty of our board of directors to evaluate the performance of our Transfer Agent. In connection with the engagement of our Transfer Agent, we paid a one-time initial setup fee of $50,000. In addition, the other fees to beFees paid to our Transfer Agent are based on a fixed quarterly fee, one-time account setup fees and monthly open account fees. In addition, we will reimburse our Transfer Agent for all reasonable expenses or other changes incurred by it in connection with the provision of its services to us, and we will pay our Transfer Agent fees for any additional services we may request from time to time, in accordance with its rates then in effect. Upon the request of our Transfer Agent, we may also advance payment for substantial reasonable out-of-pocket expenditures to be incurred by it.

The initial term of the transfer agent agreement is three years, which term will be automatically renewed for one year successive terms, but either party may terminate the transfer agent agreement upon 90 days’ prior written notice. In the event that we terminate the transfer agent agreement, other than for cause, we will pay our transfer agent all amounts that would have otherwise accrued during the remaining term of the transfer agent agreement; provided, however, that when calculating the remaining months in the term for such purposes, such term is deemed to be a 12 month period starting from the date of the most recent annual anniversary date.

~~Prior to the Self Administration Transaction our properties were managed by our~~ ~~Former External Property Managers pursuant to property management agreements. However, as~~As a result of the Self Administration Transaction, we acquired approximately 350 self storage professionals and other personnel and now perform ~~such~~property management services on our own behalf.

~~Pursuant~~Through June 28, 2019, pursuant to ~~our amended~~the property management agreements, our Former External Property Managers received: (i) a monthly management fee for each property equal to the greater of $3,000 or 6% of the gross revenues from the properties plus reimbursement of the property manager’s costs of managing the properties and (ii) a construction management fee equal to 5% of the cost of construction or capital improvement work in excess of $10,000. In addition, we had agreed with our Former External Property Managers or an affiliate to share equally in the net revenue attributable to the sale of ~~Tenant Programs~~tenant insurance, protection plans, or other indemnity plans at our properties. With respect to each new property we acquired for which we entered into a property management agreement with our Former External Property Managers we paid our Former External Property Managers a one-time start-up fee in the amount of $3,750.

Our self storage properties located in Canada were subject to separate property management agreements with our Former External Property Managers on terms substantially the same as the amended property management agreements described above.

All of our properties in the United States and Canada are operated under the “SmartStop® Self Storage” brand, which as a result of the Self Administration Transaction we now own.

Pursuant to the terms of the agreements described above, the following table summarizes related party costs incurred and paid by us for the year ended December 31, ~~2018~~2019, and the ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, as well as any related amounts payable as of December 31, ~~2018~~2019 and ~~September~~June 30, ~~2019:~~2020:

Please see Note 3 – Real Estate Facilities and Note 4 – Self Administration Transaction for detail regarding additional related party transactions.

We may offer a tenant insurance plan, tenant protection plan or similar program (collectively “Tenant Programs”) to customers at our ~~properties pursuant to which we agreed with our Former External Property Manager or an affiliate to share equally in the net revenue attributable to the sale of Tenant Programs at our~~ properties.

~~In order to protect the interest of the Former External Property Manager in receiving such revenues, we~~ We and an affiliate of our Former External Property Manager previously agreed to transfer our respective rights in such Tenant Programs revenue to a joint venture owned 50% by our TRS subsidiary and, through the date of the Self Administration Transaction, 50% by our Former External Property Manager’s affiliate (the “Former PM Affiliate”). Under the terms of the joint venture agreement, the TRS received 50% of the net economics generated from such Tenant Programs and the Former PM Affiliate received the other 50% 50% of such net economics. In addition, we ~~share~~shared equally in the net revenue attributable to the sale of Tenant Programs at the properties we acquired in the SSGT Mergers on substantially similar terms as set forth above. In connection with the Self Administration Transaction we now wholly-own both such Tenant Programs joint venture ~~entities.~~entities.

For the three and ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, we recorded net revenues of approximately $1.0 million and ~~$2.0~~$1.9 million, respectively, related to Tenant Programs which was included in ancillary operating revenue in the consolidated statements of operations. For the three and ~~nine~~six months ended ~~September~~June 30, ~~2018,~~2019, we recorded net revenues of approximately ~~$0.4~~$0.6 million and ~~$1.1~~$1.0 million, respectively, related to Tenant Programs which was included in ancillary operating revenue in the consolidated statements of operations.

In connection with the Self Administration Transaction we now own a minority interest in a company that owns 50% of an online auction company (the “Auction Company”) that serves as a web portal for self storage companies to post their auctions for the contents of abandoned storage units online instead of using live auctions conducted at the self storage facilities. The Auction Company receives a service fee for such services. During the three and nine months ended September 30, 2019, we paid approximately $11,000 and $34,000, respectively, in fees to the Auction Company related to our properties. During the three and nine months ended September 30, 2018, we paid approximately $15,000 and $30,000, respectively, in fees to the Auction Company related to our properties. Our properties receive the proceeds from such online auctions.

Acquisition of Self Storage Platform from SmartStop Asset Management, LLC and Other Transactions

As a result of the Self Administration Transaction, the advisor and property manager entities of SST IV and SSGT II, became our indirect subsidiaries. As a result, we are entitled to receive various fees and expense reimbursements under the terms of the SST IV and SSGT II advisory and property management agreements as described below.

Our indirect subsidiaries, Strategic Storage Advisor IV, LLC, the advisor to SST IV (the “SST IV Advisor”), and SS Growth Advisor II, LLC, the advisor to SSGT II (the “SSGT II Advisor”), are entitled to receive various fees and expense reimbursements under the terms of the SST IV and SSGT II advisory agreements.

The SST IV Advisor provides acquisition and advisory services to SST IV pursuant to an advisory agreement (the “SST IV Advisory Agreement”). SST IV is required to reimburse SST IV Advisor for organization and offering costs under the SST IV Advisory Agreement; however, the SST IV Advisor ~~will fund,~~funds, and will not be reimbursed for 1.15% of the gross offering proceeds from the sale of ~~class~~Class W shares sold in the SST IV offering. Such amounts for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 totaled approximately ~~$30,000.~~$2,000 and $25,000, respectively. The SST IV Advisor will be required to reimburse SST IV within 60 days after the end of the month in which the SST IV public offering terminates to the extent SST IV paid or reimbursed organization and offering costs (excluding sales commissions and dealer manager fees) in excess of 3.5% of the gross offering proceeds from the SST IV offering. The SST IV Advisory Agreement also requires the SST IV Advisor to reimburse SST IV to the extent that offering expenses, including sales commissions, dealer manager fees and organization and offering expenses, are in excess of 15% of gross proceeds from the SST IV offering.

The SST IV Advisor ~~will~~ also ~~receive~~receives a monthly asset management fee equal to 0.0833%, which is one-twelfth of 1%, of SST IV’s aggregate asset value, as defined.

The SST IV Advisor may potentially also be entitled to various subordinated distributions under ~~the~~ SST IVIV’s operating partnership agreement pursuant to the special limited partnership interest and its cash flow participation distribution rights if SST IV (1) lists its shares of common stock on a national exchange, (2) terminates the SST IV Advisory Agreement, (3) liquidates its portfolio, or (4) enters into an Extraordinary Transaction, as defined in the SST IV operating partnership agreement.

The SST IV Advisory Agreement provides for reimbursement of the SST IV Advisor’s direct and indirect costs of providing administrative and management services to SST IV. The SST IV Advisor will be required to pay or reimburse SST IV the amount by which SST IV’s aggregate annual operating expenses, as defined, exceed the greater of 2% of SST IV’s average invested assets or 25% of SST IV’s net income, as defined, unless a majority of SST IV’s independent directors determine that such excess expenses were justified based on unusual and non-recurring factors.

The SSGT II Advisor provides acquisition and advisory services to SSGT II pursuant to an advisory agreement (the “SSGT II Advisory Agreement”). In connection with the SSGT II private placement offering, SSGT II is required to reimburse the SSGT II Advisor for organization and offering costs from the SSGT II private offering pursuant to the SSGT II Advisory Agreement.

The SSGT II Advisor will receive a monthly asset management fee equal to 0.1042%, which is one-twelfth of 1.25%, of SSGT II’s aggregate asset value, as defined.

The SSGT II Advisor may also be potentially entitled to various subordinated distributions under SSGT II’s operating partnership agreement pursuant to the special limited partnership interest and its cash flow participation distribution rights. So long as the SSGT II Advisory Agreement has not been terminated (including by means of non-renewal), SSGT II is required to pay the SSGT II Advisor a distribution from its operating partnership (other than net sale proceeds), pursuant to a special limited partnership interest, equal to 10.0% of any amount distributed to stockholders in excess of the amount required to provide stockholders with an annual aggregate distribution equal to 5.0% (reflective of the weighted average purchase price per share), cumulative within the subject calendar year (as adjusted for partial periods outstanding). Such distribution will be reconciled and paid annually. The cash flow participation distribution may be payable in cash or operating partnership units (or any combination thereof), at the election of the SSGT II Advisor.

The SSGT II Advisor may also be potentially entitled to various subordinated distributions under SSGT II’s operating partnership agreement if SSGT II (1) lists its shares of common stock on a national exchange, (2) terminates the SSGT II Advisory Agreement, (3) liquidates its portfolio, or (4) merges with another entity or enters into an Extraordinary Transaction, as defined in the SSGT II operating partnership agreement.

The SSGT II Advisory Agreement provides for reimbursement of the SSGT II Advisor’s direct and indirect costs of providing administrative and management services to SSGT II.

Our indirect subsidiaries, Strategic Storage Property Management IV, LLC and SS Growth Property Management II, LLC (collectively the “Managed REITs Property Managers”), are entitled to receive fees for their services in managing the properties owned by the Managed REITs pursuant to property management agreements entered into between the owner of the property and the applicable Managed REIT’s Property Manager. The Managed REIT’s Property Managers will receive a property management fee equal to 6% of the gross revenues from the properties, generally subject to a monthly minimum of $3,000 per property, plus reimbursement of the costs of managing the properties, and a one-time fee of $3,750 for each property acquired that would be managed by the Managed REITs Property Managers. Reimbursable costs and expenses include wages and salaries and other expenses of employees engaged in operating, managing and maintaining such properties. Pursuant to the property management agreements, we through our Operating Partnership employ the on-site staff for the Managed REITs’ properties.

The SST IV property manager will be entitled to a construction management fee equal to 5% of the cost of a related construction or capital improvement work project in excess of $10,000.

Pursuant to the terms of the various agreements described above for the Managed REITs, the following summarizes the related party fees ~~recorded~~ for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019:~~2020:

Reimbursable costs from affiliates includes reimbursement of both the SST IV and SSGT II Advisors’ direct and indirect costs of providing administrative and management services to the Managed REITs. Additionally, reimbursable costs includes reimbursement pursuant to the property management agreements for reimbursement of the costs of managing the Managed REITs’ properties, including wages and salaries and other expenses of employees engaged in operating, managing and maintaining such properties.

As of ~~September~~June 30, ~~2019~~2020, we had receivables due from SST IV and SSGT II totaling approximately ~~$79,000~~$170,000 and ~~$34,000,~~$30,000, respectively, which are included in investments in and advances to the Managed REITs line-item in our consolidated balance sheet. Such amounts included unpaid amounts relative to the above table, in addition to other direct routine expenditures of the Managed REITs that we directly funded.

~~In connection with~~For the ~~Self Administration Transaction, on~~three and six months ended June ~~28, 2019,~~30, 2020, we along with our Operating Partnership, the TRS and SSA (collectively, the “Company Parties”) entered into an Administrative Services Agreement with SAM (the “Administrative Services Agreement”), pursuant to which the Company Parties will be reimbursed for providing certain operational and administrative servicesincurred fees to SAM ~~which may include, without limitation, accounting and financial support, IT support, HR support, advisory services and operations support, and administrative support as set forth in~~under the Administrative Services Agreement and SAM will be reimbursed for providing certain operational and administrative services to the Company Parties which may include, without limitation, due diligence support, marketing, fulfillment and offering support, events support, insurance support, and administrative and facilities support. For the nine months ended September 30, 2019, we have paid SAM administrative service fees of approximately $0.8 million and ~~have received reimbursements~~$1.9 million, respectively, which were recorded in our Managed REIT Platform expenses in our consolidated statement of ~~approximately $0.2 million. For~~operations for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020. We recorded reimbursements from SAM ~~has also paid~~of approximately ~~$50,000~~$0.1 million and $0.3 million, respectively, related to ~~the Company Parties~~services provided to SAM as ~~an allocation~~well as reimbursements of rent and overhead for the portion ~~it occupies~~of the Ladera Office occupied by SAM, which were included in Managed REIT Platform revenue in our consolidated statement of operations for the three and six months ended June 30, 2020, respectively.

As of June 30, 2020, a receivable of approximately $8,000 was due from SAM related to the Administrative Services Agreement and included in the ~~Ladera Office. Such agreement has a term of three years, and is subject to certain adjustments as defined~~other assets line in ~~the agreement.~~our consolidated balance sheet.

We issue ~~stock~~equity based compensation pursuant to the employee and director long-term incentive plan of SmartStop Self Storage REIT, Inc. (the “Plan”). Pursuant to the Plan, we are able to issue various forms of ~~stock~~equity based compensation. ~~To date~~Through June 30, 2020, we have issued equity based awards in two forms: (1) restricted stock awards consisting of shares of our common stock and (2) long-term incentive plan units of our Operating Partnership (“LTIP Units”).

Through April 2020, we had only issued restricted stock, ~~grants,~~ which shares are subject to a time based vesting ~~period over~~period. In April 2020 the Compensation Committee of the Board of Directors approved the 2020 executive compensation program for our executive officers, which included (1) performance based awards, and (2) time based awards. For both such awards the ~~restrictions are released~~recipient could choose either LTIP Units or restricted stock consisting of shares of our common stock.

The fair value of the restricted stock and the ~~stock is issued in book entry form~~LTIP Units was determined based on an estimated value per share, adjusted for an illiquidity discount due to the ~~grantee. During~~illiquid nature of the underlying equity. The fair value of the LTIP Units was further adjusted by applying an additional discount as the LTIP Units are not initially economically equivalent to our restricted stock. For the performance based awards, a fair value was determined for each performance ranking scenario, with stock compensation expense recorded using the fair value of the scenario determined to be probable of achievement.

We have granted various time based awards, which generally vest ratably over either one, three, or four years commencing in the year of grant, subject to the recipient’s continued employment or service through the applicable vesting date. All grants of time based restricted stock have limitations on transferability during the vesting period, ~~the grantee is not permitted to sell, transfer, pledge, encumber or assign shares of non-vested restricted stock granted under the Plan~~ and the grantee does not have the ability to vote any unvested shares. Transferability during the ~~shares. Any dividends accrued~~vesting period depends upon when the grant was made, as follows (i) with respect to grants of time based restricted stock made prior to April 2020, the restriction on transfers applies to the entirety of the grant, regardless of vesting, and (ii) with respect to grants of time based restricted stock made in or subsequent to April 2020, the restriction on transfer applies only to the unvested portion of the restricted stock.

With respect to grants of time based restricted stock made to our executive officers in 2020, distributions began to accrue effective January 1, 2020 and are payable as distributions are paid on our Class A Shares without regard to whether the underlying restricted shares have vested. With respect to all other outstanding grants of time based restricted stock, distributions accrue on non-vested shares ~~will be~~granted and are paid ~~if and~~ when the underlying restricted shares vest. ~~Generally~~

Holders of time based LTIP Units receive allocations of profits and losses with respect to the ~~shares vest over~~LTIP Units as of the effective date, distributions from the effective date in an ~~approximate four-year period which begins~~amount equivalent to the distributions declared and paid on our Class A Shares, and the ~~date~~same voting rights as holders of ~~grant.~~common units, voting as a class with each LTIP Unit holder having one vote per LTIP Unit held. Prior to vesting, time based LTIP Units generally may not be transferred, other than by laws of descent and distribution.

~~As of September 30, 2019, 5,625,628 shares were available for issuance under~~The following table summarizes the ~~Plan.~~activity related to our time based awards:

With respect to performance based awards, the number of shares of restricted stock granted as of the grant date equaled 100% of the targeted award, whereas the number of LTIP Units granted as of the grant date equaled 200% of the targeted award. The targeted award for each executive was determined and approved by the Compensation Committee of our Board of Directors. The actual number of shares of restricted stock or LTIP Units, as applicable, to be issued upon vesting may range from 0% to 200% of the targeted award, such determination being based upon the results of the performance measure. Performance based awards vest based upon our performance as ranked amongst a peer group of self storage related companies. This comparison will be conducted using a performance measure of average annual same-store revenue growth, analyzed over a three-year period. Earned awards for the 2020 grant will vest, as applicable, no later than March 31, 2023.

Recipients of performance based restricted stock accrue distributions during the performance period, and such distributions will only be payable on the date that any such shares of restricted stock vest, based upon the performance level attained. Recipients of performance based LTIP Units are issued LTIP Units at 200% of the targeted award and are entitled to receive distributions and allocations of profits and losses with respect to the performance based LTIP Units as of the effective date of January 1, 2020 in an amount equal to 10% of the distributions and allocations available to such LTIP Units, until the Distribution Participation Date (as defined in the Partnership Agreement). The remaining 90% of distributions will accrue and will be payable on the Distribution Participation Date based upon the performance level attained and number of performance based LTIP Units that vest. Following the Distribution Participation Date, recipients will be entitled to receive the full amount of distributions and allocations of profits and losses with respect to the vested performance-based LTIP Units, such amount being equivalent to distributions declared and paid on our Class A Shares.

