Business Wire | Feb 24, 2021 04:04PM EST

Public Storage Reports Results for the Fourth Quarter and Year Ended December 31, 2020

Feb. 24, 2021

GLENDALE, Calif.--(BUSINESS WIRE)--Feb. 24, 2021--Public Storage (NYSE:PSA) announced today operating results for the fourth quarter and year ended December 31, 2020.

Comment from the CEO

"At Public Storage, our focus on the health and safety of employees and customers, enhancing the industry's leading platform and brand, and utilizing unparalleled capital access to fund growth drove our success in 2020," said Joe Russell, President and Chief Executive Officer. "The outlook is favorable as we enter 2021. Public Storage is transforming the customer experience through innovation amidst strong consumer demand while executing on a robust external growth environment through property acquisitions, development, and redevelopment."

Operating Results for the Three Months Ended December 31, 2020

For the three months ended December 31, 2020, net income allocable to our common shareholders was $292.2 million or $1.67 per diluted common share, compared to $327.3 million or $1.87 per diluted common share in 2019 representing a decrease of $35.1 million or $0.20 per diluted common share. The decrease is due primarily to (i) a $35.4 million decrease due to the impact of foreign currency exchange losses associated with our Euro denominated debt and (ii) a $12.3 million increase in general and administrative expense, partially offset by (iii) a $16.5 million increase in self-storage net operating income (described below).

The $16.5 million increase in self-storage net operating income is a result of a $6.3 million increase in our Same Store Facilities (as defined below) and a $10.2 million increase in our non-Same Store Facilities (as defined below). Revenues for the Same Store Facilities increased 0.8% or $4.7 million in the three months ended December 31, 2020 as compared to 2019, due primarily to improved occupancy. Cost of operations for the Same Store Facilities decreased by 1.1% or $1.6 million in the three months ended December 31, 2020 as compared to 2019, due primarily to a 9.3% ($2.6 million) decrease in on-site property manager payroll. The increase in net operating income of $10.2 million for the non-Same Store Facilities is due primarily to the impact of facilities acquired in 2019 and 2020 and the fill-up of recently developed and expanded facilities.

Operating Results for the Year Ended December 31, 2020

In 2020, net income allocable to our common shareholders was $1,098.3 million or $6.29 per diluted common share, compared to $1,272.8 million or $7.29 per diluted common share in 2019 representing a decrease of $174.4 million or $1.00 per diluted common share. The decrease is due primarily to (i) a $105.8 million decrease due to the impact of foreign currency exchange gains and losses associated with our Euro denominated debt, (ii) a $40.3 million increase in depreciation and amortization expense, (iii) a $21.1 million increase in general and administrative expense, (iv) a $15.6 million decrease due to the impact of allocations to preferred shareholders with respect to redemption of preferred shares, and (v) a $8.0 million decrease in self-storage net operating income (described below).

The $8.0 million decrease in self-storage net operating income is a result of a $41.7 million decrease in our Same Store Facilities, offset partially by a $33.7 million increase in our non-Same Store Facilities. Revenues for the Same Store Facilities decreased 1.0% or $23.7 million in 2020 as compared to 2019, due primarily to reduced late charges and administrative fees. Cost of operations for the Same Store Facilities increased by 2.7% or $18.1 million in 2020 as compared to 2019, due primarily to a 22.5% ($11.0 million) increase in marketing expenses, a 3.1% ($7.4 million) increase in property tax expense, and a 2.5% ($3.1 million) increase in on-site property manager payroll expense. The increase in net operating income of $33.7 million for the non-Same Store Facilities is due primarily to the impact of facilities acquired in 2019 and 2020 and the fill-up of recently developed and expanded facilities.

Funds from Operations

For the three months ended December 31, 2020, funds from operations ("FFO") was $2.57 per diluted common share, as compared to $2.72 in 2019, representing a decrease of 5.5%. FFO is a non-GAAP measure defined by the National Association of Real Estate Investment Trusts and generally represents net income before depreciation and amortization expense, gains and losses and impairment charges with respect to real estate assets. A reconciliation of GAAP diluted net income per share to FFO per share, and additional descriptive information regarding this non-GAAP measure, is attached.

For the year ended December 31, 2020, FFO was $9.75 per diluted common share, as compared to $10.58 in 2019, representing a decrease of 7.8%.

We also present "Core FFO per share," a non-GAAP measure that represents FFO per share excluding the impact of (i) foreign currency exchange gains and losses, (ii) EITF D-42 charges related to the redemption of preferred securities, and (iii) certain other significant non-cash and/or nonrecurring income or expense items such as loss contingency accruals, casualties, due diligence, and advisory costs. We review Core FFO per share to evaluate our ongoing operating performance, and we believe it is used by investors and REIT analysts in a similar manner. However, Core FFO per share is not a substitute for net income per share. Because other REITs may not compute Core FFO per share in the same manner as we do, may not use the same terminology or may not present such a measure, Core FFO per share may not be comparable among REITs.

The following table reconciles from FFO per share to Core FFO per share (unaudited):



Three Months Ended December Year ended December 31, 31,

Percentage Percentage

2020 2019 Change 2020 2019 Change



FFO per share $ 2.57 $ 2.72 (5.5 )% $ 9.75 $ 10.58 (7.8 )%

Eliminate theper share impact of

items excludedfrom Core FFO, including

our equityshare from investments:

Foreigncurrency 0.26 0.06 0.56 (0.04 ) exchange loss(gain)

Application of 0.06 0.06 0.28 0.21 EITF D-42

Other items 0.04 - 0.02 -

Core FFO per $ 2.93 $ 2.84 3.2 % $ 10.61 $ 10.75 (1.3 )%share



Property Operations - Same Store Facilities

The Same Store Facilities consist of facilities that have been owned and operated on a stabilized level of occupancy, revenues and cost of operations since January 1, 2018. The composition of our Same Store Facilities allows us to more effectively evaluate the ongoing performance of our self-storage portfolio in 2018, 2019, and 2020 and exclude the impact of fill-up of unstabilized facilities, which can significantly affect operating trends. We believe the Same Store information is used by investors and REIT analysts in a similar manner. The following table summarizes the historical operating results of these 2,221 facilities (143.7 million net rentable square feet) that represent approximately 82% of the aggregate net rentable square feet of our U.S. consolidated self-storage portfolio at December 31, 2020.



Selected Operating Data for the Same

Store Facilities (2,221 facilities)

(unaudited):

Three Months Ended December 31, Year ended December 31,

Percentage Percentage

2020 2019 Change 2020 2019 Change

(Dollar amounts in thousands, except for per square foot data)

Revenues:

Rental income $ 600,528 $ 588,177 2.1 % $ 2,355,576 $ 2,353,625 0.1 %

Late charges and 18,984 26,605 (28.6 )% 80,970 106,604 (24.0 )%administrative fees

Total revenues (a) 619,512 614,782 0.8 % 2,436,546 2,460,229 (1.0 )%



Direct cost of operations (a):

Property taxes 38,778 38,969 (0.5 )% 247,860 240,451 3.1 %

On-site property 25,750 28,395 (9.3 )% 125,051 121,978 2.5 %manager payroll

Repairs and 12,371 11,667 6.0 % 46,582 47,445 (1.8 )%maintenance

Snow removal 598 881 (32.1 )% 2,639 4,058 (35.0 )%

Utilities 9,090 10,327 (12.0 )% 39,459 43,461 (9.2 )%

Marketing 13,075 13,207 (1.0 )% 59,901 48,911 22.5 %

Other direct property 17,107 16,149 5.9 % 66,646 65,331 2.0 %costs

Total direct cost of 116,769 119,595 (2.4 )% 588,138 571,635 2.9 %operations

Direct net operating 502,743 495,187 1.5 % 1,848,408 1,888,594 (2.1 )%income (b)

Indirect cost of operations (a):

Supervisory payroll (8,769 ) (8,327 ) 5.3 % (39,291 ) (37,719 ) 4.2 %

Centralized management (12,204 ) (11,824 ) 3.2 % (47,713 ) (49,453 ) (3.5 )%costs

Share based (3,169 ) (2,734 ) 15.9 % (12,686 ) (10,956 ) 15.8 %compensation

Net operating income $ 478,601 $ 472,302 1.3 % $ 1,748,718 $ 1,790,466 (2.3 )%(c)



Gross margin (before indirect costs,

depreciation and 81.2 % 80.5 % 0.9 % 75.9 % 76.8 % (1.2 )%amortization expense)



Gross margin (before depreciation

and amortization 77.3 % 76.8 % 0.7 % 71.8 % 72.8 % (1.4 )%expense)



Weighted average for the period:

Square foot occupancy 95.2 % 93.1 % 2.3 % 94.5 % 93.4 % 1.2 %

Realized annual rental income per (d):

Occupied square foot $ 17.56 $ 17.60 (0.2 )% $ 17.34 $ 17.53 (1.1 )%

Available square foot $ 16.72 $ 16.38 2.1 % $ 16.40 $ 16.38 0.1 %("REVPAF")

At December 31:

Square foot occupancy 94.2 % 91.7 % 2.7 %

Annual contract rent per occupied

square foot (e) $ 17.99 $ 18.06 (0.4 )%

(a)

Revenues and cost of operations do not include tenant reinsurance and merchandise sales and expenses generated at the facilities.

