Business Wire | Nov 2, 2021 04:07PM EDT

National Storage Affiliates Trust Reports Third Quarter 2021 Results

Nov. 02, 2021

GREENWOOD VILLAGE, Colo.--(BUSINESS WIRE)--Nov. 02, 2021--National Storage Affiliates Trust ("NSA" or the "Company") (NYSE: NSA) today reported the Company's third quarter 2021 results.

Third Quarter 2021 Highlights

* Reported net income of $40.7 million for the third quarter of 2021, an increase of 90.2% compared to the third quarter of 2020. Reported diluted earnings per share of $0.26 for the third quarter of 2021 compared to $0.15 for the third quarter of 2020. * Reported core funds from operations ("Core FFO") of $67.5 million, or $0.57 per share for the third quarter of 2021, an increase of 29.5% per share compared to the third quarter of 2020. * Reported an increase in same store net operating income ("NOI") of 24.3% for the third quarter of 2021 compared to the same period in 2020, driven by an 18.4% increase in same store total revenues partially offset by an increase of 4.6% in same store property operating expenses. * Reported same store period-end occupancy of 96.2% as of September 30, 2021, an increase of 450 basis points compared to September 30, 2020. * Acquired 76 wholly-owned self storage properties for $599.3 million during the third quarter of 2021. Consideration for these acquisitions included the issuance of $31.1 million of OP equity. * Completed an underwritten public offering of 10,120,000 common shares resulting in net proceeds of approximately $497.4 million. * Increased the total borrowing capacity under the Company's credit facility in September 2021 with the addition of a $125.0 million 5.5-year term loan tranche E. * Issued the previously announced $35.0 million of 2.16% senior unsecured notes due May 4, 2026 and $90.0 million of 3.00% senior unsecured notes due May 4, 2031 on July 26, 2021 in a private placement to certain institutional investors. * Entered into an agreement on July 9, 2021 with a single lender for an $88.0 million interest-only secured debt financing that matures in July 2028 and has a fixed interest rate of 2.77%. * Received approximately $40.0 million of net proceeds from the sale of 782,000 common shares under the Company's at the market ("ATM") program.

Highlights Subsequent to Quarter-End

* Acquired 39 wholly-owned self storage properties for approximately $325.7 million.

Tamara Fischer, President and Chief Executive Officer, commented, "Third quarter 2021 was an outstanding quarter for NSA with the investment of nearly $600 million in the acquisition of 76 self storage properties and the continuing outperformance of our same store portfolio which generated 24.3% NOI growth. We're optimistic that the favorable tailwinds impacting the self storage industry will continue to drive healthy results for the remainder of the year and into 2022."

Financial Results

($ inthousands,except per Three Months Ended September 30, Nine Months Ended September 30,share andunit data)

2021 2020 Growth 2021 2020 Growth

Net income $ 40,730 $ 21,411 90.2 % $ 104,040 $ 54,961 89.3 %



Funds FromOperations $ 66,966 $ 43,440 54.2 % $ 177,476 $ 120,727 47.0 %("FFO")^(1)

Add backacquisition 512 596 (14.1) % 922 1,681 (45.2) %costs

Core FFO^ $ 67,478 $ 44,036 53.2 % $ 178,398 $ 122,408 45.7 %(1)



Earnings(loss) per $ 0.31 $ 0.15 106.7 % $ 0.89 $ 0.32 178.1 %share -basic

Earnings(loss) per $ 0.26 $ 0.15 73.3 % $ 0.71 $ 0.32 121.9 %share -diluted



FFO pershare and $ 0.56 $ 0.43 30.2 % $ 1.60 $ 1.23 30.1 %unit^(1)

Core FFOper share $ 0.57 $ 0.44 29.5 % $ 1.61 $ 1.25 28.8 %and unit^(1)

(1) Non-GAAP financial measures, including FFO, Core FFO and NOI, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information

Net income increased $19.3 million for the third quarter of 2021 and $49.1 million for the nine months ended September 30, 2021 ("year-to-date") as compared to the same periods in 2020. These increases resulted primarily from additional NOI generated from the 152 self storage properties acquired between October 1, 2020 and September 30, 2021 and same store NOI growth, partially offset by increases in depreciation and amortization.

The increases in FFO and Core FFO for the third quarter of 2021 and year-to-date were primarily the result of incremental NOI from properties acquired between October 1, 2020 and September 30, 2021 and same store NOI growth, partially offset by increases in subordinated performance unit distributions.

Same Store Operating Results (560 Stores)

^(1) Non-GAAP financial measures, including FFO, Core FFO and NOI, are definedin the Glossary in the supplemental financial information and, whereappropriate, reconciliations of these measures and other non-GAAP financialmeasures to their most directly comparable GAAP measures are included in theSchedules to this press release and in the supplemental financial information

Net income increased $19.3 million for the third quarter of 2021 and $49.1 million for the nine months ended September 30, 2021 ("year-to-date") as compared to the same periods in 2020. These increases resulted primarily from additional NOI generated from the 152 self storage properties acquired between October 1, 2020 and September 30, 2021 and same store NOI growth, partially offset by increases in depreciation and amortization.

The increases in FFO and Core FFO for the third quarter of 2021 and year-to-date were primarily the result of incremental NOI from properties acquired between October 1, 2020 and September 30, 2021 and same store NOI growth, partially offset by increases in subordinated performance unit distributions.