The following table summarizes our activity related to our performance based awards:

Holders of performance based restricted stock do not have any rights as a stockholder with respect to the unvested portion of such restricted stock awards. Prior to vesting, shares of performance based restricted stock generally may not be transferred, other than by laws of descent and distribution.

Holders of performance based LTIP Units have the same voting rights as holders of common units, voting as a class with each LTIP Unit holder having one vote per LTIP Unit held. Prior to vesting, performance based LTIP Units generally may not be transferred, other than by laws of descent and distribution.

LTIP Units are designed to qualify as “profits interests” in the Operating Partnership for federal income tax purposes. The profits interests’ characteristics of the LTIP Units mean that initially they will not be treated as economically equivalent in value to a common unit and the issuance of LTIP Units will not be a taxable event to the Operating Partnership or the recipient. If and when certain events occur pursuant to applicable tax regulations and in accordance with the Partnership Agreement, LTIP Units may increase in value over time and become equivalent to common units of limited partnership interest of our Operating Partnership on a one-for-one basis.

As of June 30, 2020, 5,637,012 shares of stock were available for issuance under the Plan.

We recorded approximately ~~$161,000~~$0.4 million and ~~$208,000~~$0.6 million of equity based compensation expense, primarily in general and administrative expense and to a lesser extent, in property operating expenses, within our consolidated statements of operations ~~related to restricted stock granted to employees and directors~~ for the three and ~~nine~~six months ended ~~September~~June 30, ~~2019,~~2020, respectively. As of ~~September~~June 30, ~~2019,~~2020, there was approximately ~~$2.5~~$4.8 million of total unrecognized compensation expense related to non-vested ~~restricted stock~~equity awards. Such cost is expected to be recognized over a weighted-average period of ~~3.9~~approximately 2.9 years.

We have adopted an amended and restated distribution reinvestment plan that allows both our Class A and Class T stockholders to have distributions otherwise distributable to them invested in additional shares of our Class A and Class T Shares, respectively. The purchase price per share pursuant to our distribution reinvestment plan is equivalent to the estimated value per share approved by our board of directors and in effect on the date of purchase of shares under the plan. In conjunction with the board of directors’ declaration of a new estimated value per share of our common stock on ~~June 26, 2019,~~April 20, 2020, beginning in ~~July 2019,~~May 2020, shares sold pursuant to our distribution reinvestment plan are sold at the estimated value per share of ~~$10.66~~$10.40 per Class A Share and Class T Share. On November 30, 2016, we filed with the SEC a Registration Statement on Form S-3, which registered up to an additional $100.9 million in shares under our distribution reinvestment plan (our “DRP Offering”). We may amend or terminate the amended and restated distribution reinvestment plan for any reason at any time upon 10 days’ prior written notice to stockholders. NaN sales commissions, dealer manager fee, or stockholder servicing fee will be paid on shares sold through the amended and restated distribution reinvestment plan. Through the termination of our Offering on January 9, 2017, we had sold approximately 1.1 million Class A shares and 0.1 million Class T Shares through our original distribution reinvestment plan. As of ~~September~~June 30, ~~2019,~~2020, we had sold approximately ~~3.7~~4.7 million Class A Shares and approximately ~~0.6~~0.7 million Class T Shares through our DRP Offering.

We previously adopted a share redemption program that ~~enables~~enabled stockholders to sell their shares to us in limited circumstances. On August 26, 2019, our board of directors approved the suspension of our share redemption ~~plan~~program effective as of September 27, 2019, except with respect to redemption requests made in connection with the death or disability of a stockholder, redemption due to confinement to a long-term care facility, or other exigent circumstances. WeOn March 30, 2020, our board of directors approved the complete suspension of our share redemption program, effective on April 29, 2020. If the suspension is lifted, we may redeem the shares of stock presented for redemption for cash to the extent that such requests comply with the ~~foregoing~~below terms of our share redemption program and we have sufficient funds available to fund such redemption. We are not obligated to redeem shares under the share redemption program.

Our board of directors may amend, suspend or terminate the share redemption program with 30 days’ notice to our stockholders. We may provide this notice by including such information in a Current Report on Form 8-K or in our annual or quarterly reports, all publicly filed with the SEC, or by a separate mailing to our stockholders. ~~The complete terms of our share redemption program are described in our prospectus, and updated on Form 8-K filed with the SEC on August 28, 2019.~~

The amount that we may pay to redeem stock for redemptions is the redemption price set forth in the following table which is based upon the number of years the stock is held:

AtExcluding any period while the program is suspended, any time we are engaged in an offering of shares, the Redemption Amount for shares purchased under our share redemption program will always be equal to or lower than the applicable per share offering price. As long as we are engaged in an offering, the Redemption Amount shall be the lesser of the amount the stockholder paid for their shares or the price per share in the current offering. If we are no longer engaged in an offering, our board of directors will announce any redemption price adjustment and the time period of its effectiveness as a part of its regular communications with our stockholders. At any time the redemption price during an offering is determined by any method other than the offering price, if we have sold property and have made one or more special distributions to our stockholders of all or a portion of the net proceeds from such sales, the per share redemption price will be reduced by the net sale proceeds per share distributed to investors prior to the redemption date as a result of the sale of such property in the special distribution. Our board of directors will, in its sole discretion, determine which distributions, if any, constitute a special distribution. While our board of directors does not have specific criteria for determining a special distribution, we expect that a special distribution will only occur upon the sale of a property and the subsequent distribution of the net sale proceeds.

There are several limitations in addition to those noted above on our ability to redeem shares under the share redemption program including, but not limited to:

For the year ended December 31, ~~2018,~~2019, we received redemption requests totaling approximately ~~$8.3~~$4.9 million (approximately ~~0.9~~0.5 million shares), approximately ~~$7.0~~$4.5 million of which were fulfilled during the year ended December 31, ~~2018,~~2019, with the remaining approximately ~~$1.3~~$0.4 million included in accounts payable and accrued liabilities as of December 31, ~~2018~~2019 and fulfilled in January ~~2019. For~~2020. During the ~~nine~~six months ended ~~September~~June 30, ~~2019, we received~~2020, approximately 0.1 million shares, or $1.3 million, were requested to be redeemed; however, due to the complete suspension of our share redemption program, 0 share redemption requests ~~totaling approximately $4.4 million (approximately 450,000 shares), $4.0 million of which~~ were ~~fulfilled in April and July 2019, and approximately $0.4 million of which were included in accounts payable and accrued liabilities as of September 30, 2019, and fulfilled in October 2019.~~fulfilled.

Generally, the limited partners of our Operating Partnership, excluding any limited partners with respect to their A-2 Units, have the right to cause our Operating Partnership to redeem their limited partnership units for cash equal to the value of an equivalent number of our shares, or, at our option, we may purchase their limited partnership units by issuing 1 share of our common stock for each limited partnership unit redeemed. These rights may not be exercised under certain circumstances that could cause us to lose our REIT election. Furthermore, limited partners may exercise their redemption rights only after their limited partnership units have been outstanding for one year.

Additionally, the Class A-1 Units issued in connection with the Self Administration Transaction are subject to the general restrictions on transfer contained in the Operating Partnership Agreement. In addition, until the Lock-Up Expiration, the Class A-1 Units may not be sold, pledged, or otherwise transferred or encumbered except in certain limited circumstances set forth in the Contribution Agreement. The Class A-1 Units are otherwise entitled to all rights and duties of the Class A

limited partnership units in the Operating Partnership, including cash distributions and the allocation of any profits or losses in the Operating Partnership.

From time to time, we are party to legal proceedings that arise in the ordinary course of our business. We are not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on our results of operations or financial condition, nor are we aware of any such legal proceedings contemplated by governmental authorities.

On ~~September 20, 2019,~~March 30, 2020, our board of directors ~~declared~~changed its distribution authorizations from a quarterly to monthly authorization starting with the second quarter of 2020. This change in the distribution policy was in order to give our board maximum flexibility to monitor and evaluate the situation related to the financial impact of COVID-19. In connection with this, for the months of April, May, June, and July 2020, our board of directors authorized a daily distribution rate ~~for the fourth quarter of 2019~~ of approximately ~~$0.001644~~$0.00164 per day per share on the outstanding shares of common stock payable to ~~both~~ Class A and Class T stockholders of record of such shares as shown on our books at the close of business on each day ~~during~~of the ~~period, commencing on October 1, 2019 and continuing on each day thereafter through and including December 31, 2019. In connection with this distribution, after~~period. After the stockholder servicing fee is paid, approximately $0.0014 per day will be paid per Class T share. Such distributions payable to each stockholder of record during a month will be paid the following month.

The following is a summary of quarterly financial information for the periods shown below:

AsOn July 22, 2020, our board of ~~November 12, 2019, we have issued~~directors declared a distribution rate for August 2020 of approximately ~~3.8 million~~$0.00164 per day per share on the outstanding shares of common stock payable to both Class A ~~shares of our common stock~~ and ~~approximately 0.6 million~~ Class T ~~Shares~~stockholders of record of such shares as shown on our ~~common stock for gross proceeds~~books at the close of ~~approximately $39.4 million~~business on each day during the period, commencing on August 1, 2020, and ~~approximately $6.0 million, pursuant to our DRP Offering.~~

~~The San Antonio II Property was acquired by us in the SSGT Mergers. On February 5, 2019, we executed a purchase~~continuing on each day thereafter through and sale agreement with an unaffiliated third party for the sale of the self storage facility and industrial warehouse/office space we own in San Antonio, Texas (the “San Antonio II Property”). On October 18, 2019, we completed the sale of the San Antonio II Property for approximately $16.1 million, less closing costs.including August 31, 2020. In connection with this distribution, after the ~~sale~~stockholder servicing fee is paid, approximately $0.0014 per day will be paid per Class T share. Such distributions payable to each stockholder of record during a month will be paid the ~~San Antonio II Property, which was encumbered by the Secured Loan, we paid off approximately $9.9 million on the Secured Loan, and approximately $5.4 million on the Senior Term Loan.~~following month.

~~Series A Preferred Stock Purchase Agreement~~Land Acquisition – Riverview, Florida

On ~~October 29, 2019 (the “Commitment Date”),~~July 21, 2020, we ~~entered into a preferred stock purchase agreement (the “Purchase Agreement”) with Extra Space Storage LP (the “Investor”), a subsidiary~~purchased an undeveloped parcel of ~~Extra Space Storage Inc. (NYSE: EXR), pursuant~~land adjacent to ~~which~~our existing Riverview, Florida self storage facility for $800,000, plus closing costs. We acquired the ~~Investor committed to purchase up to $200 million in shares (the aggregate shares~~parcel from an unaffiliated third party and intend on expanding our existing self storage facility on the newly acquired land; thereby adding approximately 170 units and approximately 25,000 rentable square feet. We expect development to be purchased, the “Shares”) of our new Series A Convertible Preferred Stock (the “Series A Preferred Stock”), in one or more closings (each, a “Closing,” and collectively, the “Closings”). The initial closing (the “Initial Closing”)completed in the ~~amount~~second or third quarter of $150 million occurred on the Commitment Date. The Investor has committed to purchase up to an additional $50 million, at our option, within 12 months following the Initial Closing, subject to certain limitations. We will pay the Investor a fee of 0.25% per annum on the remaining commitment amount until drawn, or the 12-month anniversary of the Initial Closing.

~~In connection with the Initial Closing, we filed articles supplementary to our Second Articles of Amendment and Restatement, which~~2021.classified and designated 200,000 authorized but unissued shares of Preferred Stock as the Series A Preferred Stock. The shares of Series A Preferred Stock rank senior to all other shares our capital stock, including our common stock, with respect to rights to receive dividends and to participate in distributions or payments upon any voluntary or involuntary liquidation, dissolution or winding up of the Company. Dividends payable on each share of Series A Preferred Stock will initially be equal to a rate of 6.25% per annum. If the Series A Preferred Stock has not been redeemed on or prior to the fifth anniversary date of the Initial Closing, the dividend rate will increase an additional 0.75% per annum each year thereafter to a maximum of 9.0% per annum until the tenth anniversary of the Initial Closing, at which time the dividend rate shall increase 0.75% per annum each year thereafter until the Series A Preferred Stock is redeemed or repurchased in full.

Upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of Series A Preferred Stock will be entitled to receive a payment equal to the greater of (i) aggregate purchase price of all outstanding Shares, plus any accrued and unpaid dividends (the “Liquidation Amount”) and (ii) the amount that that would have been payable had the Shares been converted into common stock pursuant to the terms of the Purchase Agreement immediately prior to such liquidation.

Subject to certain additional redemption rights, as described herein, we have the right to redeem the Series A Preferred Stock for cash at any time following the fifth anniversary of the Initial Closing. The amount of such redemption will be equal to the Liquidation Amount. Upon the listing of common stock on a national securities exchange (the “Listing”), we have the right to redeem any or all outstanding Series A Preferred Stock at an amount equal to the greater of (i) the amount that would have been payable had such Shares been converted into common stock pursuant to the terms of the Purchase Agreement immediately prior to the Listing, and then all of such Shares were sold in the Listing, or (ii) the Liquidation Amount, plus a premium amount (the “Premium Amount”) of 10%, 8%, 6%, 4%, or 2% if redeemed prior to the first, second, third, fourth, or fifth anniversary dates of issuance, respectively, or 0% if redeemed thereafter, as set forth in the Articles Supplementary. Upon a change of control event, we have the right to redeem any or all outstanding Series A Preferred Stock at an amount equal to the greater of (i) the amount that would have been payable had the Shares been converted into common stock pursuant to the terms of the Purchase Agreement immediately prior to such change of control or (ii) the Liquidation Amount, plus the Premium Amount, as set forth in the Articles Supplementary. In addition, subject to certain cure provisions, if we fail to maintain our status as a real estate investment trust, the holders of Series A Preferred Stock have the right to require us to repurchase the Series A Preferred Stock at an amount equal to the Liquidation Amount.

At any time after the earlier to occur of (i) the second anniversary of the Initial Closing or (ii) 180 days after a Listing, the holders of Series A Preferred Stock have the right to convert any or all of the Series A Preferred Stock held by such holders into common stock at a rate per share equal to the quotient obtained by dividing the Liquidation Amount by the conversion price. The conversion price is $10.66, as may be adjusted in connection with stock splits, stock dividends and other similar transactions.

The holders of Series A Preferred Stock are not entitled to vote on any matter submitted to a vote of our stockholders, except that in the event that the dividend for the Series A Preferred Stock has not been paid for at least four quarters (whether or not consecutive), the holders of Series A Preferred Stock have the right to vote together with our stockholders on any matter submitted to a vote of our stockholders, upon which the holders of the Series A Preferred Stock and holders of common stock shall vote together as a single class. The number of votes applicable to a share of Series A Preferred Stock will be equal to the number of shares of common stock a share of Series A Preferred Stock could have been converted into as of the record date set for purposes of such stockholder vote. This foregoing limited voting right shall cease when all past dividend periods have been paid in full. In addition, the affirmative vote of the holders of a majority of the outstanding shares of Series A Preferred Stock is required in certain customary circumstances, as well as other circumstances, such as (i) our real estate portfolio exceeding a leverage ratio of 60% loan-to-value, (ii) entering into certain transactions with our Executive Chairman as of the Commitment Date, or his affiliates, (iii) effecting a merger (or similar) transaction with an entity whose assets are not at least 80% self storage related and (iv) entering into any line of business other than self storage and ancillary businesses, unless such ancillary business represents revenues of less than 10% of our revenues for our last fiscal year.

~~We used the proceeds from the Initial Closing to pay off approximately $95.4 million in debt, consisting of the then outstanding balance on the Senior Term Loan and the~~ ~~KeyBank Tenant Program Loan, which had balances of approximately $80.9 million and $14.5 million, respectively, as of the Commitment Date.~~ ~~In connection with the pay off of the Senior Term Loan, we terminated approximately $75.7 million of an interest rate swap which required a settlement payment of approximately $0.6 million.~~

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our financial statements and notes thereto contained elsewhere in this report. The following Management’s Discussion and Analysis of Financial Condition and Results of Operations should also be read in conjunction with our financial statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019. See also “Cautionary Note Regarding Forward-Looking Statements” preceding Part I.

SmartStop Self Storage REIT, Inc. ~~(f/k/a Strategic Storage Trust II, Inc.)~~, a Maryland corporation (the “Company”), is a self-managed and fully-integrated self storage real estate investment trust (“REIT”), formed on January 8, 2013 under the Maryland General Corporation Law. Our year-end is December 31. As used in this report, “we,” “us,” “our,” and “Company” refer to SmartStop Self Storage REIT, Inc. and each of our subsidiaries.

On June 28, 2019, we and our operating partnership, SmartStop OP, L.P. ~~(f/k/a Strategic Storage Operating Partnership II, L.P.)~~ (our “Operating Partnership”), and SmartStop TRS, Inc. ~~(f/k/a Strategic Storage TRS II, Inc.)~~ (the “TRS”) entered into a series of transactions, agreements, and amendments to our existing agreements and arrangements (such agreements and amendments hereinafter referred to collectively as the “Self Administration Transaction”), with SmartStop Asset Management, LLC, our former sponsor (“SAM”) and SmartStop OP Holdings, LLC (“SS OP Holdings”), a subsidiary of SAM, pursuant to which, effective June 28, 2019, we acquired the self storage advisory, asset management and property management businesses and ~~Tenant Programs (as defined in Note 9 of the Notes to the Consolidated Financial Statements contained in this report)~~certain joint venture interests of SAM (the “Self Storage Platform”), along with certain other assets of SAM. As a result of the Self Administration Transaction, SAM is no longer our sponsor, and the special limited partnership interest and limited partnership interest it held in our Operating Partnership through our Former External Advisor have been redeemed. ~~Additionally, we~~We are now self-managed and succeed to the advisory, asset management and property management businesses and ~~Tenant Programs~~certain joint ventures previously in place for us, Strategic Storage Trust IV, Inc. (“SST IV”), a public non-traded REIT, and Strategic Storage Growth Trust II, Inc. (“SSGT II”) (collectively with SST IV the “Managed REITs”), a private non-traded ~~REIT, and now~~REIT. In addition, as a sponsor to the Managed REITs, we now have the internal capability to originate, structure and manage additional investment products (the “Managed REIT Platform”) which would be sponsored by SmartStop REIT Advisors, LLC (“SRA”), our indirect subsidiary. As a result of the Self Administration Transaction, we indirectly own 100% of the membership interests in Strategic Storage Advisor II, LLC (our “Former External Advisor”) and each of Strategic Storage Property Management II, LLC and SS Growth Property Management, LLC (together, our “Former External Property Managers”). See Note 4 of the Notes to the Consolidated Financial Statements contained in this report for additional information.