(b)

Direct net operating income is a non-GAAP financial measure that excludes the impact of supervisory payroll, centralized management costs and stock based compensation in addition to depreciation and amortization expense. We utilize direct net operating income in evaluating property performance and in evaluating property operating trends as compared to our competitors.

(c)

See attached reconciliation of self-storage net operating income ("NOI") to net income.

(d)

Realized annual rent per occupied square foot is computed by dividing annualized rental income, before late charges and administrative fees, by the weighted average occupied square feet for the period. Realized annual rent per available square foot ("REVPAF") is computed by dividing annualized rental income, before late charges and administrative fees, by the total available rentable square feet for the period. These measures exclude late charges and administrative fees in order to provide a better measure of our ongoing level of revenue. Late charges are dependent upon the level of delinquency, and administrative fees are dependent upon the level of move-ins. In addition, the rates charged for late charges and administrative fees can vary independently from rental rates. These measures take into consideration promotional discounts, which reduce rental income.

(e)

Annual contract rent represents the agreed upon monthly rate that is paid by our tenants in place at the time of measurement. Contract rates are initially set in the lease agreement upon move-in and we adjust them from time to time with notice. Contract rent excludes other fees that are charged on a per-item basis, such as late charges and administrative fees, does not reflect the impact of promotional discounts, and does not reflect the impact of rents that are written off as uncollectible.

The following table summarizes selected quarterly financial data with respect to the Same Store Facilities (unaudited):

(a) Revenues and cost of operations do not include tenant reinsurance and merchandise sales and expenses generated at the facilities.

Direct net operating income is a non-GAAP financial measure that excludes the impact of supervisory payroll, centralized management costs and stock(b) based compensation in addition to depreciation and amortization expense. We utilize direct net operating income in evaluating property performance and in evaluating property operating trends as compared to our competitors.

(c) See attached reconciliation of self-storage net operating income ("NOI") to net income.

Realized annual rent per occupied square foot is computed by dividing annualized rental income, before late charges and administrative fees, by the weighted average occupied square feet for the period. Realized annual rent per available square foot ("REVPAF") is computed by dividing annualized rental income, before late charges and administrative fees, by the total available rentable square feet for the period. These measures(d) exclude late charges and administrative fees in order to provide a better measure of our ongoing level of revenue. Late charges are dependent upon the level of delinquency, and administrative fees are dependent upon the level of move-ins. In addition, the rates charged for late charges and administrative fees can vary independently from rental rates. These measures take into consideration promotional discounts, which reduce rental income.

Annual contract rent represents the agreed upon monthly rate that is paid by our tenants in place at the time of measurement. Contract rates are initially set in the lease agreement upon move-in and we adjust them from(e) time to time with notice. Contract rent excludes other fees that are charged on a per-item basis, such as late charges and administrative fees, does not reflect the impact of promotional discounts, and does not reflect the impact of rents that are written off as uncollectible.

The following table summarizes selected quarterly financial data with respect to the Same Store Facilities (unaudited):





For the Quarter Ended

March 31 June 30 September December 31 Entire Year 30



(Amounts in thousands, except for per square foot data)

Total revenues:

2020 $ 609,053 $ 596,896 $ 611,085 $ 619,512 $ 2,436,546

2019 $ 601,805 $ 615,564 $ 628,078 $ 614,782 $ 2,460,229



Total costof operations:

2020 $ 182,842 $ 185,862 $ 178,213 $ 140,911 $ 687,828

2019 $ 175,376 $ 173,911 $ 177,996 $ 142,480 $ 669,763



Property taxes:

2020 $ 70,097 $ 69,913 $ 69,072 $ 38,778 $ 247,860

2019 $ 66,744 $ 67,466 $ 67,272 $ 38,969 $ 240,451



Repairs andmaintenance, including

snow removal expenses:

2020 $ 12,381 $ 11,292 $ 12,579 $ 12,969 $ 49,221

2019 $ 13,745 $ 12,056 $ 13,154 $ 12,548 $ 51,503



Marketing:

2020 $ 14,275 $ 16,979 $ 15,572 $ 13,075 $ 59,901

2019 $ 8,981 $ 12,404 $ 14,319 $ 13,207 $ 48,911



REVPAF:

2020 $ 16.24 $ 16.13 $ 16.50 $ 16.72 $ 16.40

2019 $ 16.00 $ 16.41 $ 16.72 $ 16.38 $ 16.38



Weightedaverage realizedannual

rent peroccupied square foot:

2020 $ 17.44 $ 17.11 $ 17.27 $ 17.56 $ 17.34

2019 $ 17.31 $ 17.46 $ 17.75 $ 17.60 $ 17.53



Weightedaverage occupancylevels

for the period:

2020 93.1 % 94.3 % 95.5 % 95.2 % 94.5 %

2019 92.5 % 94.0 % 94.2 % 93.1 % 93.4 %



The following table sets forth selected market trends in our Same Store Facilities:



Same Store Facilities Operating Trends by Market (Unaudited)

Three Months Ended December Year Ended December 31, 31,

2020 2019 Change 2020 2019 Change

(Amounts in thousands, except for per square foot data)



Revenues:

Los Angeles $ 97,353 $ 95,413 2.0 % $ 381,535 $ 379,097 0.6 %

San Francisco 52,731 50,805 3.8 % 205,558 202,747 1.4 %

New York 39,321 39,238 0.2 % 154,538 157,029 (1.6 ) %

Seattle-Tacoma 28,935 28,723 0.7 % 114,606 114,774 (0.1 ) %

Washington DC 28,570 28,711 (0.5 ) 112,739 114,483 (1.5 ) % %

Miami 27,786 27,677 0.4 % 108,598 111,402 (2.5 ) %

Chicago 30,292 30,012 0.9 % 118,560 119,281 (0.6 ) %

Atlanta 21,077 21,612 (2.5 ) 83,511 87,518 (4.6 ) % %

Dallas-Ft. 20,955 21,150 (0.9 ) 83,162 84,988 (2.1 )Worth % %

Houston 17,791 18,141 (1.9 ) 70,975 73,683 (3.7 ) % %

Orlando-Daytona 15,306 15,701 (2.5 ) 60,772 62,869 (3.3 ) % %

Philadelphia 15,312 14,857 3.1 % 59,666 59,120 0.9 %

West Palm Beach 11,820 11,672 1.3 % 46,038 46,664 (1.3 ) %

Tampa 11,760 11,849 (0.8 ) 46,216 47,706 (3.1 ) % %

Charlotte 10,486 10,393 0.9 % 41,006 41,781 (1.9 ) %

All other 190,017 188,828 0.6 % 749,066 757,087 (1.1 )markets %

Total revenues $ 619,512 $ 614,782 0.8 % $ 2,436,546 $ 2,460,229 (1.0 ) %



Net operating income:

Los Angeles $ 81,416 $ 80,378 1.3 % $ 309,991 $ 311,049 (0.3 ) %

San Francisco 43,335 41,351 4.8 % 163,962 162,667 0.8 %

New York 31,321 30,932 1.3 % 108,681 111,424 (2.5 ) %

Seattle-Tacoma 23,085 23,808 (3.0 ) 86,874 89,440 (2.9 ) % %

Washington DC 22,759 22,456 1.3 % 82,415 84,704 (2.7 ) %

Miami 24,997 24,371 2.6 % 79,472 82,910 (4.1 ) %

Chicago 19,161 18,989 0.9 % 62,749 63,319 (0.9 ) %

Atlanta 16,502 16,767 (1.6 ) 59,940 64,423 (7.0 ) % %

Dallas-Ft. 17,003 16,693 1.9 % 56,020 58,192 (3.7 )Worth %

Houston 11,296 11,178 1.1 % 43,073 45,793 (5.9 ) %

Orlando-Daytona 11,853 12,115 (2.2 ) 42,568 45,282 (6.0 ) % %

Philadelphia 11,458 10,713 7.0 % 41,572 41,592 (0.0 ) %

West Palm Beach 8,779 8,650 1.5 % 32,752 34,125 (4.0 ) %

Tampa 8,984 9,039 (0.6 ) 31,290 33,421 (6.4 ) % %

Charlotte 7,739 7,383 4.8 % 29,509 30,104 (2.0 ) %

All other 138,913 137,479 1.0 % 517,850 532,021 (2.7 )markets %

Total net )operating $ 478,601 $ 472,302 1.3 % $ 1,748,718 $ 1,790,466 (2.3 %income