On October 1, 2018, we, our Operating Partnership, and SST II Growth Acquisition, LLC, our wholly-owned subsidiary (“Merger Sub”), entered into an Agreement and Plan of Merger (the “SSGT Merger Agreement”) with Strategic Storage Growth Trust, Inc. (“SSGT”), a non-traded REIT sponsored by our former sponsor, and SS Growth Operating Partnership, L.P. (“SSGT OP”). Pursuant to the terms and conditions set forth in the Merger Agreement, on January 24, 2019: (i) we acquired SSGT by way of a merger of SSGT with and into Merger Sub, with Merger Sub being the surviving entity (the “SSGT REIT Merger”); and (ii) immediately after the SSGT REIT Merger, SSGT OP merged with and into our Operating Partnership, with the Operating Partnership continuing as the surviving entity and remaining a subsidiary of the Company (the “SSGT Partnership Merger” and, together with the SSGT REIT Merger, the “SSGT Mergers”). SSGT was focused on opportunistic self storage properties, including development and lease-up properties. See Note 3, Real Estate Facilities—Merger with Strategic Storage Growth Trust, Inc., for additional information related to the SSGT Mergers.

OnIn our initial public offering, which commenced on January 10, 2014, and ended on January 9, 2017, we ~~commenced a public offering of~~offered a maximum of $1.0 billion in common shares for sale to the public (the “Primary Offering”) and $95.0 million in common shares for sale pursuant to our distribution reinvestment plan (collectively, the “Offering”)~~. On May 23, 2014, we satisfied the $1.5 million minimum offering requirements of our Offering~~ and commenced formal operations. On September 28, 2015, we revised our Offering and offered two classes of shares of common stock: Class A common stock, $0.001 par value per share (the “Class A Shares”) and Class T common stock, $0.001 par value per share (the “Class T Shares”). Our Offering terminated on January 9, 2017. We sold approximately 4848.4 million Class A Shares and approximately 7 million Class T Shares in our Offering for gross proceeds of approximately $493 million and approximately $73 million, respectively. On November 30, 2016, prior to the termination of our Offering, we filed with the SEC a Registration Statement on Form S-3, which registered up to an additional $100.9 million in shares under our distribution reinvestment plan (our “DRP Offering”). The DRP Offering may be terminated at any time upon 10 days’ prior written notice to stockholders. As of September 30, 2019, we had sold approximately 3.7 million Class A Shares and approximately 0.67.3 million Class T Shares for approximately ~~$38.3~~$493 million and ~~$5.8~~$73 million, ~~respectively, in our DRP Offering.~~respectively.

As of ~~September~~June 30, ~~2019,~~2020, we owned 112 operating self storage facilities ~~and one facility under development~~ located in 17 states (Alabama, Arizona, California, Colorado, Florida, Illinois, Indiana, Maryland, Massachusetts, Michigan, New Jersey, Nevada, North Carolina, Ohio, South Carolina, Texas and Washington) and Ontario, Canada (the Greater Toronto Area).

As of ~~September~~June 30, ~~2019,~~2020, our self storage portfolio was comprised as follows:

State	No. of Properties		Units⁽¹⁾		Sq. Ft. (net)⁽²⁾		% of Total Rentable Sq. Ft.			Physical Occupancy %⁽³⁾			Rental Income %⁽⁴⁾			No. of Properties		Units⁽¹⁾		Sq. Ft. (net)⁽²⁾		% of Total Rentable Sq. Ft.			Physical Occupancy %⁽³⁾			Rental Income %⁽⁴⁾
Alabama		1		1,080		159,000		1.9	%		86.1	%		1.1	%		1		1,080		159,000		2.0	%		88.1	%		1.0	%
Arizona		2		1,815		190,700		2.3	%		52.3	%		1.2	%		2		1,815		190,700		2.3	%		76.8	%		1.6	%
California		24		15,230		1,588,000		19.1	%		87.6	%		23.2	%		24		15,230		1,588,000		19.6	%		90.7	%		21.6	%
Colorado		6		3,190		348,500		4.2	%		87.4	%		3.8	%		6		3,190		348,500		4.3	%		87.9	%		4.1	%
Florida		17		13,260		1,512,300		18.2	%		87.1	%		20.8	%		17		13,260		1,512,300		18.4	%		89.7	%		22.6	%
Illinois		5		2,920		305,800		3.7	%		91.9	%		2.9	%		5		2,920		305,800		3.9	%		88.2	%		3.3	%
Indiana		2		1,000		112,100		1.3	%		90.7	%		0.9	%		2		1,000		112,100		1.4	%		91.5	%		0.9	%
Massachusetts		1		840		93,000		1.1	%		83.3	%		2.5	%		1		840		93,000		1.1	%		85.9	%		2.4	%
Maryland		2		1,610		172,900		2.1	%		85.4	%		2.3	%		2		1,610		172,900		2.1	%		91.3	%		2.7	%
Michigan		4		2,180		261,000		3.1	%		91.0	%		2.8	%		4		2,180		261,000		3.2	%		89.3	%		2.6	%
New Jersey		1		460		51,000		0.6	%		89.9	%		0.6	%		1		460		51,000		0.6	%		94.5	%		0.7	%
Nevada		6		5,040		623,500		7.5	%		87.1	%		6.7	%		6		5,040		623,500		7.6	%		92.5	%		6.7	%
North Carolina		17		7,230		1,019,300		12.2	%		86.4	%		9.3	%		17		7,230		1,019,300		12.4	%		89.9	%		9.3	%
Ohio		5		2,210		272,300		3.3	%		89.5	%		2.2	%		5		2,210		272,300		3.4	%		94.7	%		2.3	%
South Carolina		3		1,920		242,600		2.9	%		81.1	%		2.4	%		3		1,920		242,600		3.0	%		88.8	%		2.4	%
Texas		4		2,130		314,200		3.8	%		85.6	%		3.4	%		3		1,690		230,800		2.8	%		90.7	%		2.5	%
Washington		1		490		48,100		0.6	%		84.8	%		0.7	%		1		490		48,100		0.6	%		85.5	%		0.5	%
Ontario, Canada⁽⁵⁾		12		9,540		1,006,700		12.1	%		89.2	%		13.2	%		12		9,540		1,006,700		11.3	%		87.5	%		12.8	%
Total		113		72,145		8,321,000		100	%		86.7	%		100	%		112		71,705		8,237,600		100	%		89.6	%		100	%

We have established accounting policies which conform to generally accepted accounting principles (“GAAP”). Preparing financial statements in conformity with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. Following is a discussion of the estimates and assumptions used in setting accounting policies that we consider critical in the presentation of our financial statements. Many estimates and assumptions involved in the application of GAAP may have a material impact on our financial condition or operating performance, or on the comparability of such information to amounts reported for other periods, because of the subjectivity and judgment required to account for highly uncertain items or the susceptibility of such items to change. These estimates and assumptions affect our reported amounts of assets and liabilities, our disclosure of contingent assets and liabilities at the dates of the financial statements and our reported amounts of revenue and expenses during the period covered by this report. If management’s judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible that different accounting policies would have been applied or different amounts of assets, liabilities, revenues and expenses would have been recorded, thus resulting in a materially different presentation of the financial statements or materially different amounts being reported in the financial statements. Additionally, other companies may use different estimates and assumptions that may impact the comparability of our financial condition and results of operations to
those companies.

We believe that our critical accounting policies include the following: real estate purchase price allocations; the evaluation of whether any of our long-lived assets have been impaired; the valuation of goodwill and related impairment considerations, the valuation of our trademarks and related impairment considerations, the determination of the useful lives of our long-lived assets; and the evaluation of the consolidation of our interests in joint ventures. The following discussion of these policies supplements, but does not supplant the description of our significant accounting policies, as contained in Note 2 of the Notes to the Consolidated Financial Statements contained in this report, and is intended to present our analysis of the uncertainties involved in arriving upon and applying each policy.

The value of the tangible assets, consisting of land and buildings is determined as if vacant. Because we believe that substantially all of the leases in place at properties we will acquire will be at market rates, as the majority of the leases are month-to-month contracts, we do not expect to allocate any portion of the purchase prices to above or below market leases. We also consider whether in-place, market leases represent an intangible asset. Acquisitions of portfolios of facilities are allocated to the individual facilities based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates which take into account the relative size, age, and location of the individual facility along with current and projected occupancy and rental rate levels or appraised values, if available.

Our allocations of purchase prices are based on certain significant estimates and assumptions, variations in such estimates and assumptions could result in a materially different presentation of the consolidated financial statements or materially different amounts being reported in the consolidated financial statements.

~~The majority of our assets consist of long-lived real estate assets as well as intangible assets related to our acquisitions.~~ We evaluate ~~such~~our real property assets for impairment based on events and changes in circumstances that may arise in the future and that may impact the carrying amounts of ~~our long-lived~~such assets. When indicators of potential impairment are present, we will assess the recoverability of the particular asset by determining whether the carrying value of the asset will be recovered, through an evaluation of the undiscounted future operating cash flows expected from the use of the asset and its eventual disposition. This evaluation is based on a number of estimates and assumptions. Based on this evaluation, if the expected undiscounted future cash flows do not exceed the carrying value, we will adjust the value of the ~~long-lived~~real property asset and recognize an impairment loss. Our evaluation of the impairment of ~~long-lived~~real property assets could result in a materially different presentation of the financial statements or materially different amounts being reported in the financial statements, as the amount of impairment loss, if any, recognized may vary based on the estimates and assumptions we use.

In connection with the Self Administration Transaction, we allocated a portion of the consideration to the contracts that we acquired related to the Managed REITs and the customer relationships related to the Tenant Programs joint ventures. For these intangibles, we are amortizing such amounts on a straight-line basis over the estimated benefit period of the contracts and customer relationships. We evaluate these intangible assets for impairment when an event occurs or circumstances change that indicate the carrying value may not be recoverable. In such an event, an impairment charge is recognized and the intangible asset is marked down to its fair value.

See Note 5 of the consolidated financial statements contained within this report for additional information.

Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible assets and other intangible assets acquired. Goodwill is allocated to various reporting units, as applicable, and is not amortized. We ~~will~~ perform an annual impairment test for goodwill and between annual tests, we ~~will~~ evaluate the recoverability of goodwill whenever events or changes in circumstances indicate that the carrying amount of goodwill may not be fully recoverable. In our impairment ~~tests~~test of goodwill, we ~~will first assess qualitative factors~~perform a quantitative analysis to ~~determine whether it is more likely than not that~~compare the fair value of aeach reporting unit ~~is less than~~to its respective carrying amount. If based on this assessment, management determines that the fair value of the reporting unit is not less than its carrying amount, then performing the additional two-step impairment test is unnecessary. If the carrying amount of goodwill exceeds its fair value, an impairment charge will be recognized.

See Note 5 of the consolidated financial statements contained within this report for additional information.

Trademarks are based on the value of our brands. Trademarks are valued using the relief from royalty method, which presumes that without ownership of such trademarks, we would have to make a stream of payments to a brand or franchise owner in return for the right to use their name. By virtue of this asset, we avoid any such payments and record the related intangible value of our ownership of the brand name. We used the following significant projections and assumptions to determine value under the relief from royalty method: revenues; royalty rate; tax expense; terminal growth rate; and discount rate. For the SmartStop^® trademark, the projections underlying this relief from royalty model were forecasted for eight years and then a terminal value calculation was applied. For the Strategic Storage^® trademark, the projections underlying the relief from royalty model were forecasted for seven years. Applying the selected pretax royalty rates to the applicable revenue base in each period yielded pretax income for each of our trademarks. These pretax totals were tax effected utilizing the applicable tax rate to arrive at net, after-tax cash flows. The net, after-tax flows were then discounted to present value utilizing an appropriate discount rate. The present value of the after-tax cash flows were then added to the present value of the amortization tax benefit (considering the 15-year amortization of intangible assets pursuant to U.S. tax legislation) to arrive at the ~~recommended~~estimated fair values for the trademarks.

We ~~will~~ evaluate whether any triggering events or changes in circumstances have occurred subsequent to our annual impairment test that would indicate an impairment condition may exist. If any change in circumstance or triggering event occurs, and results in a significant impact to our revenue and profitability projections, or any significant assumption in our valuations methods is adversely impacted, the impact could result in a material impairment charge in the future.

See Note 5 of the consolidated financial statements contained within this report for additional information.

We assess the useful lives of the assets underlying our properties based upon a subjective determination of the period of future benefit for each asset. We record depreciation expense with respect to these assets based upon the estimated useful lives we determine. Our determinations of the useful lives of the assets could result in a materially different presentation of the financial statements or materially different amounts being reported in the financial statements, as such determinations, and the corresponding amount of depreciation expense, may vary dramatically based on the estimates and assumptions we use.

We evaluate the consolidation of our investments in joint ventures in accordance with relevant accounting guidance. This evaluation requires us to determine whether we have a controlling interest in a joint venture through a means other than voting rights, and, if so, such joint venture may be required to be consolidated in our financial statements. Our evaluation of our joint ventures under such accounting guidance could result in a materially different presentation of the financial statements or materially different amounts being reported in the financial statements, as the joint venture entities included in our financial statements may vary based on the estimates and assumptions we use.

We made an election under Section 856(c) of the Internal Revenue Code of 1986 (the Code) to be taxed as a REIT under the Code, commencing with the taxable year ended December 31, 2014. By qualifying as a REIT for federal income tax purposes, we generally will not be subject to federal income tax on income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year in which our qualification is denied. Such an event could materially and adversely affect our net income

and could have a material adverse impact on our financial condition and results of operations. However, we believe that we are organized and operate in a manner that will enable us to continue to qualify for treatment as a REIT for federal income tax purposes, and we intend to continue to operate as to remain qualified as a REIT for federal income tax purposes.

Our rental revenue and operating results depend significantly on the demand for self storage space. Since the beginning of the COVID-19 pandemic in March 2020, national and local governments in every jurisdiction in which we operate have, at various times, issued orders causing temporary shutdowns of businesses and restrictions on the ability of residents to conduct business or engage in certain activities outside of their homes, as well as restrictions on certain commercial activities. These orders have impacted, and could continue to impact, our facilities and operations. Beginning in late March, we saw reductions in our move-in volumes which were partially offset by lower move-out volumes. While rental activity recovered to more typical seasonally adjusted levels in May and June, any future periods of extended stay-at-home orders or other temporary shutdowns could cause a reduction in our rental activity.

In addition, we have instituted the use of masks, plastic dividers, additional cleaning measures and social distancing at all of our self storage facilities, as well as instituted remote working measures at our corporate headquarters and call center. We have also adjusted our in-store operations in order to comply with the various governmental orders, and, in certain cases, we had to temporarily close some of our offices.

To date there has been no significant change in our rent collections. However, rent collections could be impacted by prolonged economic stress and unemployment, which could affect our customers’ ability to pay rent and thus would increase bad debt expense. While we have recently implemented a contactless option for servicing our customers, we typically conduct aspects of our leasing activities at our facilities, as well as the offering of various ancillary products, including moving and packing supplies, such as locks and boxes, and other services, such as tenant protection plans. Reductions in the ability and willingness of customers to visit our facilities due to the COVID-19 outbreak along with the economic impact of COVID-19 on customers could reduce rental revenue and ancillary operating revenue produced by our facilities. Concerns relating to COVID-19 have also affected, and could continue to affect, our on-site staffing, which could have an adverse impact our ability to adequately manage our facilities.

Various jurisdictions have issued orders or proclamations impacting our ability to charge certain fees, conduct auctions or increase our rental rates. Beginning in mid-March, we elected to suspend all auctions and rate increases for our existing customers, as well as suspend or waive certain fees. Furthermore, reduced rental activity during late March and April, as well as lower prices offered by competitors, caused lower rental rates for incoming customers during the second quarter. As a result, we have generally seen a negative impact on our revenues beginning primarily in April 2020. Additionally, we have seen increases in our property operating expenses caused by the cost of increased safety precautions, including personal protective equipment, increased cleaning and specialized sanitizing procedures, and one-time cash bonuses for our store and field personnel. Beginning June 2020, in certain jurisdictions, we resumed certain normal operating procedures on a modified basis, including auctions and charging late fees.

Below is a summary of various business metrics and indicators impacted by the COVID-19 pandemic which impacted our self storage revenues during second quarter 2020:

The ultimate extent and duration of the impact of the COVID-19 outbreak, including the corresponding governmental orders, on the demand for self storage space or on our business, financial condition, collections, bad debt expense, liquidity, results of operations and prospects will depend on future developments, which are highly uncertain and cannot be predicted. This includes new information that may also emerge concerning the breadth or severity of the COVID-19 outbreak, as well as the actions to contain or treat its impact.