Same Store Facilities Operating Trends by Market (Continued)

Three Months Ended December 31,

Year Ended December 31,

2020

2019

Change

2020

2019

Change

Weighted average square foot

occupancy:

Los Angeles

97.7

%

95.3

%

2.5

%

96.7

%

95.2

%

1.6

%

San Francisco

97.7

%

93.7

%

4.3

%

96.1

%

94.3

%

1.9

%

New York

95.9

%

93.6

%

2.5

%

95.2

%

94.1

%

1.2

%

Seattle-Tacoma

94.4

%

92.2

%

2.4

%

94.1

%

93.0

%

1.2

%

Washington DC

95.2

%

92.5

%

2.9

%

94.4

%

93.4

%

1.1

%

Miami

96.2

%

93.1

%

3.3

%

94.4

%

93.0

%

1.5

%

Chicago

94.6

%

92.4

%

2.4

%

93.8

%

92.1

%

1.8

%

Atlanta

94.0

%

92.2

%

2.0

%

92.8

%

93.0

%

(0.2

)%

Dallas-Ft. Worth

93.2

%

91.8

%

1.5

%

92.9

%

92.1

%

0.9

%

Houston

92.9

%

91.2

%

1.9

%

92.1

%

90.1

%

2.2

%

Orlando-Daytona

94.7

%

93.4

%

1.4

%

94.4

%

94.2

%

0.2

%

Philadelphia

96.7

%

94.6

%

2.2

%

96.1

%

95.3

%

0.8

%

West Palm Beach

96.3

%

94.0

%

2.4

%

95.0

%

94.0

%

1.1

%

Tampa

94.8

%

92.3

%

2.7

%

93.4

%

92.6

%

0.9

%

Charlotte

94.5

%

91.7

%

3.1

%

93.0

%

91.9

%

1.2

%

All other markets

94.8

%

92.9

%

2.0

%

94.5

%

93.6

%

1.0

%

Total weighted average

square foot occupancy

95.2

%

93.1

%

2.3

%

94.5

%

93.4

%

1.2

%

Realized annual rent per

occupied square foot:

Los Angeles

$

26.20

$

26.02

0.7

%

$

25.88

$

25.86

0.1

%

San Francisco

26.97

26.85

0.4

%

26.64

26.62

0.1

%

New York

25.90

26.16

(1.0

)%

25.62

26.05

(1.7

)%

Seattle-Tacoma

20.56

20.65

(0.4

)%

20.33

20.42

(0.4

)%

Washington DC

21.32

21.72

(1.8

)%

21.11

21.45

(1.6

)%

Miami

19.91

20.18

(1.3

)%

19.77

20.36

(2.9

)%

Chicago

15.21

15.21

0.0

%

14.96

15.15

(1.3

)%

Atlanta

13.17

13.55

(2.8

)%

13.15

13.56

(3.0

)%

Dallas-Ft. Worth

13.46

13.60

(1.0

)%

13.36

13.63

(2.0

)%

Houston

12.71

13.00

(2.2

)%

12.75

13.39

(4.8

)%

Orlando-Daytona

13.62

13.97

(2.5

)%

13.54

13.89

(2.5

)%

Philadelphia

17.27

16.84

2.6

%

16.86

16.65

1.3

%

West Palm Beach

18.78

18.72

0.3

%

18.51

18.72

(1.1

)%

Tampa

13.78

14.04

(1.9

)%

13.70

14.10

(2.8

)%

Charlotte

11.16

11.27

(1.0

)%

11.07

11.29

(1.9

)%

All other markets

14.56

14.55

0.1

%

14.35

14.48

(0.9

)%

Total realized rent per

occupied square foot

$

17.56

$

17.60

(0.2

)%

$

17.34

$

17.53

(1.1

)%



Same Store Facilities Operating Trends by Market (Continued)



Three Months Ended December Year Ended December 31, 31,

2020 2019 Change 2020 2019 Change

Weighted average square foot

occupancy:

Los Angeles 97.7 % 95.3 % 2.5 % 96.7 % 95.2 % 1.6 %

San Francisco 97.7 % 93.7 % 4.3 % 96.1 % 94.3 % 1.9 %

New York 95.9 % 93.6 % 2.5 % 95.2 % 94.1 % 1.2 %

Seattle-Tacoma 94.4 % 92.2 % 2.4 % 94.1 % 93.0 % 1.2 %

Washington DC 95.2 % 92.5 % 2.9 % 94.4 % 93.4 % 1.1 %

Miami 96.2 % 93.1 % 3.3 % 94.4 % 93.0 % 1.5 %

Chicago 94.6 % 92.4 % 2.4 % 93.8 % 92.1 % 1.8 %

Atlanta 94.0 % 92.2 % 2.0 % 92.8 % 93.0 % (0.2 ) %

Dallas-Ft. Worth 93.2 % 91.8 % 1.5 % 92.9 % 92.1 % 0.9 %

Houston 92.9 % 91.2 % 1.9 % 92.1 % 90.1 % 2.2 %

Orlando-Daytona 94.7 % 93.4 % 1.4 % 94.4 % 94.2 % 0.2 %

Philadelphia 96.7 % 94.6 % 2.2 % 96.1 % 95.3 % 0.8 %

West Palm Beach 96.3 % 94.0 % 2.4 % 95.0 % 94.0 % 1.1 %

Tampa 94.8 % 92.3 % 2.7 % 93.4 % 92.6 % 0.9 %

Charlotte 94.5 % 91.7 % 3.1 % 93.0 % 91.9 % 1.2 %

All other markets 94.8 % 92.9 % 2.0 % 94.5 % 93.6 % 1.0 %

Total weighted average

square foot 95.2 % 93.1 % 2.3 % 94.5 % 93.4 % 1.2 %occupancy



Realized annual rent per

occupied square foot:

Los Angeles $ 26.20 $ 26.02 0.7 % $ 25.88 $ 25.86 0.1 %

San Francisco 26.97 26.85 0.4 % 26.64 26.62 0.1 %

New York 25.90 26.16 (1.0 ) 25.62 26.05 (1.7 ) % %

Seattle-Tacoma 20.56 20.65 (0.4 ) 20.33 20.42 (0.4 ) % %

Washington DC 21.32 21.72 (1.8 ) 21.11 21.45 (1.6 ) % %

Miami 19.91 20.18 (1.3 ) 19.77 20.36 (2.9 ) % %

Chicago 15.21 15.21 0.0 % 14.96 15.15 (1.3 ) %

Atlanta 13.17 13.55 (2.8 ) 13.15 13.56 (3.0 ) % %

Dallas-Ft. Worth 13.46 13.60 (1.0 ) 13.36 13.63 (2.0 ) % %

Houston 12.71 13.00 (2.2 ) 12.75 13.39 (4.8 ) % %

Orlando-Daytona 13.62 13.97 (2.5 ) 13.54 13.89 (2.5 ) % %

Philadelphia 17.27 16.84 2.6 % 16.86 16.65 1.3 %

West Palm Beach 18.78 18.72 0.3 % 18.51 18.72 (1.1 ) %

Tampa 13.78 14.04 (1.9 ) 13.70 14.10 (2.8 ) % %

Charlotte 11.16 11.27 (1.0 ) 11.07 11.29 (1.9 ) % %

All other markets 14.56 14.55 0.1 % 14.35 14.48 (0.9 ) %

Total realized rent per

occupied square foot $ 17.56 $ 17.60 (0.2 ) $ 17.34 $ 17.53 (1.1 ) % %

Same Store Facilities Operating Trends by Market (Continued)

Three Months Ended December 31,

Year Ended December 31,

2020

2019

Change

2020

2019

Change

REVPAF:

Los Angeles

$

25.59

$

24.81

3.1

%

$

25.02

$

24.62

1.6

%

San Francisco

26.35

25.17

4.7

%

25.61

25.09

2.1

%

New York

24.85

24.50

1.4

%

24.39

24.50

(0.4

)%

Seattle-Tacoma

19.40

19.04

1.9

%

19.13

18.99

0.7

%

Washington DC

20.29

20.09

1.0

%

19.93

20.03

(0.5

)%

Miami

19.14

18.79

1.9

%

18.66

18.93

(1.4

)%

Chicago

14.39

14.05

2.4

%

14.04

13.95

0.6

%

Atlanta

12.38

12.49

(0.9

)%

12.20

12.62

(3.3

)%

Dallas-Ft. Worth

12.54

12.49

0.4

%

12.41

12.55

(1.1

)%

Houston

11.81

11.86

(0.4

)%

11.75

12.06

(2.6

)%

Orlando-Daytona

12.90

13.05

(1.1

)%

12.78

13.08

(2.3

)%

Philadelphia

16.70

15.94

4.8

%

16.20

15.86

2.1

%

West Palm Beach

18.08

17.59

2.8

%

17.59

17.59

0.0

%

Tampa

13.05

12.96

0.7

%

12.80

13.06

(2.0

)%

Charlotte

10.55

10.33

2.1

%

10.29

10.38

(0.9

)%

All other markets

13.80

13.53

2.0

%

13.57

13.55

0.1

%

Total REVPAF

$

16.72

$

16.38

2.1

%

$

16.40

$

16.38

0.1

%

Property Operations - Non-Same Store Facilities

In addition to our Same Store Facilities, at December 31, 2020 we had 327 facilities that were not stabilized with respect to occupancies or rental rates since January 1, 2018 or that we did not own as of January 1, 2018. The following table summarizes operating data with respect to these 327 facilities (unaudited). Additional data and metrics with respect to these facilities is included in the MD&A in our December 31, 2020 Form 10-K.



Same Store FacilitiesOperating Trends by Market (Continued)



Three Months Ended Year Ended December 31, December 31,

2020 2019 Change 2020 2019 Change

REVPAF:

Los Angeles $ 25.59 $ 24.81 3.1 % $ 25.02 $ 24.62 1.6 %

San Francisco 26.35 25.17 4.7 % 25.61 25.09 2.1 %

New York 24.85 24.50 1.4 % 24.39 24.50 (0.4 ) %

Seattle-Tacoma 19.40 19.04 1.9 % 19.13 18.99 0.7 %

Washington DC 20.29 20.09 1.0 % 19.93 20.03 (0.5 ) %

Miami 19.14 18.79 1.9 % 18.66 18.93 (1.4 ) %

Chicago 14.39 14.05 2.4 % 14.04 13.95 0.6 %

Atlanta 12.38 12.49 (0.9 ) 12.20 12.62 (3.3 ) % %

Dallas-Ft. Worth 12.54 12.49 0.4 % 12.41 12.55 (1.1 ) %

Houston 11.81 11.86 (0.4 ) 11.75 12.06 (2.6 ) % %

Orlando-Daytona 12.90 13.05 (1.1 ) 12.78 13.08 (2.3 ) % %

Philadelphia 16.70 15.94 4.8 % 16.20 15.86 2.1 %

West Palm Beach 18.08 17.59 2.8 % 17.59 17.59 0.0 %

Tampa 13.05 12.96 0.7 % 12.80 13.06 (2.0 ) %

Charlotte 10.55 10.33 2.1 % 10.29 10.38 (0.9 ) %

All other markets 13.80 13.53 2.0 % 13.57 13.55 0.1 %

Total REVPAF $ 16.72 $ 16.38 2.1 % $ 16.40 $ 16.38 0.1 %

Property Operations - Non-Same Store Facilities

In addition to our Same Store Facilities, at December 31, 2020 we had 327 facilities that were not stabilized with respect to occupancies or rental rates since January 1, 2018 or that we did not own as of January 1, 2018. The following table summarizes operating data with respect to these 327 facilities (unaudited). Additional data and metrics with respect to these facilities is included in the MD&A in our December 31, 2020 Form 10-K.



NON-SAME Three Months Ended December 31, Year ended December 31,STORE

FACILITIES 2020 2019 Change 2020 2019 Change

(Dollar amounts in thousands, except for per square foot data)

Revenues:

Acquired Facilities:

2018 $ 4,450 $ 4,143 $ 307 $ 17,119 $ 16,029 $ 1,090 Acquisitions

2019 8,599 5,861 2,738 31,334 12,704 18,630 Acquisitions

2020 5,997 - 5,997 11,365 - 11,365 Acquisitions

19,046 10,004 9,042 59,818 28,733 31,085



Developed andexpanded facilities:

Developed in 4,722 4,539 183 18,228 17,630 598 2015

Developed in 19,010 15,873 3,137 70,180 56,868 13,312 2016 - 2018

Developed in 2,106 849 1,257 6,455 1,720 4,735 2019

Developed in 215 - 215 301 - 301 2020

Expansionscompleted 9,052 7,891 1,161 33,921 29,354 4,567 before 2019

Expansionscompleted in 10,030 8,022 2,008 36,031 28,898 7,133 2019 or 2020

Expansions in 3,792 4,081 (289 ) 15,648 16,573 (925 )process

48,927 41,255 7,672 180,764 151,043 29,721



Othernon-same 11,453 10,986 467 44,502 44,547 (45 )storefacilities

Total 79,426 62,245 17,181 285,084 224,323 60,761 revenues



Cost ofoperations before

depreciationand amortization:

Acquired Facilities:

2018 1,811 1,644 167 7,562 7,278 284 Acquisitions

2019 3,364 2,300 1,064 13,323 5,178 8,145 Acquisitions

2020 3,072 - 3,072 6,742 - 6,742 Acquisitions

8,247 3,944 4,303 27,627 12,456 15,171



Developed andexpanded facilities:

Developed in 1,172 1,223 (51 ) 5,720 5,842 (122 )2015

Developed in 6,467 5,887 580 29,728 27,694 2,034 2016 - 2018

Developed in 1,139 637 502 4,685 1,915 2,770 2019

Developed in 173 - 173 383 - 383 2020

Expansionscompleted 2,718 2,352 366 11,492 10,462 1,030 before 2019

Expansionscompleted in 4,658 3,734 924 19,372 14,571 4,801 2019 or 2020

Expansions in 1,079 894 185 4,262 3,828 434 process

17,406 14,727 2,679 75,642 64,312 11,330



Othernon-same 3,750 3,768 (18 ) 16,446 15,885 561 storefacilities

Total cost of 29,403 22,439 6,964 119,715 92,653 27,062 operations

NON-SAME STORE

Three Months Ended December 31,

Year ended December 31,

FACILITIES (continued)

2020

2019

Change

2020

2019

Change

Net operating income:

Acquired Facilities:

2018 Acquisitions

$

2,639

$

2,499

$

140

$

9,557

$

8,751

$

806

2019 Acquisitions

5,235

3,561

1,674

18,011

7,526

10,485

2020 Acquisitions

2,925

-

2,925

4,623

-

4,623

10,799

6,060

4,739

32,191

16,277

15,914

Developed and expanded facilities:

Developed in 2015

3,550

3,316

234

12,508

11,788

720

Developed in 2016 - 2018

12,543

9,986

2,557

40,452

29,174

11,278

Developed in 2019

967

212

755

1,770

(195

)

1,965

Developed in 2020

42

-

42

(82

)

-

(82

)

Expansions completed before 2019

6,334

5,539

795

22,429

18,892

3,537

Expansions completed in 2019 or 2020

5,372

4,288

1,084

16,659

14,327

2,332

Expansions in process

2,713

3,187

(474

)

11,386

12,745

(1,359

)

31,521

26,528

4,993

105,122

86,731

18,391

Other non-same store facilities

7,703

7,218

485

28,056

28,662

(606

)

Net operating income (a)

$

50,023

$

39,806

$

10,217

$

165,369

$

131,670

$

33,699



NON-SAME Three Months Ended December 31, Year ended December 31,STORE

FACILITIES 2020 2019 Change 2020 2019 Change(continued)



Netoperating income:

Acquired Facilities:

2018 $ 2,639 $ 2,499 $ 140 $ 9,557 $ 8,751 $ 806 Acquisitions

2019 5,235 3,561 1,674 18,011 7,526 10,485 Acquisitions

2020 2,925 - 2,925 4,623 - 4,623 Acquisitions

10,799 6,060 4,739 32,191 16,277 15,914



Developedand expanded facilities:

Developed in 3,550 3,316 234 12,508 11,788 720 2015

Developed in 12,543 9,986 2,557 40,452 29,174 11,278 2016 - 2018

Developed in 967 212 755 1,770 (195 ) 1,965 2019

Developed in 42 - 42 (82 ) - (82 )2020

Expansionscompleted 6,334 5,539 795 22,429 18,892 3,537 before 2019

Expansionscompleted in 5,372 4,288 1,084 16,659 14,327 2,332 2019 or 2020

Expansions 2,713 3,187 (474 ) 11,386 12,745 (1,359 )in process

31,521 26,528 4,993 105,122 86,731 18,391



Othernon-same 7,703 7,218 485 28,056 28,662 (606 )storefacilities

Netoperating $ 50,023 $ 39,806 $ 10,217 $ 165,369 $ 131,670 $ 33,699 income (a)



(a)

See attached reconciliation of self-storage NOI to net income.