We derive revenues principally from: (i) rents received from our self storage tenant leases; (ii) fees generated from our Managed REITs; (iii) our Tenant Programs; and (iv) sales of packing- and storage-related supplies at our storage facilities. Therefore, our operating results depend significantly on our ability to retain our existing tenants and lease our available self storage units to new tenants, while maintaining and, where possible, increasing the prices for our self storage units. Additionally, our operating results depend on our tenants making their required rental payments to us, maintaining ~~and increasing~~our fees from our Managed REITs, and the success of our Tenant Programs.

Competition in the market areas in which we operate is significant and affects the occupancy levels, rental rates, rental revenues and operating expenses of our facilities. Development of any new self storage facilities would intensify competition of self storage operators in markets in which we operate.

As of ~~September~~June 30, ~~2019~~2020 and ~~2018,~~2019, we owned 112 and 83111 operating self storage facilities, respectively. The comparability of our results of operations was ~~significantly~~ affected by our acquisition activity in 2019, ~~as listed below.~~

On January 24, 2019, we merged with SSGT, a REIT focused on opportunistic self storage properties, including development and lease-up properties. Through the SSGT Mergers, we acquired 27 operating self storage facilities which had a physical occupancy of approximately 77% at acquisition, along with one property ~~held for sale as of September 30,~~that was subsequently sold in October 2019 located in San Antonio, Texas, one development property in the Greater Toronto, Canada area, and the rights to acquire another property under development in Gilbert, Arizona, which was acquired in July 2019. While the SSGT portfolio generated positive net operating income insince the ~~first nine months~~completion of ~~2019,~~the SSGT Mergers, the portfolio ~~was~~is not yet physically or economically stabilized and is expected to continue to grow in various key metrics. Additionally, during the second quarter of 2020, the SSGT portfolio had a slight revenue decrease from the first quarter of 2020 as a result of COVID-19. However, occupancy for the SSGT properties continued to grow during the second quarter of 2020. The chart below illustrates the growth in occupancy and total revenues in the SSGT portfolio of assets since the completion of the SSGT Mergers:

Over the next 24 to 36 months, we believe the SSGT portfolio will continue to grow revenues and ~~NOI,~~net operating income and will become accretive to FFO, as adjusted, and cash flow over that time. While the SSGT Mergers caused initial dilution in FFO, as adjusted ~~for the current quarter was diluted~~ as a result of ~~the SSGT Mergers and associated~~an increase in debt and interest expense, the progress in metrics such as physical occupancy and total revenue, coupled with the acquisition of the Gilbert property and the completion of the Toronto development property, we believe will result in accretive cash flows, portfolio value and FFO, as adjusted, in the future. ~~While we expect physical~~The SSGT portfolio grew occupancy ~~to continue to improve as~~meaningfully during the ~~SSGT properties continue to approach stabilization,~~second quarter 2020, in the ~~acquisition~~midst of the ~~Gilbert property has caused a short term decline~~COVID-19 pandemic, and while revenue growth was dampened by reduced late fees, pausing existing customer rate increases and lower rental rates to incoming customers, we would expect that pattern of growing revenue to resume in ~~portfolio physical occupancy as of September 30, 2019, and we expect a similar effect on physical occupancy upon~~ the opening and inclusion of the Toronto development in that metric. However, total revenue for the SSGT portfolio has continued to increase, as the other properties continue to increase physical occupancy and achieve higher rental rates.coming quarters, absent further significant impact from COVID-19.

On June 28, 2019, we completed the Self Administration Transaction, in which we became self-managed and succeed to the advisory, asset management and property management businesses and ~~Tenant Programs~~certain joint ventures previously in place for us, SST IV and SSGT II. Additionally, we now have the internal capability to originate, structure and manage additional investment products which would be sponsored by SRA. The Self Administration Transaction and the other transactions discussed herein were approved by our board of directors at the recommendation of a special committee of our board of directors comprised solely of independent directors. As a result of the Self Administration Transaction, we now own all the intellectual property associated with the “SmartStop® Self Storage” brand name, including the trademarks, domain names, websites, internal processes and procedures utilized across the United States and Canada. We also acquired a dedicated workforce of over 350 self storage professionals who were previously employees of SAM. ~~The result of~~With the Self Administration Transaction ~~was that~~ we became a self-managed and fully-integrated self storage company.

Our ~~2019~~ operating results since the completion of the Self Administration Transaction have been, and we expect our operating results in future periods will continue to be, significantly ~~impacted by the Self Administration Transaction.~~impacted. As a result of the Self Administration Transaction, effective June 28, 2019, we no longer incur acquisition, asset and property management fees, which we previously incurred while we were externally advised. Additionally, we now receive incremental Tenant Program revenues as a result of the Self Administration Transaction. However, we now incur additional compensation expense and related overhead ~~related~~ costs. Additionally, we ~~now are~~serve as the sponsor ~~for~~of the Managed REITs, generating revenue and incurring expenses associated with such activities.

As the assets under management of the Managed REITs ~~increase,~~have increased, we ~~expect to see~~have seen an increase in property management and asset management fees, as well as incremental revenues from our Tenant Program joint ventures. At the time of the Self Administration Transaction, the total assets under management of the Managed REITs was approximately $220 million. As of June 30, 2020, the Managed REITs had total assets under management of approximately $404 million, an increase of approximately $184 million since the close of the Self Administration Transaction. See Note 4 of the Notes to the Consolidated Financial Statements contained in this report for additional information.

Below we have summarized the estimated impact, before noncontrolling interests, depreciation, amortization, impairments, contingent earnout adjustments, adjustments to deferred tax liabilities, and interest expense, related to the Self Administration Transaction to our consolidated financial statements ~~for the three and nine months ended September 30, 2019~~ (in millions):

Comparison of ~~Operating Results for~~ the Three Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019

Total self storage related revenues for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$26.9~~$26.1 million and ~~$20.3~~$25.9 million, respectively. The increase in total self storage revenues of approximately ~~$6.5~~$0.2 million, or ~~32%~~0.9%, is primarily attributable to ~~the 28 operating~~increases in non-same-store revenues. Our total self storage ~~facilities acquired~~revenues were otherwise negatively impacted as a result of the COVID-19 pandemic and the resulting suspension of rate increases to our existing customers and significantly less income from late fees. Additionally, in ~~January 2019 and one operating property acquired~~response to reduced prices by our competitors, our rental rates for incoming customers decreased. This was partially offset by an increase in ~~July 2019 in connection with the SSGT Mergers (approximately $6.0 million),~~revenues attributable to incremental Tenant Program revenues ~~generated on our wholly owned assets~~ as a result of the Self Administration Transaction (approximately $0.5 million), and same-store increases of approximately $0.3 million, or 1.5% (see same-store facility results table and related footnotes for the three months ended September 30, 2019 and 2018 for further discussion), partially offset by the impact of adopting ASU 2016-02, which reducedTransaction. We expect total self storage revenues ~~by approximately $0.4 million~~to increase in future periods as ~~amounts previously recorded~~the SSGT and other lease up properties become economically and physically stabilized and revenues to ~~bad debt expense within property operating expenses are now presented as a reduction to~~otherwise fluctuate depending on the economic impact of the COVID-19 pandemic and its impact on the demand for self storage ~~rental revenue.~~.

Managed REIT Platform revenue for the three months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ was approximately ~~$1.2~~$1.9 million and ~~none,~~$30,000, respectively. Such revenue consisted of approximately ~~$0.6~~$1.0 million of asset management fee revenue, approximately ~~$0.3~~$0.4 million of property management fee revenue and approximately ~~$0.3~~$0.4 million of other revenue earned pursuant to our management contracts with the Managed REITs. This revenue was derived from the Managed REIT Platform business, acquired through the Self Administration Transaction on June 28, 2019. We expect our Managed REIT Platform revenue ~~to increase during fiscal year 2019~~will grow in future periods as our Managed REITs acquire additional properties.

Reimbursable costs from Managed REITs for the three months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were approximately $1.5 million and ~~none,~~$50,000, respectively. Such revenues consist of costs incurred by us as we provide property management and advisory services to the Managed REITs, which are reimbursed by our Managed REITs, pursuant to our related contracts with the Managed REITs. We expect reimbursable costs from Managed REITs to increase ~~during fiscal year 2019~~in future periods as our Managed REITs acquire additional properties.

Property operating expenses for the three months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were approximately ~~$9.7~~$9.2 million (or 35.2% of self storage revenue) and ~~$6.4~~$8.8 million (or 33.9% of self storage revenue), respectively. Property operating expenses includes the costs to operate our facilities including ~~compensation~~payroll expense, utilities, insurance, real estate taxes, and marketing. The increase in property operating expenses of approximately ~~$3.3~~$0.4 million, is primarily attributable to ~~the 28 operating self storage facilities acquired in January 2019 and one operating property acquired in July 2019 in connection with the SSGT Mergers, and~~an increase of approximately ~~$0.3~~$0.2 million related to increased ~~property operating~~ compensation expense primarily as a result of the Self Administration ~~Transaction.~~Transaction, and an increase of approximately $0.1 million related to COVID-19 related expenses. We expect property operating expenses to decrease as a percentage of revenue as overall occupancy grows and therefore revenues increases, particularly in the SSGT properties.

Property operating expenses – affiliates for the three months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were none and approximately ~~$2.6~~$3.4 million, respectively. Property operating expenses – affiliates included property management fees and asset management ~~fees related to our Former External Property Managers and our Former External Advisor, respectively.~~fees. The decrease in property operating expenses – affiliates of approximately ~~$2.6~~$3.4 million is attributable to the Self Administration Transaction. As a result of the Self Administration Transaction, we ~~will~~ no longer incur such expenses.

Managed REIT Platformexpenses for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$1.2~~$1.0 million and ~~none,~~$10,000, respectively. Such expenses primarily consisted of expenses related to the Administrative Services Agreement (as discussed in Note 4, Self Administration Transaction, of the Notes to the Consolidated Financial Statements contained in this report), and other non-reimbursable costs associated with the ~~Managed REIT Platform. These expenses are a result~~operation of the Managed REIT Platform ~~business~~ we acquired ~~effective~~on June 28, 2019. We expect Managed REIT Platform expenses to ~~increase~~decrease in future periods due to a reduction in the level of services provided through the Administrative Services Agreement as ~~our~~a result of the suspension of the Managed ~~REITs acquire additional properties.~~REITs’ offerings.

Reimbursable costs from Managed REITs for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately $1.5 million and ~~none,~~$50,000, respectively. Such expenses consist of costs incurred by us as we provide property management and advisory services to the Managed REITs, which are reimbursed by our Managed REITs, pursuant to our related contracts with the Managed REITs. We expect reimbursable costs from Managed REITs to increase ~~during fiscal year 2019~~in future periods as our Managed REITs acquire additional properties.

General and administrative expenses for the three months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were ~~approximately $3.5~~approximately $4.1 million and ~~$1.0~~$1.8 million, respectively. ~~Such~~These expenses ~~have historically consisted~~consist primarily of compensation-related costs, legal expenses, accounting expenses, transfer agent fees, directors and officers’ insurance expense and board of ~~directors related~~directors-related costs. Prior to June 28, 2019, we recognized compensation-related costs ~~and, during the three months ended September 30, 2018, an allocation of~~based on certain required reimbursements from our Former ~~Advisor’s compensation related costs. Additionally, for the three months ended September 30,~~External Advisor. Since June 28, 2019, as a result of the Self Administration Transaction, we ~~recorded~~are now self-managed and employ our own workforce, which resulted in an ~~incremental~~increase of approximately ~~$1.2~~$1.9 million ~~of compensation and overhead~~ related to compensation-related costs ~~now that we are self-managed. The 2018 general and administrative expenses were indicative of an externally-advised structure, as compared~~for the three months ended June 30, 2020 in comparison to the three months ended ~~September~~June 30, ~~2019 where we were self-managed and employed our own workforce of self storage employees.~~2019. We expect general and administrative expenses to decrease as a percentage of total revenues ~~to decrease~~ over ~~time relative to the levels incurred during the three months ended September 30, 2019 now that we are self-managed.~~time.

Depreciation and amortization expenses for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$11.4~~$11.1 million and ~~$5.3~~$9.8 million, respectively. Depreciation expense consists primarily of depreciation on the buildings and site improvements at our properties. Amortization expense consists of the amortization of our in place lease intangible assets resulting from our ~~property~~self storage acquisitions and amortization of certain intangible assets acquired in the Self Administration Transaction. The increase in depreciation and amortization expense is primarily attributable to a full three months of amortization on the ~~28 operating self storage facilities~~intangible assets amortization and depreciation on our corporate office, acquired in ~~January 2019 and one operating property acquired in July 2019 in connection with~~ the ~~SSGT Mergers.~~Self Administration Transaction.

Self Administration Transaction expenses for the three months ended ~~September~~June 30, 2020 and 2019, were none and ~~2018 were~~ approximately ~~$107,000 and none,~~$1.4 million, respectively. Self Administration Transaction expenses ~~consist~~consisted primarily of legal fees, and fees and expenses of our professional and financial advisors.

~~Acquisition expenses – affiliates~~ The contingent earnout adjustments for the three months ended ~~September~~June 30, 2020 and 2019, were approximately $0.5 million and ~~2018 were~~ none, ~~and approximately $16,000,~~ respectively. ~~Acquisition expenses – affiliates primarily relate~~Such adjustment was due to ~~acquisition costs that were payable or reimbursable to an affiliate incurred~~the increase in the ~~pursuit~~estimated fair value of ~~self storage properties which may be acquired in future periods, but do not yet meet our capitalization criteria.~~

~~Other property acquisition expenses for~~ the three months ended September 30, 2019 and 2018 were approximately $26,000 and $555,000, respectively. These acquisition expenses were incurred prior to such acquisitions becoming probable in accordance with our capitalization policy.contingent earnout liability.

Interest expense and the accretion of fair market value of secured debt for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$10.2~~$8.3 million and ~~$4.5~~$9.7 million, respectively. The ~~increase~~decrease of approximately ~~$5.8~~$1.5 million is primarily attributable to ~~the additional~~decreased debt ~~obtained in connection with the SSGT Mergers~~outstanding during the ~~first~~second quarter of 2020 when compared to the second quarter of 2019, and ~~to a lesser extent, the additional debt obtained in connection with the Self Administration Transaction.~~decreased interest rates on variable rate debt. We expect interest expense to fluctuate in future periods commensurate with our future debt ~~level~~levels and interest rates.

Interest expense – debt issuance costs for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$1.1~~$0.9 million and ~~$0.3~~$1.1 million, respectively. The ~~increase~~decrease in interest expense – debt issuance costs of ~~$0.8~~$0.2 million is primarily attributable to the payoff of the Senior Term Loan in the third quarter of 2019 and simultaneous write-off of debt issuance costs related to ~~the new debt obtained~~ ~~in connection with the SSGT Mergers.~~such loan. We expect interest expense - debt issuance costs to fluctuate commensurate with our future financing activity.

~~Other~~Gain resulting from acquisition of unconsolidated affiliates for the three months ended ~~September~~June 30, 2020 and 2019, was none and ~~2018 represented net expenses~~approximately $8.0 million, respectively. The gain was related to our remeasurement to fair value of the Tenant Programs joint ventures upon our acquisition of 100% of such entities in the Self Administration Transaction.

Other income (expense) for the three months ended June 30, 2020 and 2019, was approximately ~~$46,000 and $127,000,~~$0.2 million of income, as compared to approximately $0.3 million of expense, respectively. Other consists primarily of state and federal tax expense, ~~accretion of~~adjustments to deferred tax liabilities, foreign currency fluctuations, and changes in value related to our foreign currency and interest rate hedges not designated for hedge accounting. The change is primarily the result of favorable deferred tax adjustments during the second quarter of 2020.

Same-Store Facility Results - Three Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019

The following table sets forth operating data for our same-store facilities (those properties included in the consolidated results of operations since ~~July~~April 1, ~~2018~~2019, excluding ~~Centennial (which was a lease up facility during 2018)),~~10 lease-up properties we owned as of April 1, 2019) for the three months ended ~~September~~June 30, ~~2019~~2020 and ~~2018.~~2019. We consider the following data to be meaningful as this allows for the comparison of results without the effects of acquisition, lease up, or development activity.

~~The pro forma results shown have been impacted by the Self Administration Transaction along with other normal operations.~~

The same-store pro forma revenue growth of approximately $0.7 million includes approximately $0.4 million of incremental Tenant Program revenues recognized in the three months ended September 30, 2019 as a result of the Self

~~Administration Transaction, along with approximately $0.3 million in normal same-store revenue growth, which represents normal same-store growth of approximately 1.5%.~~

The same-store pro forma property operating expenses decreased approximately $0.5 million consisting of net savings of approximately $1.0 million associated with being self-managed, partially offset by increases in normal same-store property operating expenses of approximately $0.5 million, or approximately 7.4%, primarily related to increased property taxes and advertising expense.

Our same-store revenue decreased by approximately $0.1 million for the three months ended June 30, 2020 compared to the three months ended June 30, 2019 primarily due to the impact of the COVID-19 pandemic and the resulting reduction in late fees, pausing existing customer rate increases and lower rental rates to incoming customers. This was partially offset by an increase in revenues attributable to incremental Tenant Program revenues as a result of the Self Administration Transaction.

Our same-store property operating expenses decreased by approximately ~~$0.8~~$1.2 million for the three months ended ~~September~~June 30, ~~2019~~2020 compared to the three months ended ~~September~~June 30, ~~2018~~2019 primarily due to the elimination of property management fees ~~beginning in July~~effective June 28, 2019, partially offset by an increase in compensation expense as a result of the Self Administration ~~Transaction.~~Transaction, increased advertising expenses, and COVID-19 related costs.