Investing and Capital Activities

During the three months ended December 31, 2020, we acquired 43 self-storage facilities (five each in Michigan and Pennsylvania, four each in Alabama, Illinois and Texas, three each in Georgia and Missouri, two each in Arizona, Colorado, Florida, Minnesota and Ohio and one each in Maryland, Nevada, Oklahoma, Oregon and Washington) with 3.7 million net rentable square feet for $513.7 million. During 2020, we acquired 62 self-storage facilities (six in Ohio, five each in Michigan and Pennsylvania, four each in Alabama, Illinois, Minnesota and Texas, three each in California, Colorado, Florida, Georgia and Missouri, two each in Arizona, New York and Tennessee and one each in Indiana, Massachusetts, Maryland, Nebraska, Nevada, Oklahoma, Oregon, Utah and Washington) with 5.1 million net rentable square feet for $796.1 million.

Subsequent to December 31, 2020, we acquired or were under contract to acquire 40 self-storage facilities across 18 states with 3.5 million net rentable square feet, for $580.1 million.

During the three months ended December 31, 2020, we opened one newly developed facility and various expansion projects (0.4 million net rentable square feet - 0.2 million in Missouri and 0.1 million each in Florida and Texas) costing $41.3 million. During 2020, we opened three newly developed facilities and various expansion projects (1.1 million net rentable square feet - 0.5 million in Florida, 0.2 million each in Minnesota and Missouri and 0.1 million each in California and Texas) costing $138.7 million. At December 31, 2020, we had various facilities in development (1.4 million net rentable square feet) estimated to cost $235 million and various expansion projects (2.2 million net rentable square feet) estimated to cost $326 million. Our aggregate 3.6 million net rentable square foot pipeline of development and expansion facilities includes 1.3 million in California, 1.0 million in Florida, 0.2 million each in New York, Texas, Virginia and Washington and 0.5 million in other states. The remaining $373 million of development costs for these projects is expected to be incurred primarily in the next 18 to 24 months.

On October 6, 2020, we issued our 3.875% Series N Preferred Shares for gross proceeds of $283 million.

On November 9, 2020, we issued our 3.9% Series O Preferred Shares for gross proceeds of $170 million.

On January 19, 2021, we completed a public offering of $500 million Senior Unsecured Notes bearing interest at a fixed rate of 0.875% and maturing on February 15, 2026.

On January 20, 2021, we redeemed our 5.40% Series B Preferred Shares for $300 million. We called these shares for redemption in December 2020 and classified the liquidation amount as a liability on our balance sheet at December 31, 2020.

Distributions Declared

On February 16, 2021, our Board of Trustees declared a regular common quarterly dividend of $2.00 per common share. The Board also declared dividends with respect to our various series of preferred shares. All the dividends are payable on March 31, 2021 to shareholders of record as of March 16, 2021.

Fourth Quarter Conference Call

A conference call is scheduled for February 25, 2021 at 9:00 a.m. (PST) to discuss the fourth quarter earnings results. The domestic dial-in number is (866) 406-5408, and the international dial-in number is (973) 582-2770 (conference ID number for either domestic or international is 8057778). A simultaneous audio webcast may be accessed by using the link at www.publicstorage.com under "About Us, Investor Relations, News and Events, Events Calendar." A replay of the conference call may be accessed through March 11, 2021 by calling (800) 585-8367 (domestic), (404) 537-3406 (international) or by using the link at www.publicstorage.com under "About Us, Investor Relations, News and Events, Events Calendar." All forms of replay utilize conference ID number 8057778.

About Public Storage

Public Storage, a member of the S&P 500 and FT Global 500, is a REIT that primarily acquires, develops, owns and operates self-storage facilities. At December 31, 2020, we had: (i) interests in 2,548 self-storage facilities located in 38 states with approximately 175 million net rentable square feet in the United States, (ii) an approximate 35% common equity interest in Shurgard Self Storage SA (Euronext Brussels:SHUR) which owned 241 self-storage facilities located in seven Western European nations with approximately 13 million net rentable square feet operated under the "Shurgard" brand and (iii) an approximate 42% common equity interest in PS Business Parks, Inc. (NYSE:PSB) which owned and operated approximately 28 million rentable square feet of commercial space at December 31, 2020. Our headquarters are located in Glendale, California.

This press release, our Form 10-K for the year ended December 31, 2020, a financial supplement, and additional information about Public Storage is available on our website, www.publicstorage.com.

We expect to release our 2020 Annual Report on Form 10-K within approximately one business day.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this press release, other than statements of historical fact, are forward-looking statements which may be identified by the use of the words "expects," "believes," "anticipates," "should," "estimates" and similar expressions. These forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Factors and risks that may impact future results and performance include, but are not limited to, those described in Part 1, Item 1A, "Risk Factors" in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on February 25, 2020 and in our other filings with the SEC including: general risks associated with the ownership and operation of real estate, including changes in demand, risk related to development, expansion and acquisition of self-storage facilities, potential liability for environmental contamination, natural disasters and adverse changes in laws and regulations governing property tax, real estate and zoning; risks associated with downturns in the national and local economies in the markets in which we operate, including risks related to current economic conditions and the economic health of our customers; risks associated with the COVID Pandemic or similar events, including but not limited to illness or death of our employees or customers, negative impacts to the economic environment and to self-storage customers which could reduce the demand for self-storage or reduce our ability to collect rent, and/or potential regulatory actions to (i) close our facilities if we were determined not to be an "essential business" or for other reasons, (ii) limit our ability to increase rent or otherwise limit the rent we can charge or (iii) limit our ability to collect rent or evict delinquent tenants; the risk that there could be an out-migration of population from certain high-cost major markets, if it is determined that the ability to "work from home," which has become more prominent during the COVID Pandemic, could allow certain workers to live in less expensive localities, which could negatively impact the occupancies and revenues of our properties in such major high-cost markets; risk that even though many initial restrictions due to the COVID Pandemic have eased, they could be reinstituted in response to increases in infections or if additional pandemics occur; risk that we could experience a change in the move-out patterns of our long-term customers due to economic uncertainty and the significant increase in unemployment resulting from the COVID Pandemic. This could lead to lower occupancies and rent "roll down" as long-term customers are replaced with new customers at lower rates; risk of negative impacts on the cost and availability of debt and equity capital as a result of the COVID Pandemic, which could have a material impact upon our capital and growth plans; the impact of competition from new and existing self-storage and commercial facilities and other storage alternatives; the risk that our existing self-storage facilities may be at a disadvantage in competing with newly developed facilities with more visual and customer appeal; risks related to increased reliance on Google as a customer acquisition channel; difficulties in our ability to successfully evaluate, finance, integrate into our existing operations and manage properties that we acquire directly or through the acquisition of entities that own and operate self-storage facilities; risks associated with international operations including, but not limited to, unfavorable foreign currency rate fluctuations, changes in tax laws and local and global economic uncertainty that could adversely affect our earnings and cash flows; risks related to our participation in joint ventures; the impact of the legal and regulatory environment, as well as national, state and local laws and regulations including, without limitation, those governing environmental issues, taxes, our tenant reinsurance business, and labor, including risks related to the impact of new laws and regulations; risks of increased tax expense associated either with a possible failure by us to qualify as a REIT, or with challenges to the determination of taxable income for our taxable REIT subsidiaries; risks due to ballot initiatives or other actions that could remove the protections of Proposition 13 with respect to our real estate and result in substantial increases in our assessed values and property tax bills in California; changes in United States federal or state tax laws related to the taxation of REITs and other corporations; security breaches or a failure of our networks, systems or technology could adversely impact our operations or our business, customer and employee relationships or result in fraudulent payments; risks associated with the self-insurance of certain business risks, including property and casualty insurance, employee health insurance and workers compensation liabilities; difficulties in raising capital at a reasonable cost; delays and cost overruns on our projects to develop new facilities or expand our existing facilities; ongoing litigation and other legal and regulatory actions which may divert management's time and attention, require us to pay damages and expenses or restrict the operation of our business; and economic uncertainty due to the impact of war or terrorism. These forward-looking statements speak only as of the date of this press release. All of our forward-looking statements, including those in this press release, are qualified in their entirety by this statement. We expressly disclaim any obligation to update publicly or otherwise revise any forward-looking statements, whether because of new information, new estimates, or other factors, events or circumstances after the date of these forward-looking statements, except when expressly required by law. Given these risks and uncertainties, you should not rely on any forward-looking statements in this press release, or which management may make orally or in writing from time to time, neither as predictions of future events nor guarantees of future performance.

(a) See attached reconciliation of self-storage NOI to net income.

Investing and Capital Activities

During the three months ended December 31, 2020, we acquired 43 self-storage facilities (five each in Michigan and Pennsylvania, four each in Alabama, Illinois and Texas, three each in Georgia and Missouri, two each in Arizona, Colorado, Florida, Minnesota and Ohio and one each in Maryland, Nevada, Oklahoma, Oregon and Washington) with 3.7 million net rentable square feet for $513.7 million. During 2020, we acquired 62 self-storage facilities (six in Ohio, five each in Michigan and Pennsylvania, four each in Alabama, Illinois, Minnesota and Texas, three each in California, Colorado, Florida, Georgia and Missouri, two each in Arizona, New York and Tennessee and one each in Indiana, Massachusetts, Maryland, Nebraska, Nevada, Oklahoma, Oregon, Utah and Washington) with 5.1 million net rentable square feet for $796.1 million.

Subsequent to December 31, 2020, we acquired or were under contract to acquire 40 self-storage facilities across 18 states with 3.5 million net rentable square feet, for $580.1 million.

During the three months ended December 31, 2020, we opened one newly developed facility and various expansion projects (0.4 million net rentable square feet - 0.2 million in Missouri and 0.1 million each in Florida and Texas) costing $41.3 million. During 2020, we opened three newly developed facilities and various expansion projects (1.1 million net rentable square feet - 0.5 million in Florida, 0.2 million each in Minnesota and Missouri and 0.1 million each in California and Texas) costing $138.7 million. At December 31, 2020, we had various facilities in development (1.4 million net rentable square feet) estimated to cost $235 million and various expansion projects (2.2 million net rentable square feet) estimated to cost $326 million. Our aggregate 3.6 million net rentable square foot pipeline of development and expansion facilities includes 1.3 million in California, 1.0 million in Florida, 0.2 million each in New York, Texas, Virginia and Washington and 0.5 million in other states. The remaining $373 million of development costs for these projects is expected to be incurred primarily in the next 18 to 24 months.

On October 6, 2020, we issued our 3.875% Series N Preferred Shares for gross proceeds of $283 million.

On November 9, 2020, we issued our 3.9% Series O Preferred Shares for gross proceeds of $170 million.

On January 19, 2021, we completed a public offering of $500 million Senior Unsecured Notes bearing interest at a fixed rate of 0.875% and maturing on February 15, 2026.

On January 20, 2021, we redeemed our 5.40% Series B Preferred Shares for $300 million. We called these shares for redemption in December 2020 and classified the liquidation amount as a liability on our balance sheet at December 31, 2020.

Distributions Declared

On February 16, 2021, our Board of Trustees declared a regular common quarterly dividend of $2.00 per common share. The Board also declared dividends with respect to our various series of preferred shares. All the dividends are payable on March 31, 2021 to shareholders of record as of March 16, 2021.

Fourth Quarter Conference Call

A conference call is scheduled for February 25, 2021 at 9:00 a.m. (PST) to discuss the fourth quarter earnings results. The domestic dial-in number is (866) 406-5408, and the international dial-in number is (973) 582-2770 (conference ID number for either domestic or international is 8057778). A simultaneous audio webcast may be accessed by using the link at www.publicstorage.com under "About Us, Investor Relations, News and Events, Events Calendar." A replay of the conference call may be accessed through March 11, 2021 by calling (800) 585-8367 (domestic), (404) 537-3406 (international) or by using the link at www.publicstorage.com under "About Us, Investor Relations, News and Events, Events Calendar." All forms of replay utilize conference ID number 8057778.

About Public Storage

Public Storage, a member of the S&P 500 and FT Global 500, is a REIT that primarily acquires, develops, owns and operates self-storage facilities. At December 31, 2020, we had: (i) interests in 2,548 self-storage facilities located in 38 states with approximately 175 million net rentable square feet in the United States, (ii) an approximate 35% common equity interest in Shurgard Self Storage SA (Euronext Brussels:SHUR) which owned 241 self-storage facilities located in seven Western European nations with approximately 13 million net rentable square feet operated under the "Shurgard" brand and (iii) an approximate 42% common equity interest in PS Business Parks, Inc. (NYSE:PSB) which owned and operated approximately 28 million rentable square feet of commercial space at December 31, 2020. Our headquarters are located in Glendale, California.

This press release, our Form 10-K for the year ended December 31, 2020, a financial supplement, and additional information about Public Storage is available on our website, www.publicstorage.com.

We expect to release our 2020 Annual Report on Form 10-K within approximately one business day.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this press release, other than statements of historical fact, are forward-looking statements which may be identified by the use of the words "expects," "believes," "anticipates," "should," "estimates" and similar expressions. These forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Factors and risks that may impact future results and performance include, but are not limited to, those described in Part 1, Item 1A, "Risk Factors" in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the "SEC") on February 25, 2020 and in our other filings with the SEC including: general risks associated with the ownership and operation of real estate, including changes in demand, risk related to development, expansion and acquisition of self-storage facilities, potential liability for environmental contamination, natural disasters and adverse changes in laws and regulations governing property tax, real estate and zoning; risks associated with downturns in the national and local economies in the markets in which we operate, including risks related to current economic conditions and the economic health of our customers; risks associated with the COVID Pandemic or similar events, including but not limited to illness or death of our employees or customers, negative impacts to the economic environment and to self-storage customers which could reduce the demand for self-storage or reduce our ability to collect rent, and/or potential regulatory actions to (i) close our facilities if we were determined not to be an "essential business" or for other reasons, (ii) limit our ability to increase rent or otherwise limit the rent we can charge or (iii) limit our ability to collect rent or evict delinquent tenants; the risk that there could be an out-migration of population from certain high-cost major markets, if it is determined that the ability to "work from home," which has become more prominent during the COVID Pandemic, could allow certain workers to live in less expensive localities, which could negatively impact the occupancies and revenues of our properties in such major high-cost markets; risk that even though many initial restrictions due to the COVID Pandemic have eased, they could be reinstituted in response to increases in infections or if additional pandemics occur; risk that we could experience a change in the move-out patterns of our long-term customers due to economic uncertainty and the significant increase in unemployment resulting from the COVID Pandemic. This could lead to lower occupancies and rent "roll down" as long-term customers are replaced with new customers at lower rates; risk of negative impacts on the cost and availability of debt and equity capital as a result of the COVID Pandemic, which could have a material impact upon our capital and growth plans; the impact of competition from new and existing self-storage and commercial facilities and other storage alternatives; the risk that our existing self-storage facilities may be at a disadvantage in competing with newly developed facilities with more visual and customer appeal; risks related to increased reliance on Google as a customer acquisition channel; difficulties in our ability to successfully evaluate, finance, integrate into our existing operations and manage properties that we acquire directly or through the acquisition of entities that own and operate self-storage facilities; risks associated with international operations including, but not limited to, unfavorable foreign currency rate fluctuations, changes in tax laws and local and global economic uncertainty that could adversely affect our earnings and cash flows; risks related to our participation in joint ventures; the impact of the legal and regulatory environment, as well as national, state and local laws and regulations including, without limitation, those governing environmental issues, taxes, our tenant reinsurance business, and labor, including risks related to the impact of new laws and regulations; risks of increased tax expense associated either with a possible failure by us to qualify as a REIT, or with challenges to the determination of taxable income for our taxable REIT subsidiaries; risks due to ballot initiatives or other actions that could remove the protections of Proposition 13 with respect to our real estate and result in substantial increases in our assessed values and property tax bills in California; changes in United States federal or state tax laws related to the taxation of REITs and other corporations; security breaches or a failure of our networks, systems or technology could adversely impact our operations or our business, customer and employee relationships or result in fraudulent payments; risks associated with the self-insurance of certain business risks, including property and casualty insurance, employee health insurance and workers compensation liabilities; difficulties in raising capital at a reasonable cost; delays and cost overruns on our projects to develop new facilities or expand our existing facilities; ongoing litigation and other legal and regulatory actions which may divert management's time and attention, require us to pay damages and expenses or restrict the operation of our business; and economic uncertainty due to the impact of war or terrorism. These forward-looking statements speak only as of the date of this press release. All of our forward-looking statements, including those in this press release, are qualified in their entirety by this statement. We expressly disclaim any obligation to update publicly or otherwise revise any forward-looking statements, whether because of new information, new estimates, or other factors, events or circumstances after the date of these forward-looking statements, except when expressly required by law. Given these risks and uncertainties, you should not rely on any forward-looking statements in this press release, or which management may make orally or in writing from time to time, neither as predictions of future events nor guarantees of future performance.