The following table presents a reconciliation of net loss as presented on our consolidated statements of operations to property operating income, as stated above, for the periods indicated:

Comparison of ~~Operating Results for~~ the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019

Total self storage related revenues for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$76.6~~$52.9 million and ~~$60.2~~$49.8 million, respectively. The increase in total self storage revenues of approximately ~~$16.4~~$3.1 million, or ~~27%~~6.2%, is primarily attributable to a full six months of operations for the 28 operating self storage facilities acquired inon January 24, 2019 and the one operating property acquired in July 2019 in connection with the SSGT ~~Mergers (approximately $15.9 million),~~Mergers. The remainder of the increase was primarily attributable to increases in same-store revenues, which was partially attributable to incremental Tenant Program revenues ~~generated on our wholly owned assets~~ as a result of the Self Administration Transaction ~~(approximately $0.5 million), and same-store increases of approximately $0.8 million, or 1.4%~~ (see same-store facility results table and related footnotes for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019 for further discussion)~~, partially offset by the impact of adopting ASU 2016-02, which reduced~~. Our total self storage revenues ~~by approximately $0.9 million as amounts previously recorded to bad debt expense within property operating expenses are now presented~~were otherwise negatively impacted as a ~~reduction~~result of the COVID-19 pandemic and the resulting suspension of rate increases to our existing customers and significantly less income from late fees. Additionally, in response to reduced prices by our competitors, our rental rates for incoming customers decreased. This was partially offset by an increase in revenues attributable to incremental Tenant Program revenues as a result of the Self Administration Transaction. We expect total self storage ~~rental revenue.~~revenues to increase in future periods as the SSGT and other lease up properties become economically and physically stabilized and revenues to otherwise fluctuate depending on the economic impact of the COVID-19 pandemic and its impact on the demand for self storage.

Managed REIT Platform revenue for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ was approximately ~~$1.2~~$3.6 million and ~~none,~~$30,000, respectively. Such revenue consisted of approximately ~~$0.6~~$2.1 million of asset management fee revenue, approximately ~~$0.3~~$0.8 million of property management fee revenue and approximately ~~$0.3~~$0.7 million of other revenue earned pursuant to our management contracts with the Managed REITs. This revenue was derived from the Managed REIT Platform business, ~~effective June 28, 2019, as a result of~~acquired through the Self Administration ~~Transaction.~~Transaction on June 28, 2019. We expect ~~to continue earning~~our Managed REIT Platform ~~revenue during fiscal year 2019 and that such~~ revenue will grow in future periods as our Managed REITs acquire additional properties.

Reimbursable costs from Managed REITs for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were approximately ~~$1.6~~$3.3 million and ~~none,~~$50,000, respectively. Such revenues consist of costs incurred by us as we provide property management and advisory services to the Managed REITs, which are reimbursed by our Managed REITs, pursuant to our related contracts with the Managed REITs. We expect reimbursable costs from Managed REITs to increase ~~during fiscal year 2019~~in future periods as our Managed REITs acquire additional properties.

Property operating expenses for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were approximately ~~$26.6~~$18.9 million (or 35.7% of self storage revenue) and ~~$18.6~~$17.0 million (or 34.1% of self storage revenue), respectively. Property operating expenses includes the costs to operate our facilities including ~~compensation~~payroll expense, utilities, insurance, real estate taxes, and marketing. The increase in property operating expenses of approximately ~~$8.0~~$1.9 million, is primarily attributable to a full six months of operations for the 28 operating self storage facilities acquired inon January 24, 2019 and one operating property acquired inon July 11, 2019 in connection with the SSGT Mergers, ~~(approximately $7.1 million),~~ an increase of approximately ~~$0.3~~$0.6 million related to increased compensation expense primarily as a result of the Self Administration Transaction, and an increase ~~in same-store~~of approximately $0.5 million related to COVID-19 related expenses. We expect property operating expenses to decrease as a percentage of ~~approximately $0.8 million, primarily attributable to~~revenue as overall occupancy grows and therefore revenues increases, particularly in ~~compensation expense, repairs and maintenance, and property taxes.~~the SSGT properties.

Property operating expenses – affiliates for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, were none and ~~2018 were~~ approximately $6.6 ~~million and $7.7~~ million, respectively. Property operating expenses – affiliates ~~includes~~included property management fees and asset management fees. The decrease in property operating expenses – affiliates of approximately ~~$1.1~~$6.6 million is ~~primarily~~ attributable to the Self Administration ~~Transaction, offset by the 28 operating self storage facilities acquired in January 2019 and one operating property acquired in July 2019 in connection with the SSGT Mergers.~~Transaction. As a result of the Self Administration Transaction, we no longer incur such expenses.

Managed REIT Platform expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$1.3~~$2.2 million and ~~none,~~$10,000, respectively. Such expenses primarily consisted of expenses related to the Administrative Services Agreement (as described in Note 4, Self Administration Transaction, of the Notes to the Consolidated Financial Statements contained in this report), and other non-reimbursable costs associated with the ~~Managed REIT Platform. These expenses are a result~~operation of the Managed REIT Platform ~~business~~ we acquired ~~effective~~on June 28, 2019. We expect Managed REIT Platform expenses to ~~increase~~decrease in future periods due to a reduction in the level of services provided through the Administrative Services Agreement as ~~our~~a result of the suspension of the Managed ~~REITs acquire additional properties.~~REITs’ offerings.

Reimbursable costs from Managed REITs for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$1.6~~$3.3 million and ~~none,~~$50,000, respectively. Such expenses consist of costs incurred by us as we provide property management and advisory services to the Managed REITs, which are reimbursed by our Managed REITs, pursuant to our related contracts with the Managed REITs. We expect reimbursable costs from Managed REITs to increase ~~during fiscal year 2019~~in future periods as our Managed REITs acquire additional properties.

General and administrative expenses for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018~~ were ~~approximately $7.0~~approximately $7.8 million and ~~$3.6~~$3.5 million, respectively. ~~Such~~These expenses ~~have historically consisted~~consist primarily of compensation-related costs, legal expenses, accounting expenses, transfer agent fees, directors and officers’ insurance expense ~~an allocation of our Former Advisor’s compensation related costs (through June 27, 2019)~~ and board of ~~directors related~~directors-related costs. ~~Additionally, since~~Prior to June 28, 2019, we recognized compensation-related costs based on certain required reimbursements from our Former External Advisor. Since June 28, 2019, as a result of the Self Administration Transaction, we ~~recorded an incremental approximately $1.2 million of compensation and overhead related costs~~are now ~~that we are self-managed. The 2018 general and administrative expenses were indicative of an externally-advised structure for the entire nine months, whereas effective June 28, 2019, we were~~ self-managed and ~~employed~~employ our own workforce, which resulted in an increase of ~~self storage employees.~~approximately $3.6 million related to compensation-related costs for the six months ended June 30, 2020 in comparison to the six months ended June 30, 2019. We expect general and administrative expenses to decrease as a percentage of total revenues ~~to decrease~~ over ~~time relative to the levels incurred during the three months ended September 30, 2019 now that we are self-managed.~~time.

Depreciation and amortization expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$29.8~~$22.4 million and ~~$17.6~~$18.4 million, respectively. Depreciation expense consists primarily of depreciation on the buildings and site improvements at our properties. Amortization expense consists of the amortization of our in place lease intangible assets resulting from our self storage acquisitions and amortization of certain intangible assets acquired in the Self Administration Transaction. The increase in depreciation and amortization expense is primarily attributable to a full six months of depreciation and amortization on the 28 operating self storage facilities acquired in January 2019 and one operating property acquired in July 2019 in connection with the SSGT ~~Mergers.~~Mergers, as well as the intangible assets amortization and depreciation on our corporate office, acquired in the Self Administration Transaction.

Self administration transaction expenses for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, were none and ~~2018 were~~ approximately ~~$1.6~~$1.5 million, ~~and none,~~ respectively. Self administration transaction expenses ~~consist~~consisted primarily of legal fees, and fees and expenses of our professional and financial advisors.

~~Acquisition expenses – affiliates~~ The contingent earnout adjustments for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$84,000~~$6.7 million and ~~$43,000,~~none, respectively. ~~The acquisition expenses during 2019 primarily relate~~Such adjustment was due to the ~~costs~~decrease in the estimated fair value of the contingent earnout liability.

Impairment of goodwill and intangible assets for the six months ended June 30, 2020 and 2019, was approximately $36.5 million and none, respectively. The impairment charge is the result of the impairment of certain assets and goodwill associated with the ~~SSGT Mergers prior to such merger becoming probable~~Managed REIT Platform.

Impairment of investments in ~~accordance with our capitalization policy.~~Managed REITs

~~Other property acquisition expenses~~Impairment of investments in Managed REITs for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$0.1~~$4.4 million and ~~$0.8 million, respectively. These acquisition expenses~~none, respectively. We determined that the value of our equity investments in the Managed REITs, which derive their value from the potential to receive certain subordinated distributions based on certain performance criteria of the Managed REITs that are now less likely to be met, were ~~incurred prior to~~impaired. We determined that such ~~acquisitions becoming probable in accordance with our capitalization policy.~~impairment was other than temporary, therefore requiring an impairment charge.

Interest expense and the accretion of fair market value of secured debt for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$28.5~~$16.6 million and ~~$13.1~~$18.3 million, respectively. The ~~increase~~decrease of approximately ~~$15.4~~$1.7 million is primarily attributable to ~~the additional~~decreased debt ~~obtained in connection with the SSGT Mergers~~outstanding during the first ~~quarter~~six months of 2020 when compared to the first six months of 2019, and ~~to a lesser extent, the additional debt obtained in connection with the Self Administration Transaction.~~decreased interest rates on variable rate debt. We expect interest expense to fluctuate in future periods commensurate with our future debt ~~level~~levels and interest rates.

Interest expense – debt issuance costs for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$3.0~~$1.9 million and ~~$1.0~~$1.9 million, respectively. ~~The increase in~~We expect interest expense ~~– debt issuance costs of $2.0 million is primarily attributable to~~ ~~costs related to the new debt obtained~~ ~~in connection with the SSGT Mergers. We expect~~- debt issuance costs to fluctuate commensurate with our future financing activity.

Net loss on extinguishment of debt for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, were none and ~~2018 was~~ approximately $1.5 million, ~~and none,~~ respectively. ~~The increase in net~~Net loss on debt extinguishment ~~is primarily~~in the six months ended June 30, 2019 was attributable to prepayment penalties related to the early pay off of the Raleigh/Myrtle Beach promissory note, and the write-off of unamortized debt issuance costs on loans that were paid off in connection with the SSGT Mergers.

Gain resulting from acquisition of unconsolidated affiliates for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, was none and ~~2018 was~~ approximately $8.0 million, ~~and none,~~ respectively. The gain was related to our remeasurement to fair value of the Tenant Programs joint ventures upon our acquisition of 100% of such entities in the Self Administration Transaction.

Other income (expense) for the ~~nine~~six months ended ~~September~~June 30, 2020 and 2019, ~~and 2018 represented net expenses~~was approximately $2.7 million of income, as compared to approximately ~~$0.4 million and~~ $0.3 million of expense, respectively. Other consists primarily of state and federal tax expense, ~~accretion of~~adjustments to deferred tax liabilities, foreign currency fluctuations, and changes in value related to our foreign currency and interest rate hedges not designated for hedge accounting. The change is primarily the result of favorable deferred tax adjustments of approximately $2.4 million related to the intangible impairment analyses noted above.

The following table sets forth operating data for our same-store facilities (those properties included in the consolidated results of operations since January 1, ~~2018, excluding Centennial (which was a lease up facility during 2018)~~2019) for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018.~~2019. We consider the following data to be meaningful as this allows for the comparison of results without the effects of acquisition, lease up, or development activity.

~~The pro forma results shown have been impacted by the Self Administration Transaction along with other normal operations.~~

The same-store pro forma revenue growth of approximately $1.2 million includes approximately $0.4 million of incremental Tenant Program revenues recognized in the three months ended September 30, 2019 as a result of the Self Administration Transaction, along with approximately $0.8 million in normal same-store revenue growth, which represents normal same-store growth of approximately 1.4%.

The same-store pro forma property operating expenses increased approximately $0.5 million consisting of increases in normal same-store property operating expenses of approximately $1.5 million, or approximately 7.0%, primarily related to increased property taxes and advertising expense, partially offset by net savings of approximately $1.0 million associated with being self-managed.

Our same-store revenue increased by approximately $0.7 million for the six months ended June 30, 2020 compared to the six months ended June 30, 2019 primarily due to higher occupancy and higher annualized revenue per occupied square foot, combined with an increase in revenues attributable to incremental Tenant Program revenues as a result of the Self Administration Transaction. Revenue growth was negatively impacted by the COVID-19 pandemic and the resulting waived late fees, pausing of existing customer rate increases and lower rental rates to incoming customers.

Our same-store property operating expenses decreased by approximately ~~$0.4~~$1.5 million for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 compared to the ~~nine~~six months ended ~~September~~June 30, ~~2018~~2019 primarily due to the elimination of property management fees effective June ~~29,~~28, 2019, ~~and approximately $0.9 million of bad debt expense recorded in property operating expenses for the nine months ended September 30, 2018, prior to the adoption of ASU 2016-02,~~ partially offset by an increase in compensation expense as a result of the Self Administration ~~Transaction.~~Transaction, increased advertising expenses, and COVID-19 related costs.

The following table presents a reconciliation of net loss as presented on our consolidated statements of operations to property operating income, as stated above, for the periods indicated:

Funds from operations (“FFO”) is an industry wide metric promulgated by the National Association of Real Estate Investment Trusts, or NAREIT, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure.

We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, or the White Paper. The White Paper defines FFO as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of property and real estate related asset impairment write downs, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Additionally, gains and losses from change in control are excluded from the determination of FFO. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. Our FFO calculation complies with NAREIT’s policy described above.

We use FFO, as adjusted, as an additional non-GAAP financial measure to evaluate our operating performance. We previously used Modified Funds from Operations (“MFFO”) (as defined by the Institute for Portfolio Alternatives) as a non-GAAP measure of operating performance. Management replaced the MFFO measure with FFO, as adjusted, because FFO, as adjusted, provides investors with supplemental performance information that is consistent with the performance models and analysis used by management. In addition, FFO, as adjusted, is a measure used among our peer group, which includes publicly traded REITs. Further, we believe FFO, as adjusted, is useful in comparing the sustainability of our operating performance with the sustainability of the operating performance of other real estate companies.

In determining FFO, as adjusted, we make further adjustments to the NAREIT computation of FFO to exclude the effects of non-real estate related intangible amortization, acquisition related costs, contingent earnout expenses, accretion of fair value of debt adjustments, gains or losses from extinguishment of debt, accretion of deferred tax liabilities, realized and unrealized gains/losses on foreign exchange transactions, and gains/losses on foreign exchange and interest rate derivatives not designated for hedge accounting, which we believe are not indicative of the Company’s overall long-term operating performance. We exclude these items from GAAP net income to arrive at FFO, as adjusted, as they are not the primary drivers in our decision-making process and excluding these items provides investors a view of our continuing operating portfolio performance over time and makes our results more comparable period to period and to other REITs, which in any respective period may experience fluctuations in such acquisition, merger or other similar activities that are not of a long-term operating performance nature. FFO, as adjusted, also reflects adjustments for unconsolidated partnerships and jointly owned investments. We use FFO, as adjusted, as one measure of our operating performance when we formulate corporate goals and evaluate the effectiveness of our strategies.

Presentation of FFO and FFO, as adjusted, is intended to provide useful information to investors as they compare the operating performance of different REITs, although it should be noted that not all REITs calculate FFO and FFO, as adjusted, the same way, so comparisons with other REITs may not be meaningful. Furthermore, FFO and FFO, as adjusted, are not necessarily indicative of cash flow available to fund cash needs and should not be considered as an alternative to net income (loss) or income (loss) from continuing operations as an indication of our performance, as an alternative to cash flows from operations, which is an indication of our liquidity, or indicative of funds available to fund our cash needs including our ability to make distributions to our stockholders. FFO and FFO, as adjusted, should not be considered as an alternative to net income (determined in accordance with GAAP) and should be reviewed in conjunction with other measurements as an indication of our performance.

Neither the SEC, NAREIT, nor any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO or FFO, as adjusted. In the future, the SEC, NAREIT or another regulatory body may decide to standardize the allowable adjustments across the publicly registered, non-traded REIT industry, and we would have to adjust our calculation and characterization of FFO or FFO, as adjusted. The following is a reconciliation of net income (loss), which is the most directly comparable GAAP financial measure, to FFO and FFO, as adjusted, for each of the periods presented below:

As discussed in the Results of Operations, our 2019 results have been significantly impacted by the SSGT Mergers and additional debt incurred to finance such acquisition. The information below should be read in conjunction with the discussion regarding the SSGT Mergers and Self Administration Transaction.

Provided below is additional information related to selected non-cash items included in net loss above, which may be helpful in assessing our operating results:

A comparison of cash flows for operating, investing and financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, is as follows:

Cash flows provided by operating activities for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$8.1~~$14.2 million and ~~$16.4~~$3.9 million, respectively, ~~a decrease~~an increase of approximately ~~$8.2~~$10.2 million. The ~~decrease~~increase in cash provided by our operating activities is primarily the result of ~~a decrease~~an increase in net income when excluding the impact of non-cash ~~adjustments, including depreciation, amortization, net loss on extinguishment~~items included in the determination of ~~debt, and gain resulting from acquisition of unconsolidated affiliates. The decrease in~~ net income, ~~when excluding the impact of non-cash adjustments comprises a decrease~~which resulted in an increase in cash provided by operating activities of approximately ~~$10.9~~$9.3 million, ~~offset by an increase of~~as well as approximately ~~$2.7~~$0.9 million resulting from ~~a change~~changes in working capital ~~accounts.~~.

Cash flows used in investing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$359.1~~$7.4 million and ~~$2.2~~$346 million, respectively, a ~~change~~decrease in the use of cash of approximately ~~$356.9~~$339 million. The ~~change~~reduction in cash used in investing activities primarily relates to cash consideration paid of approximately $346 million for the SSGT Mergers in the first quarter of ~~2019.~~2019 as compared to only normal capital improvement and development activities with no acquisitions of real estate during the six months ended June 30, 2020.

Cash flows (used in) provided by ~~(used in)~~ financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019, were approximately ~~$358.7~~($17) million and ~~($17.0 million),~~$350 million, respectively, a change of approximately ~~$375.7~~$367 million. The ~~increase~~change in ~~cash provided by~~ financing activities is primarily attributable to the approximately ~~$379.1~~$363 million ~~increase in~~of net debt issued induring the six months ended June 30, 2019, as well as an additional approximately $7 million of distributions paid primarily ~~related~~on our Series A Preferred Stock and to other non-controlling interest holders during the ~~SSGT Mergers.~~six months ended June 30, 2020 .

~~Our Primary Offering terminated on January 9, 2017.~~ We generally expect that we will meet our short-term liquidity requirements from the combination of ~~the proceeds from secured or unsecured financing from banks or other lenders, the issuance of equity instruments, including from the sale of our Series A Preferred Stock, and~~existing cash balances, net cash provided by property operations and the Managed REIT ~~Platform.~~

Platform as well as the proceeds from potential further issuances of our Series A Convertible Preferred Stock. Alternatively, we may issue additional secured or unsecured financing from banks or other lenders. COVID-19 has caused significant volatility in the debt and equity markets and the continued and/or further impact will depend on future developments, which are highly uncertain. While, we do not expect such events to have a material impact upon our liquidity in the short-term, continued volatility or further deterioration in the debt and equity markets over an extended period of time could potentially impact our liquidity over the long-term.

On October 29, 2019 (the “Commitment Date”), we entered into a preferred stock purchase agreement (the “Purchase Agreement”) with Extra Space Storage LP (the “Investor”), a subsidiary of Extra Space Storage Inc. (NYSE: EXR), pursuant to which the Investor committed to purchase up to $200 million in shares (the aggregate shares to be purchased, the ~~“Shares”~~“Preferred Shares”) of our new Series A Convertible Preferred Stock (the “Series A Convertible Preferred Stock”), in one or more closings (each, a “Closing,” and collectively, the “Closings”). The initial closing (the “Initial Closing”) in the amount of $150 million occurred on the Commitment Date. The Investor has committed to purchase up to an additional $50 million, at our option, within 12 months following the Initial Closing, subject to certain limitations. See Note ~~14—Series A~~8, Preferred ~~Stock Purchase Agreement~~Equity, of the Notes to the Consolidated Financial Statements contained in this report for additional information.

The shares of Series A Convertible Preferred Stock rank senior to all other shares of our capital stock, including our common stock, with respect to rights to receive dividends and to participate in distributions or payments upon any voluntary or involuntary liquidation, dissolution or winding up of the Company. Dividends payable on each share of Series A Convertible Preferred Stock will initially be equal to a rate of 6.25% per annum, which accrues daily but is payable quarterly in arrears. If the Series A Convertible Preferred Stock has not been redeemed on or prior to the fifth anniversary date of the Initial Closing, the dividend rate will increase an additional 0.75% per annum each year thereafter to a maximum of 9.0% per annum until the tenth anniversary of the Initial Closing, at which time the dividend rate shall increase 0.75% per annum each year thereafter until the Series A Convertible Preferred Stock is ~~redeemed~~either converted or repurchased in full.

On ~~September 20, 2019,~~May 26, 2020, our board of directors declared a distribution rate for ~~the fourth quarter of 2019~~June 2020, of approximately ~~$0.001644~~$0.00164 per day per share on the outstanding shares of common stock payable to both Class A and Class T stockholders of record of such shares as shown on our books at the close of business on each day during the period, commencing on ~~October~~June 1, ~~2019~~2020 and continuing on each day thereafter through and including ~~December~~June 30, 2020. On June 23, 2020, our board of directors declared a distribution rate for July 2020 of approximately $0.00164 per day per share on the outstanding shares of common stock payable to both Class A and Class T stockholders of record of such shares as shown on our books at the close of business on each day during the period, commencing on July 1, 2020, and continuing on each day thereafter through and including July 31, ~~2019.~~2020. On July 22, 2020, our board of directors declared a distribution rate for August 2020 of approximately $0.00164 per day per share on the outstanding shares of common stock payable to both Class A and Class T stockholders of record of such shares as shown on our books at the close of business on each day during the period, commencing on August 1, 2020, and continuing on each day thereafter through and including August 31, 2020. In connection with ~~this distribution,~~these distributions, after the stockholder servicing fee is paid, approximately $0.0014 per day will be paid per Class T share. Such distributions payable to each stockholder of record during a month will be paid the following month.

Historically, we ~~have~~had primarily made distributions to our common stockholders using proceeds of the Offering in anticipation of future cash flow. As such, this reduced the amount of capital we ultimately had available to invest in properties. Because substantially all of our operations will be performed indirectly through our Operating Partnership, our ability to pay distributions depends in large part on our Operating Partnership’s ability to pay distributions to its partners, including to us. In the event we do not have enough cash from operations to fund cash distributions, we may borrow, issue additional securities or sell assets in order to fund the distributions. The terms of the Series A Convertible Preferred Stock place certain restrictions on our ability to pay distributions to our common stockholders. In general, we are prohibited from paying distributions to our common stockholders other than regular cash dividends on a basis consistent with past practice and dividends payable in shares of common stock in connection with an initial listing of such shares. Accordingly, we are presently ~~required~~only permitted to pay ~~only~~ cash ~~distributions.~~distributions, which may be reinvested in stock pursuant to our DRP, unless otherwise approved by the holder of the Series A Convertible Preferred Stock. Absent the foregoing restrictions, our charter allows our board of directors to authorize payments to stockholders in cash or other assets of the Company or in stock, including in stock of one class payable to holders of stock of another class.

~~For some period after our Offering, we~~We may not be able to pay distributions from our cash flows from operations, in which case distributions may be paid in part from debt ~~financing.~~or other financing sources.

Distributions are paid to our common stockholders based on the record date selected by our board of directors. We currently declare and pay such distributions monthly based on daily declaration and record dates so that investors may be entitled to distributions immediately upon purchasing our shares. We expect to continue to regularly pay distributions unless our results of operations, our general financial condition, general economic conditions, or other factors inhibit us from doing so. Distributions are authorized at the discretion of our board of directors, which are directed, in substantial part, by its obligation to cause us to comply with the REIT requirements of the Code. ~~Our~~Absent the restrictions noted above, our board of directors may increase, decrease or eliminate the distribution rate that is being paid on our common stock at any time. Distributions are made on all classes of our common stock at the same time. The per share amount of distributions on Class A Shares and Class T Shares differ because of different allocations of class-specific expenses. Specifically, distributions on Class T Shares are lower than distributions on Class A Shares because Class T Shares are subject to ongoing stockholder servicing fees. The funds that are available for distribution may be affected by a number of factors, including the following:

The following shows our distributions paid and the sources of such distributions for the respective periods presented:

From our inception through ~~September~~June 30, ~~2019,~~2020, we paid cumulative distributions of approximately ~~$123.1~~ $157million, as compared to cumulative FFO of approximately ~~$23.5~~($1.7) million. For the ~~nine~~six months ended ~~September~~June 30, 2020, we paid distributions of approximately $24.2 million, as compared to FFO of approximately ($26.5) million, which reflects impairment of goodwill, intangible assets, and our investments in Managed REITs, net of deferred tax liability and contingent earnout adjustments, of approximately $31.1 million, and acquisition related expenses of approximately $125,000. For the six months ended June 30, 2019, we paid distributions of approximately ~~$26.7~~$17.1 million, as compared to FFO of approximately ($~~0.8)~~1.1) million, which reflects acquisition related expenses of approximately ~~$0.2 million,~~$168,000, and a net loss on extinguishment of debt of approximately $1.5 ~~million. For the nine months ended September 30, 2018, we paid distributions of approximately $25.4~~ million ~~as compared to an FFO of approximately $14.8 million which reflects acquisition related expenses of approximately $0.9 million.~~. The payment of distributions from sources other than FFO may reduce the amount of proceeds available for investment and operations or cause us to incur additional interest expense as a result of borrowed funds.

We must distribute to our stockholders at least 90% of our taxable income each year in order to meet the requirements for being treated as a REIT under the Code. Our directors may authorize distributions in excess of this percentage as they deem appropriate. Because we may receive income from interest or rents at various times during our fiscal year, distributions may not reflect our income earned in that particular distribution period, but may be made in anticipation of cash flow that we expect to receive during a later period and may be made in advance of actual receipt of funds in an attempt to make distributions relatively uniform. To allow for such differences in timing between the receipt of income and the payment of expenses, and the effect of required debt payments, among other things, we could be required to borrow funds from third parties on a short-term basis, issue new securities, or sell assets to meet the distribution requirements that are necessary to achieve the tax benefits associated with qualifying as a REIT. We are not prohibited from undertaking such activities by our charter, bylaws or investment policies, and we may use an unlimited amount from any source to pay our distributions. These methods of obtaining funding could affect future distributions by increasing operating costs and decreasing available cash, which could reduce the value of our stockholders’ investment in our shares. In addition, such distributions may constitute a return of investors’ capital.

We may not be able to pay distributions from our cash flows from operations, in which case distributions may be paid in part from available funds, proceeds received through potential further issuances of our Series A Convertible Preferred Stock, from debt financing and pursuant to our distribution reinvestment plan. The payment of distributions from sources other than cash flows from operations may reduce the amount of proceeds available for investment and operations or cause us to incur additional interest expense as a result of borrowed funds.

Over the long-term, we expect that a greater percentage of our distributions will be paid from cash flows from operations. However, our operating performance cannot be accurately predicted and may deteriorate in the future due to numerous factors, including our ability to raise and invest capital at favorable yields, the financial performance of our investments in the current real estate and financial environment and the types and mix of investments in our portfolio. As a result, future distributions declared and paid may exceed cash flow from operations.

As of ~~September~~June 30, ~~2019,~~2020, our ~~total indebtedness~~net debt was approximately ~~$815.3~~$710 million, which included approximately ~~$302.4~~$302 million in fixed rate debt, ~~$522.0~~$413 million in variable rate debt and approximately ~~$0.6~~$0.5 million in net debt premium less approximately ~~$9.8~~$5.7 million in net debt issuance costs. ~~Some~~One of our loans ~~have~~has an initial maturity ~~dates within the next year.~~date in October 2020. We intend to ~~repay these loans~~either extend this loan pursuant to existing extension options, or refinance through ~~loan extensions or~~ other debt financing. See Note 67 of the Notes to the Consolidated Financial Statements for more information about our ~~indebtedness, and Note 14 about our pay down of debt subsequent to September 30, 2019.~~indebtedness.

On a long-term basis, our principal demands for funds will be for property acquisitions, either directly or through entity interests, for the payment of operating expenses and distributions, and for the payment of interest on our outstanding indebtedness, if any.

Long-term potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, issuance of equity instruments, undistributed funds from operations, and additional public or private offerings. To the extent we are not able to secure requisite financing in the form of a credit facility or other debt, we will be dependent upon proceeds from the issuance of equity securities and cash flows from operating activities in order to meet our long-term liquidity requirements and to fund our distributions.

The following table summarizes our contractual obligations as of ~~September~~June 30, ~~2019:~~2020

Other than our minority equity investment in an auction company we utilize to facilitate our auctions, we do not currently have any relationships with unconsolidated entities or financial partnerships. Such entities are often referred to as structured finance or special purpose entities, which typically are established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Please see Note 1416 of the Notes to the Consolidated Financial Statements contained in this report.

We believe that we will experience minor seasonal fluctuations in the occupancy levels of our facilities, which we believe will be slightly higher over the summer months due to increased moving activity.

Market risk includes risks that arise from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other market changes that affect market sensitive instruments. In pursuing our business plan, we expect that the primary market risk to which we will be exposed is interest rate risk and to a lesser extent, foreign currency risk. We may be exposed to the effects of interest rate changes primarily as a result of borrowings used to maintain liquidity and fund acquisition, expansion, and financing of our real estate investment portfolio and operations. Our interest rate risk management objectives will be to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs. To achieve our objectives, we may borrow at fixed rates or variable rates. We may also enter into derivative financial instruments such as interest rate swaps and caps in order to mitigate our interest rate risk on a related financial instrument. We will not enter into derivative or interest rate transactions for speculative purposes.

As of ~~September~~June 30, 2020, our net debt was approximately $710 million, which included approximately $302 million in fixed rate debt, $413 million in variable rate debt and approximately $0.5 million in net debt premium less approximately $5.7 million in net debt issuance costs. As of December 31, 2019, our net debt was approximately ~~$815.3~~$713 million, which included approximately ~~$302.4~~$302 million in fixed rate debt, ~~$522.0~~$418 million in variable rate debt and approximately $0.6 million in net debt premium less approximately $9.8 million in net debt issuance costs. As of December 31, 2018, our net debt was approximately $406.1 million, which included approximately $225.6 million in fixed rate debt, $182.6 million in variable rate debt and approximately $1.2 million in net debt premium less approximately $3.4$7.6 million in net debt issuance costs. Our debt instruments were entered into for other than trading purposes. Changes in interest rates have different impacts on the fixed and variable debt. A change in interest rates on fixed rate debt impacts its fair value but has no impact on interest incurred or cash flows. A change in interest rates on variable debt could impact the interest incurred and cash flows and its fair value. If the underlying rate of the related index on our variable rate debt were to increase by 100 basis points, the increase in interest would decrease future earnings and cash flows by approximately ~~$1.2~~$0.9 million annually.

Interest rate risk amounts were determined by considering the impact of hypothetical interest rates on our financial instruments. These analyses do not consider the effect of any change in overall economic activity that could occur. Further, in the event of a change of that magnitude, we may take actions to further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, these analyses assume no changes in our financial structure.

The following table summarizes ~~future~~annual debt maturities and average interest rates on our outstanding debt as of ~~September~~June 30, ~~2019:~~2020:

Currently, our only foreign exchange rate risk comes from our Canadian properties and the Canadian Dollar (“CAD”). Our existing foreign currency hedge mitigates most of our foreign currency exposure of our net CAD denominated investments; however, we generate all of our revenues and expend essentially all of our operating expenses and third party debt service costs related to our Canadian ~~properties~~Properties in CAD. As a result of fluctuations in currency exchange, our cash flows and results of operations could be affected.

As of the end of the period covered by this report, management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the disclosure controls and procedures were effective as of the end of the period covered by this report to ensure that information required to be disclosed in the reports we file and submit under the Exchange Act is recorded, processed, summarized and reported as and when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports we file and submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There have been no changes in our internal control over financial reporting that occurred during the quarter ended ~~September~~June 30, ~~2019~~2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial ~~reporting.~~reporting.

The following should be read in conjunction with the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019. With the exception of the risk factors set forth below, there have been no material changes from the risk factors set forth in our ~~2018~~2019 Annual Report on Form 10-K for the year ended December 31, ~~2018.~~2019.

We have incurred a net loss to date, have an accumulated deficit, and it is possible that our operations may not be profitable in ~~2019.~~2020.

We incurred a net loss attributable to common stockholders of approximately ~~$19.3~~$44 million for the ~~nine~~six months ended ~~September~~June 30, ~~2019.~~2020. Our accumulated deficit was approximately ~~$81.7~~$131 million as of ~~September~~June 30, ~~2019.~~2020.

We may only calculate the value per share for our shares annually and, therefore, our stockholders may not be able to determine the net asset value of their shares on an ongoing basis.

On ~~June 26, 2019,~~April 20, 2020, our board of directors approved an estimated value per share for our Class A shares and Class T shares of ~~$10.66.~~$10.40. Our board of directors approved this estimated value per share pursuant to rules promulgated by FINRA, which require us to disclose an estimated per share value of our shares based on a valuation no later than 150 days following the second anniversary of the date on which we broke escrow in our Offering.FINRA. When determining the estimated value per share there are currently no SEC, federal and state rules that establish requirements specifying the methodology to employ in determining an estimated value per share; provided, however, that the determination of the estimated value per share must be conducted by, or with the material assistance or confirmation of, a third-party valuation expert or service and must be derived from a methodology that conforms to standard industry practice.

We calculated our estimated value per share as of December 31, 2019, which was prior to the emergence of the novel coronavirus (“COVID-19”) in the United States. We are unable to quantify the potential impact of the COVID-19 pandemic on our estimated value per share until we have greater visibility into how the spread of the disease may affect our operations or the broader economic environment. Future valuations of our properties or other assets and liabilities could be affected by COVID-19 or any associated weakened economic conditions. We intend to use this estimated per share value of our shares until the next net asset valuation approved by our board of directors, which we are required to approve at least annually. We may not calculate the net asset value per share for our shares more than annually. Therefore, you may not be able to determine the net asset value of your shares on an ongoing basis.

In determining our estimated value per share, we primarily relied upon a valuation of our portfolio of properties as of ~~March~~December 31, 2019. Valuations and appraisals of our properties are estimates of fair value and may not necessarily correspond to realizable value upon the sale of such properties; therefore our estimated net asset value per share may not reflect the amount that would be realized upon a sale of each of our properties.