PUBLIC STORAGE

SELECTED INCOME STATEMENT DATA

(Amounts in thousands, except per share data)

(Unaudited)



Three Months Ended Year Ended

December 31, December 31,

2020 2019 2020 2019



Revenues:

Self-storage $ 698,938 $ 677,027 $ 2,721,630 $ 2,684,552 facilities

Ancillary 49,598 42,965 193,438 170,556 operations

748,536 719,992 2,915,068 2,855,108



Expenses:

Self-storage cost 170,314 164,919 807,543 762,416 of operations

Ancillary cost of 15,838 12,215 59,919 50,736 operations

Depreciation and 141,406 134,885 553,257 512,918 amortization

General and 30,140 17,855 83,199 62,146 administrative

Interest expense 14,235 12,647 56,283 45,641

371,933 342,521 1,560,201 1,433,857



Other increases(decreases) to net income:

Interest and other 3,522 6,028 22,323 26,683 income

Equity in earningsof unconsolidated 17,634 13,916 80,497 69,547 real estateentities

Gain on sale of 376 - 1,493 341 real estate

Foreign currencyexchange (loss) (45,703 ) (10,318 ) (97,953 ) 7,829 gain

Net income 352,432 387,097 1,361,227 1,525,651

Allocation tononcontrolling (1,165 ) (1,082 ) (4,014 ) (5,117 )interests

Net incomeallocable to Public 351,267 386,015 1,357,213 1,520,534 Storageshareholders

Allocation of net income to:

Preferredshareholders - (48,219 ) (51,614 ) (207,068 ) (210,179 )distributions

Preferredshareholders - (9,883 ) (6,153 ) (48,265 ) (32,693 )redemptions

Restricted share (999 ) (997 ) (3,545 ) (4,895 )units

Net incomeallocable to common $ 292,166 $ 327,251 $ 1,098,335 $ 1,272,767 shareholders



Per common share:

Net income percommon share - $ 1.67 $ 1.88 $ 6.29 $ 7.30 Basic

Net income percommon share - $ 1.67 $ 1.87 $ 6.29 $ 7.29 Diluted

Weighted averagecommon shares - 174,532 174,383 174,494 174,287 Basic

Weighted averagecommon shares - 174,749 174,590 174,642 174,530 Diluted

PUBLIC STORAGE

SELECTED BALANCE SHEET DATA

(Amounts in thousands, except share and per share data)

December 31, 2020

December 31, 2019

ASSETS

(Unaudited)

Cash and equivalents

$

257,560

$

409,743

Operating real estate facilities:

Land and buildings, at cost

17,372,627

16,289,146

Accumulated depreciation

(7,152,135

)

(6,623,475

)

10,220,492

9,665,671

Construction in process

188,079

141,934

Investments in unconsolidated real estate entities

773,046

767,816

Goodwill and other intangible assets, net

204,654

205,936

Other assets

172,715

174,344

Total assets

$

11,816,546

$

11,365,444

LIABILITIES AND EQUITY

Senior unsecured notes

$

2,519,762

$

1,875,218

Mortgage notes

25,230

27,275

Preferred shares called for redemption

300,000

-

Accrued and other liabilities

394,655

383,284

Total liabilities

3,239,647

2,285,777

Equity:

Public Storage shareholders' equity:

Cumulative Preferred Shares, $0.01 par value, 100,000,000 shares

authorized, 151,700 shares issued (in series) and outstanding,

(162,600 at December 31, 2019) at liquidation preference

3,792,500

4,065,000

Common Shares, $0.10 par value, 650,000,000 shares authorized,

174,581,742 shares issued and outstanding, (174,418,615 shares

at December 31, 2019)

17,458

17,442

Paid-in capital

5,707,101

5,710,934

Accumulated deficit

(914,791

)

(665,575

)

Accumulated other comprehensive loss

(43,401

)

(64,890

)

Total Public Storage shareholders' equity

8,558,867

9,062,911

Noncontrolling interests

18,032

16,756

Total equity

8,576,899

9,079,667

Total liabilities and equity

$

11,816,546

$

11,365,444

PUBLIC STORAGE

SELECTED BALANCE SHEET DATA

(Amounts in thousands, except share and per share data)



December 31, December 31, 2020 2019

ASSETS (Unaudited)



Cash and equivalents $ 257,560 $ 409,743



Operating real estate facilities:

Land and buildings, at cost 17,372,627 16,289,146

Accumulated depreciation (7,152,135 ) (6,623,475 )

10,220,492 9,665,671

Construction in process 188,079 141,934

Investments in unconsolidated real estate 773,046 767,816 entities

Goodwill and other intangible assets, net 204,654 205,936

Other assets 172,715 174,344

Total assets $ 11,816,546 $ 11,365,444







LIABILITIES AND EQUITY



Senior unsecured notes $ 2,519,762 $ 1,875,218

Mortgage notes 25,230 27,275

Preferred shares called for redemption 300,000 -

Accrued and other liabilities 394,655 383,284

Total liabilities 3,239,647 2,285,777



Equity:

Public Storage shareholders' equity:

Cumulative Preferred Shares, $0.01 par value, 100,000,000 shares

authorized, 151,700 shares issued (in series) and outstanding,

(162,600 at December 31, 2019) at liquidation 3,792,500 4,065,000 preference

Common Shares, $0.10 par value, 650,000,000 shares authorized,

174,581,742 shares issued and outstanding, (174,418,615 shares

at December 31, 2019) 17,458 17,442

Paid-in capital 5,707,101 5,710,934

Accumulated deficit (914,791 ) (665,575 )

Accumulated other comprehensive loss (43,401 ) (64,890 )

Total Public Storage shareholders' equity 8,558,867 9,062,911

Noncontrolling interests 18,032 16,756

Total equity 8,576,899 9,079,667

Total liabilities and equity $ 11,816,546 $ 11,365,444

PUBLIC STORAGE

SELECTED FINANCIAL DATA

Computation of Funds from Operations and Funds Available for Distribution

(Unaudited - amounts in thousands except per share data)

Three Months Ended

Year Ended

December 31,

December 31,

2020

2019

2020

2019

Computation of FFO per Share:

Net income allocable to common shareholders

$

292,166

$

327,251

$

1,098,335

$

1,272,767

Eliminate items excluded from FFO:

Depreciation and amortization

140,491

133,897

549,975

511,413

Depreciation from unconsolidated real estate investments

18,074

19,161

70,681

71,725

Depreciation allocated to noncontrolling interests

and restricted share unitholders

(997

)

(903

)

(3,850

)

(4,208

)

Gains on sale of real estate, including equity

investment share

(376

)

(4,516

)

(12,791

)

(5,896

)

FFO allocable to common shares (a)

$

449,358

$

474,890

$

1,702,350

$

1,845,801

Diluted weighted average common shares

174,749

174,590

174,642

174,530

FFO per share (a)

$

2.57

$

2.72

$

9.75

$

10.58

Reconciliation of Earnings per Share to FFO per Share:

Diluted earnings per share

$

1.67

$

1.87

$

6.29

$

7.29

Eliminate per share amounts excluded from FFO:

Depreciation and amortization

0.90

0.87

3.53

3.32

Gains on sale of real estate

-

(0.02

)

(0.07

)

(0.03

)

FFO per share (a)

$

2.57

$

2.72

$

9.75

$

10.58

Computation of Funds Available for Distribution ("FAD"):

FFO allocable to common shares

$

449,358

$

474,890

$

1,702,350

$

1,845,801

Eliminate effect of items included in FFO but not FAD:

Share-based compensation expense in excess of cash paid

11,014

4,866

22,845

13,671

Foreign currency exchange loss (gain)

45,703

10,318

97,953

(7,829

)

Impact of EITF D-42, including equity investment share

9,883

10,706

48,265

37,246

Less: Capital expenditures to maintain real estate facilities

(37,764

)

(57,140

)

(163,834

)

(192,539

)

FAD (a)

$

478,194

$

443,640

$

1,707,579

$

1,696,350

Distributions paid to common shareholders and restricted

share units

$

349,889

$

349,754

$

1,399,361

$

1,398,570

Distribution payout ratio

73.2

%

78.8

%

82.0

%

82.4

%

Distributions per common share

$

2.00

$

2.00

$

8.00

$

8.00

PUBLIC STORAGE

SELECTED FINANCIAL DATA



Computation of Funds from Operations and Funds Available for Distribution

(Unaudited - amounts in thousands except per share data)



Three Months Ended Year Ended

December 31, December 31,

2020 2019 2020 2019



Computation of FFO per Share:



Net incomeallocable to common $ 292,166 $ 327,251 $ 1,098,335 $ 1,272,767 shareholders

Eliminate items excluded from FFO:

Depreciation and 140,491 133,897 549,975 511,413 amortization

Depreciation fromunconsolidated real 18,074 19,161 70,681 71,725 estate investments

Depreciationallocated to noncontrollinginterests

and restricted (997 ) (903 ) (3,850 ) (4,208 )share unitholders

Gains on sale ofreal estate, including equity

investment share (376 ) (4,516 ) (12,791 ) (5,896 )

FFO allocable to $ 449,358 $ 474,890 $ 1,702,350 $ 1,845,801 common shares (a)

Diluted weightedaverage common 174,749 174,590 174,642 174,530 shares

FFO per share (a) $ 2.57 $ 2.72 $ 9.75 $ 10.58



Reconciliation ofEarnings per Share to FFO per Share:



Diluted earnings $ 1.67 $ 1.87 $ 6.29 $ 7.29 per share

Eliminate per shareamounts excluded from FFO:

Depreciation and 0.90 0.87 3.53 3.32 amortization

Gains on sale of - (0.02 ) (0.07 ) (0.03 )real estate

FFO per share (a) $ 2.57 $ 2.72 $ 9.75 $ 10.58



Computation ofFunds Available for Distribution("FAD"):



FFO allocable to $ 449,358 $ 474,890 $ 1,702,350 $ 1,845,801 common shares

Eliminate effect ofitems included in FFO but not FAD:

Share-basedcompensation 11,014 4,866 22,845 13,671 expense in excessof cash paid

Foreign currencyexchange loss 45,703 10,318 97,953 (7,829 )(gain)

Impact of EITFD-42, including 9,883 10,706 48,265 37,246 equity investmentshare

Less: Capitalexpenditures to (37,764 ) (57,140 ) (163,834 ) (192,539 )maintain realestate facilities



FAD (a) $ 478,194 $ 443,640 $ 1,707,579 $ 1,696,350



Distributions paidto common shareholders andrestricted

share units $ 349,889 $ 349,754 $ 1,399,361 $ 1,398,570



Distribution payout 73.2 % 78.8 % 82.0 % 82.4 %ratio



Distributions per $ 2.00 $ 2.00 $ 8.00 $ 8.00 common share



(a)

FFO and FFO per share are non-GAAP measures defined by the National Association of Real Estate Investment Trusts and, along with the non-GAAP measure FAD, are considered helpful measures of REIT performance by REITs and many REIT analysts. FFO represents GAAP net income before depreciation and amortization, real estate gains or losses and impairment charges, which are excluded because they are based upon historical costs and assume that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. FAD represents FFO adjusted to exclude certain non-cash charges and to deduct capital expenditures. We utilize FAD in evaluating our ongoing cash flow available for investment, debt repayment and common distributions. We believe investors and analysts utilize FAD in a similar manner. FFO and FFO per share are not a substitute for net income or earnings per share. FFO and FAD are not substitutes for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because they exclude investing and financing activities presented on our statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful.

FFO and FFO per share are non-GAAP measures defined by the National Association of Real Estate Investment Trusts and, along with the non-GAAP measure FAD, are considered helpful measures of REIT performance by REITs and many REIT analysts. FFO represents GAAP net income before depreciation and amortization, real estate gains or losses and impairment charges, which are excluded because they are based upon historical costs and assume that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. FAD represents FFO(a) adjusted to exclude certain non-cash charges and to deduct capital expenditures. We utilize FAD in evaluating our ongoing cash flow available for investment, debt repayment and common distributions. We believe investors and analysts utilize FAD in a similar manner. FFO and FFO per share are not a substitute for net income or earnings per share. FFO and FAD are not substitutes for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because they exclude investing and financing activities presented on our statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful.

PUBLIC STORAGE

SELECTED FINANCIAL DATA

Reconciliation of Self-Storage Net Operating Income to

Net Income

(Unaudited - amounts in thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2020

2019

2020

2019

Self-storage revenues for:

Same Store Facilities

$

619,512

$

614,782

$

2,436,546

$

2,460,229

Acquired facilities

19,046

10,004

59,818

28,733

Developed and expanded facilities

48,927

41,255

180,764

151,043

Other non-same store facilities

11,453

10,986

44,502

44,547

Self-storage revenues

698,938

677,027

2,721,630

2,684,552

Self-storage cost of operations for:

Same Store Facilities

140,911

142,480

687,828

669,763

Acquired facilities

8,247

3,944

27,627

12,456

Developed and expanded facilities

17,406

14,727

75,642

64,312

Other non-same store facilities

3,750

3,768

16,446

15,885

Self-storage cost of operations

170,314

164,919

807,543

762,416

Self-storage NOI for:

Same Store Facilities

478,601

472,302

1,748,718

1,790,466

Acquired facilities

10,799

6,060

32,191

16,277

Developed and expanded facilities

31,521

26,528

105,122

86,731

Other non-same store facilities

7,703

7,218

28,056

28,662

Self-storage NOI (a)

528,624

512,108

1,914,087

1,922,136

Ancillary revenues

49,598

42,965

193,438

170,556

Ancillary cost of operations

(15,838

)

(12,215

)

(59,919

)

(50,736

)

Depreciation and amortization

(141,406

)

(134,885

)

(553,257

)

(512,918

)

General and administrative expense

(30,140

)

(17,855

)

(83,199

)

(62,146

)

Interest and other income

3,522

6,028

22,323

26,683

Interest expense

(14,235

)

(12,647

)

(56,283

)

(45,641

)

Equity in earnings of unconsolidated real estate entities

17,634

13,916

80,497

69,547

Gain on sale of real estate

376

-

1,493

341

Foreign currency exchange (loss) gain

(45,703

)

(10,318

)

(97,953

)

7,829

Net income on our income statement

$

352,432

$

387,097

$

1,361,227

$

1,525,651

PUBLIC STORAGE

SELECTED FINANCIAL DATA



Reconciliation of Self-Storage Net Operating Income to

Net Income

(Unaudited - amounts in thousands)





Three Months Ended Year Ended

December 31, December 31,

2020 2019 2020 2019



Self-storage revenues for:

Same Store $ 619,512 $ 614,782 $ 2,436,546 $ 2,460,229 Facilities

Acquired 19,046 10,004 59,818 28,733 facilities

Developed andexpanded 48,927 41,255 180,764 151,043 facilities

Other non-same 11,453 10,986 44,502 44,547 store facilities

Self-storage 698,938 677,027 2,721,630 2,684,552 revenues



Self-storage costof operations for:

Same Store 140,911 142,480 687,828 669,763 Facilities

Acquired 8,247 3,944 27,627 12,456 facilities

Developed andexpanded 17,406 14,727 75,642 64,312 facilities

Other non-same 3,750 3,768 16,446 15,885 store facilities

Self-storage cost 170,314 164,919 807,543 762,416 of operations



Self-storage NOI for:

Same Store 478,601 472,302 1,748,718 1,790,466 Facilities

Acquired 10,799 6,060 32,191 16,277 facilities

Developed andexpanded 31,521 26,528 105,122 86,731 facilities

Other non-same 7,703 7,218 28,056 28,662 store facilities

Self-storage NOI 528,624 512,108 1,914,087 1,922,136 (a)

Ancillary 49,598 42,965 193,438 170,556 revenues

Ancillary cost of (15,838 ) (12,215 ) (59,919 ) (50,736 )operations

Depreciation and (141,406 ) (134,885 ) (553,257 ) (512,918 )amortization

General andadministrative (30,140 ) (17,855 ) (83,199 ) (62,146 )expense

Interest and 3,522 6,028 22,323 26,683 other income

Interest expense (14,235 ) (12,647 ) (56,283 ) (45,641 )

Equity inearnings ofunconsolidated 17,634 13,916 80,497 69,547 real estateentities

Gain on sale of 376 - 1,493 341 real estate

Foreign currencyexchange (loss) (45,703 ) (10,318 ) (97,953 ) 7,829 gain

Net income on our $ 352,432 $ 387,097 $ 1,361,227 $ 1,525,651 income statement

(a)

Net operating income or "NOI" is a non-GAAP financial measure that excludes the impact of depreciation and amortization expense, which is based upon historical costs and assumes that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. We utilize NOI in determining current property values, evaluating property performance, and in evaluating operating trends. We believe that investors and analysts utilize NOI in a similar manner. NOI is not a substitute for net income, operating cash flow, or other related GAAP financial measures, in evaluating our operating results. This table reconciles from NOI for our self-storage facilities to the net income presented on our income statement.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210224006065/en/

CONTACT: Ryan Burke (818) 244-8080, Ext. 1141