For the purposes of calculating the estimated value per share, an independent third party appraiser valued our properties as of ~~March~~December 31, 2019. The valuation methodologies used to value our properties involved certain subjective judgments. Ultimate realization of the value of an asset depends to a great extent on economic and other conditions beyond our control and the control of our independent appraiser. Further, valuations do not necessarily represent the price at which an asset would sell, since market prices of assets can only be determined by negotiation between a willing buyer and seller. Therefore, the valuations of our properties and our investments in real estate related assets may not correspond to the timely realizable value upon a sale of those assets. Because our share prices are primarily based on the estimated net asset value per share, our stockholders may pay more than realizable value when such shares are purchased or receive less than realizable value when such shares are sold.

Revenue from the Managed REITs is dependent in large part on the ability to raise capital in offerings for existing or future Managed REITs or other future programs, as well as on our ability to make investments that meet the investment criteria of existing and future entities, both of which are subject to uncertainty with respect to capital market and real estate market conditions. This uncertainty may create volatility in our earnings because of the resulting fluctuation in the Managed REITs’ revenue. Revenue generated from asset management fees, property management fees and other fees and distributions relating to the Managed REITs’ offerings and the investment and management of their respective assets may be affected by factors that include not only our ability to increase the Managed REITs’ portfolio of properties under management, but also changes in valuation of those properties, as well as sales of the Managed REIT properties and assets.

The Managed REITs may not generate sufficient revenue or may incur significant debt, which either due to liquidity problems or restrictive covenants contained in their borrowing agreements could restrict their ability to pay or reimburse fees and expenses owed to us when due. In addition, the revenue payable by the Managed REITs is subject to certain limits set forth in their respective advisory agreements, which may limit the growth of our revenue. Furthermore, our ability to earn certain subordinated distributions from the Managed REITs is tied to providing liquidity events for the Managed REITs. Our ability to provide such liquidity events, and to do so under circumstances that will satisfy the applicable subordination requirements, will depend on market conditions at the relevant time, which may vary considerably over a period of years. We may generate significantly higher revenue and income in years in which a liquidity event occurs for a Managed REIT.

Because the revenue streams from the advisory agreements with the Managed REITs are subject to limitation or cancellation, any such termination could adversely affect our financial condition, cash flow and the amount available for distributions to you.

Our advisory agreement with the SST IV Advisor is renewable annually, and our advisory agreement with the SSGT II Advisor has an initial term of 10 years and is renewable annually thereafter, and each may generally be terminated by each Managed REIT, without cause or penalty, upon 60 days’ written notice. There can be no assurance that the advisory agreements will be renewed before they expire or that the advisory agreements will not be terminated. Any such non-renewal or termination could adversely affect our financial condition, cash flow and the amount available for distributions to you.

~~Impairment of goodwill or other intangible assets resulting from the Self Administration Transaction may adversely affect our financial condition and results of operations.~~

Potential impairment of goodwill or other intangible assets, including trademarks and other acquired intangibles, resulting from the Self Administration Transaction could adversely affect our financial condition and results of operations. We assess our goodwill and other intangible assets and long-lived assets for impairment at least annually or upon the occurrence of a triggering event, as required by GAAP. We are required to record an impairment charge if circumstances indicate that the asset carrying values exceed their fair values. Our assessment of goodwill, other intangible assets, or long-lived assets could indicate that an impairment of the carrying value of such assets may have occurred that could result in a material, non-cash write-down of such assets, which could have a material adverse effect on our results of operations and future earnings.

Our trademarks are important to the value of our business, and the inability to protect, and costs associated with protecting, our intellectual property could adversely affect our business and results of operations.

~~In connection with the Self Administration Transaction, we acquired trademarks and other intellectual property rights, including but not limited to the “SmartStop~~^®~~” and “Strategic Storage~~^®” brands, which are important to our success and competitive position, and the loss of or our inability to enforce trademark and other proprietary intellectual property rights could harm our business. We will devote substantial resources to the establishment and protection of our trademarks and other proprietary intellectual property rights.

Our efforts to protect our intellectual property may not be adequate. Third parties may misappropriate or infringe on our intellectual property. From time to time, we may engage in litigation to protect our intellectual property, which could result in substantial costs as well as diversion of management attention. The occurrence of any of these risks could adversely affect our business and results of operations.

As a result of the Self Administration Transaction, we are a newly self-managed REIT. We no longer bear the costs of the various fees and expense reimbursements previously paid to our former external advisor and its affiliates; however, our expenses include the compensation and benefits of our officers, employees and consultants, as well as overhead previously paid by our former external advisor and its affiliates. Our employees now provide services historically provided by the external advisors and their affiliates. We are subject to potential liabilities that are commonly faced by employers, such as workers’ disability and compensation claims, potential labor disputes, and other employee-related liabilities and grievances, and we bear the cost of the establishment and maintenance of any employee compensation plans. In addition, we have not previously operated as a self-managed REIT and may encounter unforeseen costs, expenses, and difficulties associated with providing these services on a self-advised basis. If we incur unexpected expenses as a result of our self-management, our results of operations could be more negatively impacted than they otherwise would have been.

On September 17, 2019, the Company’s board of directors approved the amendment and restatement of the Company’s bylaws (the “Amended and Restated Bylaws”), which became effective upon approval. The general intent of the Amended and Restated Bylaws is to conform the Company’s bylaws to the provisions of the Company’s Second Amended and Restated Charter. Additionally, the Amended and Restated Bylaws reflect recent updates and developments in public company governance. Among other updates, the Amended and Restated Bylaws establish the procedures for stockholders to make director nominations and other stockholder proposals for consideration at stockholder meetings, including: (a) expanding the stockholder qualifications required to make director nominations, (b) expanding the advance notice provisions for director nominations and other stockholder proposals to provide the Board sufficient time and information to adequately consider and respond to such nominations or proposals, and (c) providing additional procedures to govern the consideration of director nominations at a stockholder meeting. A copy of the complete text of the Amended and Restated Bylaws of the Company, effective September 17, 2019, is attached as Exhibit 3.3 to this Quarterly Report on Form 10-Q and incorporated into this Item 5 disclosure by reference.None.

The exhibits required to be filed with this report are set forth on the Exhibit Index hereto and incorporated by reference herein.

The following exhibits are included in this report on Form 10-Q for the period ended ~~September~~June 30, ~~2019~~2020 (and are numbered in accordance with Item 601 of Regulation S-K).

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Page No.
	Cautionary Note Regarding Forward-Looking Statements	3

PART I.	FINANCIAL INFORMATION	4

Item 1.	Consolidated Financial Statements:	4
	Consolidated Balance Sheets as of ~~September~~June 30, ~~2019~~2020 (unaudited) and December 31, ~~2018~~2019	5
	Consolidated Statements of Operations for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019 (unaudited)	6
	Consolidated Statements of Comprehensive Loss for the Three and ~~Nine~~Six Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019 (unaudited)	7
	Consolidated Statements of Equity for the Three Months Ended March 31, ~~2018,~~2019 and June 30, ~~2018, and September 30, 2018~~2019 (unaudited)	8
	Consolidated Statements of Equity for the Three Months Ended March 31, ~~2019,~~2020 and June 30, ~~2019, and September 30, 2019~~2020 (unaudited)	910
	Consolidated Statements of Cash Flows for the ~~Nine~~Six Months Ended ~~September~~June 30, ~~2019~~2020 and ~~2018~~2019 (unaudited)	1112
	Notes to Consolidated Financial Statements (unaudited)	1314
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	5556
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	7578
Item 4.	Controls and Procedures	7679

PART II.	OTHER INFORMATION	7880

Item 1.	Legal Proceedings	7880
Item 1A.	Risk Factors	7880
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	8081
Item 3.	Defaults Upon Senior Securities	8081
Item 4.	Mine Safety Disclosures	8081
Item 5.	Other Information	8081
Item 6.	Exhibits	8081

	Three Months Ended September 30,						Nine Months Ended September 30,
	2019			2018			2019			2018
Net loss	$	(9,541,579	)	$	(457,278	)	$	(20,773,868	)	$	(2,561,655	)
Other comprehensive income (loss):
Foreign currency translation adjustment		(651,011	)		1,343,451			1,408,709			(2,061,322	)
Foreign currency hedge contract gains (losses)		(84,696	)		(1,083,267	)		(1,970,862	)		2,431,232
Interest rate swap and cap contract gains (losses)		(823,250	)		(5,139	)		(4,000,275	)		504,393
Other comprehensive income (loss)		(1,558,957	)		255,045			(4,562,428	)		874,303
Comprehensive loss		(11,100,536	)		(202,233	)		(25,336,296	)		(1,687,352	)
Comprehensive loss attributable to noncontrolling interests:
Comprehensive loss attributable to the noncontrolling interests in our Operating Partnership		1,543,525			2,589			1,774,600			14,473
Comprehensive loss attributable to SmartStop Self Storage REIT, Inc. common stockholders	$	(9,557,011	)	$	(199,644	)	$	(23,561,696	)	$	(1,672,879	)

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Net loss	$	(7,062,841	)	$	(2,283,972	)	$	(44,806,422	)	$	(11,232,290	)
Other comprehensive income (loss):
Foreign currency translation adjustment		1,959,220			1,192,459			(2,607,900	)		2,059,720
Foreign currency hedge contract gains (losses)		(1,932,451	)		(1,039,585	)		2,634,344			(1,886,166	)
Interest rate swap and cap contract gains (losses)		672,354			(1,861,933	)		(4,803,195	)		(3,177,025	)
Other comprehensive gain (loss)		699,123			(1,709,059	)		(4,776,751	)		(3,003,471	)
Comprehensive loss		(6,363,718	)		(3,993,031	)		(49,583,173	)		(14,235,761	)
Comprehensive loss attributable to noncontrolling interests:
Comprehensive loss attributable to the noncontrolling interests in our Operating Partnership		841,054			125,049			6,600,750			162,589
Comprehensive loss attributable to SmartStop Self Storage REIT, Inc. stockholders	$	(5,522,664	)	$	(3,867,982	)	$	(42,982,423	)	$	(14,073,172	)

Supplemental disclosures and non-cash transactions:
Cash paid for interest	$	26,457,563	$	13,534,949	$	16,772,069	$	16,422,557
Supplemental disclosure of noncash activities:
Issuance of shares pursuant to distribution reinvestment plan	$	12,059,591	$	12,042,676	$	7,990,892	$	8,013,210
Distributions payable	$	3,326,601	$	2,801,394	$	5,868,759	$	2,879,771
Additions to real estate and construction in process included in accounts payable					$	334,128	$	432,353
Redemption of common stock included in accounts payable and accrued liabilities	$	405,971	$	4,638,448	$	—	$	2,052,077
Deposit applied to the purchase of real estate	$	1,000,000	$	—
Additions to real estate and construction in process included in accounts payable	$	864,237	$	65,160
Issuance of units in our Operating Partnership in SSGT Mergers	$	4,217,399	$	—	$	—	$	4,217,399
Debt assumed in SSGT Mergers	$	5,038,435	$	—	$	—	$	5,038,435
Net liabilities assumed in SSGT Mergers	$	1,712,596	$	—	$	—	$	1,712,596
Write-off of unamortized debt issuance costs	$	356,519	$	—	$	—	$	356,519
Issuance of Class A-1 units in our Operating Partnership in the Self Administration Transaction	$	63,643,000	$	—	$	—	$	63,643,000
Debt assumed in the Self Administration Transaction	$	19,219,126	$	—	$	—	$	19,219,126
Contingent earnout consideration issued in the Self Administration Transaction	$	30,900,000	$	—	$	—	$	30,900,000
Issuance of limited partnership units in our Operating Partnership in exchange for special limited partnership interest	$	18,800,000	$	—	$	—	$	18,800,000
Deferred tax liabilities related to the Self Administration Transaction	$	7,415,654	$	—	$	—	$	7,415,654
Accounts payable and other accrued liabilities assumed in the Self Administration Transaction	$	722,286	$	—	$	—	$	722,286
Transfer of other assets to debt issuance costs	$	1,075,000	$	—	$	—	$	1,075,000
Foreign currency contracts, interest rate swaps, and interest rate cap contract in accounts payable and accrued liabilities and other assets	$	3,947,904	$	735,942
Prepaid debt issuance costs included in accounts payable and accrued liabilities	$	—	$	155,439

Description		Standard Depreciable Life
Land		Not Depreciated
Buildings		30-40 years
Site Improvements		7-10 years

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
None	None	None

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒☐
		Emerging growth company	☒☐

	September 30, 2019				December 31, 2018
	Fair Value		Carrying Value		Fair Value		Carrying Value
Fixed Rate Secured Debt	$	316,560,000	$	303,028,569	$	200,600,000	$	207,357,391

	June 30, 2020				December 31, 2019
	Fair Value		Carrying Value		Fair Value		Carrying Value
Fixed Rate Secured Debt	$	320,500,000	$	302,405,789	$	311,700,000	$	302,820,786

Real estate facilities
Balance at December 31, 2018	$	820,296,026
Facilities acquired through merger with SSGT		334,139,296
Corporate office acquired through Self Administration Transaction		6,500,000
Other facility acquisitions		10,430,942
Real estate reclassified to held for sale		(11,690,958	)
Impact of foreign exchange rate changes		4,183,185
Improvements and additions		4,338,265
Balance at September 30, 2019	$	1,168,196,756
Accumulated depreciation
Balance at December 31, 2018	$	(54,264,685	)
Depreciation expense		(21,643,576	)
Impact of foreign exchange rate changes		(241,041	)
Real estate reclassified to held for sale		202,416
Balance at September 30, 2019	$	(75,946,886	)

Real estate facilities
Balance at December 31, 2019	$	1,173,825,368
Construction in process placed in service		13,263,262
Impact of foreign exchange rate changes		(7,620,467	)
Improvements and additions		4,452,282
Balance at June 30, 2020	$	1,183,920,445
Accumulated depreciation
Balance at December 31, 2019	$	(83,692,491	)
Depreciation expense		(15,293,130	)
Impact of foreign exchange rate changes		549,640
Balance at June 30, 2020	$	(98,435,981	)

Fair value of consideration transferred:
Cash	$	346,231,561	⁽¹⁾
Issuance of limited partnership units in our Operating Partnership to SS Growth Advisor, LLC		4,217,399
Total consideration transferred	$	350,448,960

Assets Acquired:
Land	$	62,261,573
Buildings		255,743,767
Site improvements		16,133,956
Construction in process		5,370,773
Intangible assets		13,571,765
Cash and cash equivalents		692,965
Other assets		6,536,838
Total assets acquired	$	360,311,637
Liabilities assumed:
Debt	$	5,038,435
Accounts payable and accrued liabilities		4,824,242
Total liabilities assumed	$	9,862,677
Total net assets acquired	$	350,448,960

Estimated Fair Value of Consideration Transferred
Cash⁽¹⁾	$	3,918,185
Class A-1 Units		63,643,000
Class A-2 Units (contingent earnout)		30,900,000
Total Consideration Transferred		98,461,185
Fair value of our preexisting 50% equity interests		12,800,000
Total	$	111,261,185

Identifiable Assets Acquired at Fair Value
Cash and cash equivalents	$	36,443
Restricted cash		94,999
Land		975,000
Building		5,389,000
Site Improvements		136,000
Equipment, furniture and fixtures		651,000
Investments in Managed REITs		5,600,000
Other assets		1,084,629
Intangibles - customer relationships		1,600,000
Trademarks		19,800,000
Intangibles - management contracts		24,900,000
Total identifiable assets acquired	$	60,267,071

Identifiable Liabilities Assumed at Fair Value
Debt	$	19,219,126
Accounts payable and accrued expenses		722,286
Deferred tax liabilities, net		7,415,654
Total liabilities assumed	$	27,357,066
Net identifiable assets acquired	$	32,910,005
Goodwill		78,372,980
Non-controlling interest related to consolidated Tenant Programs joint ventures		(21,800	)
Net assets acquired	$	111,261,185

	For the Nine Months ended						For the Six Months ended
	September 30, 2019			September 30, 2018			June 30, 2019			June 30, 2020
Pro forma revenue	$	83,809,401		$	62,518,667		$	54,182,467		$	59,767,668
Pro forma operating expenses	$	(76,382,169	)	$	(52,578,442	)	$	(48,943,530	)	$	(88,331,968	)
Pro forma net income (loss) attributable to common stockholders	$	(22,254,892	)	$	(3,450,094	)	$	(14,317,825	)	$	(43,181,285	)

Encumbered Property	September 30, 2019			December 31, 2018			Interest Rate			Maturity Date	June 30, 2020			December 31, 2019			Interest Rate			Maturity Date
KeyBank CMBS Loan⁽⁵⁾⁽¹⁾	$	95,000,000		$	95,000,000			3.89	%	8/1/2026	$	95,000,000		$	95,000,000			3.89	%	8/1/2026
KeyBank Florida CMBS Loan⁽⁶⁾⁽²⁾		52,000,000			52,000,000			4.65	%	5/1/2027		52,000,000			52,000,000			4.65	%	5/1/2027
Midland North Carolina CMBS Loan⁽⁷⁾⁽³⁾		47,203,386			47,249,999			5.31	%	8/1/2024		46,738,807			47,048,287			5.31	%	8/1/2024
Canadian CitiBank Loan⁽⁸⁾⁽⁴⁾		82,543,360			72,846,480			4.21	%	10/9/2020		81,582,900			85,500,660			2.77	%	10/9/2020
CMBS SASB Loan⁽⁹⁾⁽⁵⁾		235,000,000		—				5.02	%	2/9/2022		235,000,000			235,000,000			3.16	%	2/9/2022
CMBS Loan⁽¹⁰⁾		104,000,000		—				5.00	%	2/1/2029
Secured Loan^{(11) (13)}		95,362,000		—				4.52	%	1/24/2022
Senior Term Loan^{(12) (13)}		86,300,000		—				6.27	%	1/24/2022
Stoney Creek Loan⁽¹⁴⁾		5,497,319		—				5.90	%	10/1/2021
Torbarrie Loan⁽¹⁵⁾		2,791,947		—				5.90	%	3/1/2023
CMBS Loan⁽⁶⁾												104,000,000			104,000,000			5.00	%	2/1/2029
Secured Loan^{(7) (8)}												85,512,000			85,512,000			3.00	%	1/24/2022
Stoney Creek Loan⁽⁹⁾												5,335,719			5,591,950			4.65	%	10/1/2021
Torbarrie Loan⁽¹⁰⁾												6,000,627			5,936,996			4.65	%	9/1/2021
Ladera Office Loan		4,199,915			—			4.29	%	11/1/2026		4,140,024			4,179,994			4.29	%	11/1/2026
KeyBank Tenant Program Loan		14,554,306			—			5.52	%	5/9/2021
Raleigh/Myrtle Beach promissory note⁽¹⁾		—			11,878,396			5.73	%	N/A
Amended KeyBank Credit Facility⁽²⁾		—			98,782,500			5.00	%	N/A
Oakland and Concord loan⁽³⁾		—			19,483,127			3.95	%	N/A
$11M KeyBank Subordinate Loan⁽⁴⁾		—			11,000,000			6.25	%	N/A
Premium on secured debt, net		625,267			1,228,996							526,958			592,505
Debt issuance costs, net		(9,758,342	)		(3,385,395	)						(5,720,351	)		(7,629,390	)
Total debt	$	815,319,158		$	406,084,103						$	710,116,684		$	712,733,002

Merger Financings	Principal Borrowing as of Merger Date
CMBS SASB Loan	$	235,000,000
CMBS Loan		104,000,000
Secured Loan		89,178,000
Senior Term Loan		72,000,000
Total	$	500,178,000

Merger Financings	Principal Repaid
Raleigh/Myrtle Beach promissory note	$	11,862,471
Amended KeyBank Credit Facility		98,782,500
Oakland and Concord loan		19,443,753
$11M KeyBank Subordinate Loan		11,000,000
Total	$	141,088,724

2020	$	81,941,703
2021		12,630,984
2022		323,426,828
2023		3,384,577
2024		47,035,145
2025 and thereafter		246,890,840
Total payments		715,310,077
Premium on secured debt, net		526,958
Debt issuance costs, net		(5,720,351	)
Total	$	710,116,684

2019⁽¹⁾	$	729,326
2020⁽¹⁾		86,251,637
2021⁽¹⁾		17,791,959
2022		419,576,829
2023		6,176,525
2024 and thereafter		293,925,957
Total payments⁽²⁾		824,452,233
Premium on secured debt, net		625,267
Debt issuance costs, net		(9,758,342	)
Total	$	815,319,158

	Notional Amount			Strike			Effective Date or Date Assumed	Maturity Date	Notional Amount			Strike			Effective Date	Maturity Date
Interest Rate Swaps:
LIBOR Swap	$	161,178,000	⁽³⁾		2.61	%	January 24, 2019	August 1, 2020	$	85,512,000			2.61	%	January 24, 2019	August 1, 2020
LIBOR Swap		235,000,000			1.79	%	June 15, 2019	February 15, 2022		235,000,000			1.79	%	June 15, 2019	February 15, 2022
Interest Rate Cap:
CDOR Cap	$	99,300,000	⁽¹⁾		3.00	%	October 11, 2018	October 15, 2021	$	99,300,000	⁽¹⁾		3.00	%	October 11, 2018	October 15, 2021
CDOR Cap		1,000,000	⁽¹⁾		3.00	%	March 28, 2019	October 15, 2021		1,000,000	⁽¹⁾		3.00	%	March 28, 2019	October 15, 2021
CDOR Cap		11,700,000	⁽¹⁾		3.00	%	May 28, 2019	October 15, 2021		11,700,000	⁽¹⁾		3.00	%	May 28, 2019	October 15, 2021
Foreign Currency Option:
Foreign Currency Forward:
Denominated in CAD	$	95,000,000	⁽¹⁾⁽²⁾		1.372		July 8, 2019	December 9, 2019	$	95,000,000	⁽¹⁾		1.334		February 10, 2020	February 10, 2021

	Notional Amount			Strike			Effective Date or Date Assumed	Maturity Date	Notional Amount			Strike			Effective Date	Maturity Date
Interest Rate Swaps:
Oakland and Concord loan	$	19,483,127	⁽²⁾		3.95	%	May 18, 2016	April 10, 2023
LIBOR Swap									$	85,512,000			2.61	%	January 24, 2019	August 1, 2020⁽³⁾
LIBOR Swap										235,000,000			1.79	%	June 15, 2019	February 15, 2022
Interest Rate Cap:
CDOR Cap	$	99,300,000	⁽¹⁾		3.00	%	October 11, 2018	October 15, 2021	$	99,300,000	⁽¹⁾		3.00	%	October 11, 2018	October 15, 2021
Foreign Currency Forward:
CDOR Cap										1,000,000	⁽¹⁾		3.00	%	March 28, 2019	October 15, 2021
CDOR Cap										11,700,000	⁽¹⁾		3.00	%	May 28, 2019	October 15, 2021
Foreign Currency Option:
Denominated in CAD	$	90,000,000	⁽¹⁾		1.2846		March 28, 2018	January 28, 2019 ⁽³⁾	$	95,000,000	⁽¹⁾		1.323		December 9, 2019	February 10, 2020⁽²⁾

	Asset/Liability Derivatives				Asset/Liability Derivatives
	Fair Value				Fair Value
Balance Sheet Location	September 30, 2019		December 31, 2018		June 30, 2020		December 31, 2019
Interest Rate Swaps
Other assets	$	—	$	361,802
Accounts payable and accrued liabilities		3,147,573	—		$	6,533,137	$	1,695,140
Interest Rate Caps
Other assets	$	59,358	$	87,808	$	—	$	28,847
Accounts payable and accrued liabilities		25,611	—
Foreign Currency Hedges
Other assets	$	65,652	$	4,016,806	$	1,202,140	$	—
Accounts payable and accrued liabilities						—		1,425,632

	Three Months Ended June 30, 2020
				Managed REIT			Corporate
	Self Storage			Platform			and Other			Total
Revenues:
Self storage rental revenue	$	24,946,793		$	—		$	—		$	24,946,793
Ancillary operating revenue		1,183,418			—			—			1,183,418
Managed REIT Platform revenue		—			1,852,893			—			1,852,893
Reimbursable costs from Managed REITs		—			1,486,441			—			1,486,441
Total revenues		26,130,211			3,339,334			—			29,469,545
Operating expenses:
Property operating expenses		9,195,043			—			—			9,195,043
Managed REIT Platform expense		—			1,008,014			—			1,008,014
Reimbursable costs from Managed REITs		—			1,486,441			—			1,486,441
General and administrative		—			—			4,149,713			4,149,713
Depreciation		7,720,655			—			121,788			7,842,443
Intangible amortization expense		2,191,854			1,026,298			—			3,218,152
Other acquisition expenses		97,221			—			—			97,221
Contingent earnout expense		—			500,000			—			500,000
Total operating expenses		19,204,773			4,020,753			4,271,501			27,497,027
Operating income (loss)		6,925,438			(681,419	)		(4,271,501	)		1,972,518
Other income (expense):
Interest expense		(8,239,472	)		—			(44,957	)		(8,284,429	)
Interest expense – accretion of fair market value of secured debt		32,892			—			—			32,892
Interest expense – debt issuance costs		(933,919	)		—			(2,359	)		(936,278	)
Other		(35,900	)		174,145			14,211			152,456
Net loss	$	(2,250,961	)	$	(507,274	)	$	(4,304,606	)	$	(7,062,841	)

	Three Months Ended June 30, 2019
				Managed REIT			Corporate
	Self Storage			Platform			and Other			Total
Revenues:
Self storage rental revenue	$	25,154,971		$	—		$	—		$	25,154,971
Ancillary operating revenue		749,375			—			—			749,375
Managed REIT Platform revenue		—			29,062			—			29,062
Reimbursable costs from Managed REITs		—			47,109			—			47,109
Total revenues		25,904,346			76,171			—			25,980,517
Operating expenses:
Property operating expenses		8,775,557			—			—			8,775,557
Property operating expenses – affiliates		3,380,954			—			—			3,380,954
Managed REIT Platform expense		—			10,569			—			10,569
Reimbursable costs from Managed REITs		—			47,109			—			47,109
General and administrative		—			—			1,826,886			1,826,886
Depreciation		7,420,510			—			—			7,420,510
Intangible amortization expense		2,286,161			68,171			—			2,354,332
Self administration transaction expenses		—			—			1,350,188			1,350,188
Acquisition expenses – affiliates		45,119			—			—			45,119
Other acquisition expenses		387			—			—			387
Total operating expenses		21,908,688			125,849			3,177,074			25,211,611
Operating income (loss)		3,995,658			(49,678	)		(3,177,074	)		768,906
Other income (expense):
Interest expense		(9,760,794	)		—			(1,508	)		(9,762,302	)
Interest expense – accretion of fair market value of secured debt		33,191			—			—			33,191
Interest expense – debt issuance costs		(1,073,725	)		—			—			(1,073,725	)
Gain resulting from acquisition of unconsolidated affiliates		8,017,353			—			—			8,017,353
Other		(267,395	)		—			—			(267,395	)
Net loss	$	944,288		$	(49,678	)	$	(3,178,582	)	$	(2,283,972	)

	Six Months Ended June 30, 2019
				Managed REIT			Corporate
	Self Storage			Platform			and Other			Total
Revenues:
Self storage rental revenue	$	48,386,620		$	—		$	—		$	48,386,620
Ancillary operating revenue		1,401,051			—			—			1,401,051
Managed REIT Platform revenue		—			29,062			—			29,062
Reimbursable costs from Managed REITs		—			47,109			—			47,109
Total revenues		49,787,671			76,171			—			49,863,842
Operating expenses:
Property operating expenses		16,974,602			—			—			16,974,602
Property operating expenses – affiliates		6,605,670			—			—			6,605,670
Managed REIT Platform expense		—			10,569			—			10,569
Reimbursable costs from Managed REITs		—			47,109			—			47,109
General and administrative		—			—			3,481,070			3,481,070
Depreciation		14,288,918			—			—			14,288,918
Intangible amortization expense		4,013,137			68,171			—			4,081,308
Self administration transaction expenses		—			—			1,488,271			1,488,271
Acquisition expenses – affiliates		84,061			—			—			84,061
Other acquisition expenses		84,236			—			—			84,236
Total operating expenses		42,050,624			125,849			4,969,341			47,145,814
Operating income (loss)		7,737,047			(49,678	)		(4,969,341	)		2,718,028
Other income (expense):
Interest expense		(18,322,296	)		—			(1,508	)		(18,323,804	)
Interest expense – accretion of fair market value of secured debt		65,659			—			—			65,659
Interest expense – debt issuance costs		(1,915,258	)		—			—			(1,915,258	)
Net loss on extinguishment of debt		(1,487,867	)		—			—			(1,487,867	)
Gain resulting from acquisition of unconsolidated affiliates		8,017,353			—			—			8,017,353
Other		(306,401	)		—			—			(306,401	)
Net loss	$	(6,211,763	)	$	(49,678	)	$	(4,970,849	)	$	(11,232,290	)

Segments	September 30, 2019		June 30, 2020
Self Storage	$	1,139,087,776	$	1,157,571,515	⁽¹⁾
Managed REIT Platform		29,739,174		30,962,182	⁽¹⁾
Corporate and Other⁽¹⁾		110,835,320		49,392,991
Total assets	$	1,279,662,270	$	1,237,926,688

	Year Ended December 31, 2018						Nine Months Ended September 30, 2019						Year Ended December 31, 2019						Six Months Ended June 30, 2020
	Incurred		Paid		Payable		Incurred		Paid		Payable		Incurred		Paid		Payable		Incurred		Paid		Payable
Expensed
Operating expenses (including organizational costs)	$	2,199,596	$	2,336,075	$	209,385	$	975,985	$	1,185,370	$	—
Operating expenses													$	975,985	$	1,185,370	$	—	$	—	$	—	$	—
Transfer Agent fees		352,300		302,839		49,461		324,943		374,404		—		324,943		374,404		—		313,618		282,962		30,656
Asset management fees		5,445,528		5,445,528		—		3,622,558		3,622,558		—		3,622,559		3,622,559		—		—		—		—
Property management fees		4,809,106		4,809,106		—		2,983,111		2,983,111		—		2,983,110		2,983,110		—		—		—		—
Acquisition expenses		72,179		72,179		—		80,102		80,102		—		84,061		84,061		—		—		—		—
Capitalized
Acquisition costs		48,664		48,664		—		235,932		235,932		—		235,932		235,932		—		—		—		—
Self Administration Transaction working capital true-up		—		—		—		493,785		493,785		—		493,785		493,785		—		—		—		—
Additional paid-in capital
Stockholder servicing fee⁽¹⁾		—		675,049		1,944,991		—		502,961		1,442,030		—		667,651		1,277,340		—		323,529		953,811
Total	$	12,927,373	$	13,689,440	$	2,203,837	$	8,716,416	$	9,478,223	$	1,442,030	$	8,720,375	$	9,646,872	$	1,277,340	$	313,618	$	606,491	$	984,467

Managed REIT Platform Revenues	Three Months Ended September 30, 2019		Nine Months Ended September 30, 2019		Three Months Ended June 30, 2020		Six Months Ended June 30, 2020
Property management agreement – SST IV	$	288,026	$	296,300	$	333,034	$	672,497
Property management agreement – SSGT II		40,222		40,822		76,832		151,555
Advisory agreement – SST IV		490,844		506,470		775,213		1,545,854
Advisory agreement – SSGT II		117,380		121,942		271,458		507,093
Tenant Program revenue – SST IV		120,498		120,498		191,862		357,750
Tenant Program revenue – SSGT II		15,895		15,895		50,156		79,613
Other Managed REIT revenue(1)		119,800		119,800		154,338		322,318
Total	$	1,192,665	$	1,221,727	$	1,852,893	$	3,636,680

	Restricted Stock					LTIPs
Time Based Award Grants	Shares			Weighted-Average Grant-Date Fair Value		Units		Weighted-Average Grant-Date Fair Value
Unvested at December 31, 2018		21,438		$	10.38	$	—	$	—
Granted		251,993			9.48		—		—
Vested		(7,625	)		10.29		—		—
Forfeited		—			—		—		—
Unvested at December 31, 2019		265,806		$	9.53		—	$	—
Granted		72,383			9.78		214,521		9.09
Vested		(64,732	)		9.57		—		—
Forfeited		(6,567	)		9.78		—		—
Unvested at June 30, 2020		266,890		$	9.58		214,521	$	9.09

	Restricted Stock				LTIPs
Performance Based Award Grants	Shares		Weighted-Average Grant-Date Fair Value		Units		Weighted-Average Grant-Date Fair Value
Unvested at December 31, 2019		—	$	—		—	$	—
Granted		5,752		9.78		130,638		9.09
Vested		—		—		—		—
Forfeited		—		—		—		—
Unvested at June 30, 2020		5,752	$	9.78		130,638	$	9.09

Restricted Stock Grants	Shares			Weighted-Average Grant-Date Fair Value
Non-Vested at December 31, 2018		21,438		$	10.38
Granted		249,062			9.48
Vested		(7,625	)		10.29
Non-Vested at September 30, 2019		262,875		$	9.53

Number Years Held		Redemption Price
Less than 1		NaN Redemption Allowed
1 or more but less than 3		90.0% of Redemption Amount
3 or more but less than 4		95.0% of Redemption Amount
4 or more		100.0% of Redemption Amount

	Three months ended															Three months ended
	September 30, 2018			December 31, 2018			March 31, 2019			June 30, 2019			September 30, 2019			June 30, 2019			September 30, 2019			December 31, 2019			March 31, 2020			June 30, 2020
Total revenues	$	20,313,069		$	20,187,215		$	23,883,325		$	25,980,517		$	29,588,014		$	25,980,517		$	29,588,014		$	30,076,693		$	30,298,123		$	29,469,545
Total operating expenses	$	15,836,436		$	15,808,549		$	21,934,203		$	25,211,611		$	27,773,486		$	25,211,611		$	27,773,486		$	26,965,933		$	61,368,274		$	27,497,027
Operating income	$	4,476,633		$	4,378,666		$	1,949,122		$	768,906		$	1,814,528
Operating income (loss)																$	768,906		$	1,814,528		$	7,055,456		$	(31,070,151	)	$	1,972,518
Net loss	$	(457,278	)	$	(1,159,075	)	$	(8,948,317	)	$	(2,283,972	)	$	(9,541,579	)	$	(2,283,972	)	$	(9,541,579	)	$	(4,321,670	)	$	(37,743,581	)	$	(7,062,841	)
Net loss attributable to common stockholders	$	(451,424	)	$	(1,158,694	)	$	(8,891,558	)	$	(2,212,445	)	$	(8,214,826	)	$	(2,212,445	)	$	(8,214,826	)	$	(5,431,504	)	$	(35,073,951	)	$	(8,491,421	)
Net loss per Class A Share-basic and diluted	$	(0.01	)	$	(0.02	)	$	(0.15	)	$	(0.04	)	$	(0.14	)	$	(0.04	)	$	(0.14	)	$	(0.09	)	$	(0.59	)	$	(0.14	)
Net loss per Class T Share-basic and diluted	$	(0.01	)	$	(0.02	)	$	(0.15	)	$	(0.04	)	$	(0.14	)	$	(0.04	)	$	(0.14	)	$	(0.09	)	$	(0.59	)	$	(0.14	)