Same Store Operating Results (560 Stores)

($ inthousands,except per Three Months Ended September 30, Nine Months Ended September 30,squarefoot data)

2021 2020 Growth 2021 2020 Growth

Total $ 113,872 $ 96,140 18.4 % $ 322,771 $ 282,341 14.3 %revenues

Propertyoperating 30,085 28,757 4.6 % 87,777 85,094 3.2 %expenses

NetOperating $ 83,787 $ 67,383 24.3 % $ 234,994 $ 197,247 19.1 %Income (NOI)

NOI Margin 73.6 % 70.1 % 3.5 % 72.8 % 69.9 % 2.9 %



Average 96.5 % 90.7 % 5.8 % 94.7 % 88.6 % 6.1 %Occupancy

AverageAnnualizedRentalRevenue $ 13.40 $ 12.02 11.5 % $ 12.90 $ 12.09 6.7 %Per OccupiedSquareFoot



Year-over-year same store total revenues increased 18.4% for the third quarter of 2021 and 14.3% year-to-date as compared to the same periods in 2020. The increase for the third quarter of 2021 was driven primarily by a 580 basis point increase in average occupancy and an 11.5% increase in average annualized rental revenue per occupied square foot. The year-to-date increase was driven primarily by a 610 basis point increase in average occupancy and a 6.7% increase in average annualized rental revenue per occupied square foot. Markets which generated above portfolio average same store total revenue growth include: Portland, Phoenix, Sarasota and Las Vegas. Markets which generated below portfolio average same store total revenue growth include: Oklahoma City, Dallas, Los Angeles and Tulsa.

Year-over-year same store property operating expenses increased 4.6% for the third quarter of 2021 and 3.2% year-to-date as compared to the same periods in 2020. The increases primarily resulted from increases in personnel expense, property taxes and repairs and maintenance expense offset by decreases in marketing expense.

Investment Activity

During the third quarter, NSA invested approximately $599.3 million in the acquisition of 76 self storage properties consisting of approximately 5.1 million rentable square feet configured in approximately 35,644 storage units. Total consideration for these acquisitions included approximately $562.1 million of net cash, the issuance of approximately $19.9 million of OP units and $11.2 million of subordinated performance units and the assumption of approximately $6.1 million of other liabilities.

Balance Sheet

During the third quarter, the Company received approximately $40.0 million of net proceeds from the sale of 782,000 common shares under the Company's at the market ("ATM") program. Subsequent to quarter end, the Company received approximately $7.4 million of net proceeds from the sale of 125,000 common shares under the ATM program. The Company used the net proceeds for self storage property acquisitions and to repay borrowings outstanding under its revolving line of credit. As of November 2, 2021, the Company has approximately $300.6 million of capacity remaining under its ATM program.

On May 3, 2021, the Company's operating partnership entered into an agreement to issue $180.0 million of senior unsecured notes, comprised of $35.0 million of 2.16% senior unsecured notes due May 4, 2026 (the "2026 Notes"), $90.0 million of 3.00% senior unsecured notes due May 4, 2031 (the "May 2031 Notes") and $55.0 million of 3.10% senior unsecured notes due May 4, 2033 (the "2033 Notes"). On May 26, 2021 the operating partnership issued the 2033 Notes and on July 26, 2021 the operating partnership issued the 2026 Notes and the May 2031 Notes. The Company used the proceeds to repay outstanding amounts on its revolving line of credit and for general corporate purposes.

On July 9, 2021, the Company entered into an agreement with a single lender for an $88.0 million debt financing secured by a first lien on eight of the Company's self storage properties. This interest-only loan matures in July 2028 and has a fixed interest rate of 2.77%. The Company used the proceeds to repay outstanding amounts on its revolving line of credit.

In July 2021, NSA completed an underwritten public offering of 10,120,000 common shares, including 1,320,000 common shares sold upon the exercise in full by the underwriters of their option to purchase additional common shares. The shares were issued at a price of $51.25 per share, resulting in net proceeds of approximately $497.4 million. The Company used the proceeds for self storage property acquisitions, general corporate purposes and to repay borrowings outstanding under its revolving line of credit.

On August 9, 2021, NSA entered into an amendment to its credit agreement with a syndicated group of lenders to reduce the applicable margins on its $175.0 million tranche D term loan from a range of LIBOR plus 1.50% to 2.20% to LIBOR plus 1.10% to 1.55%.

On September 21, 2021, NSA entered into an increase agreement and amendment with a syndicated group of lenders to increase the total borrowing capacity under the Company's credit facility by $125.0 million for a total credit facility of $1.4 billion, which included entry into a new $125.0 million 5.5-year term loan tranche E. NSA has an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.75 billion. The Company used the proceeds for self storage property acquisitions and for general corporate purposes.

Common Share Dividends

On August 25, 2021, NSA's Board of Trustees declared a quarterly cash dividend of $0.41 per common share, representing a 20.6% increase from the third quarter 2020. The third quarter 2021 dividend was paid on September 30, 2021 to shareholders of record as of September 15, 2021.

2021 Guidance

The following table outlines NSA's updated and prior FFO guidance estimates and related assumptions for the year ended December 31, 2021:

Current Ranges for Prior Ranges for Actual Full Year 2021 Full Year 2021 Results for Full Year Low High Low High 2020

Core FFO per $ 2.19 $ 2.22 $ 2.11 $ 2.14 $ 1.71 share^(1)



Same store operations

Total revenue 14.0 % 15.0 % 11.75 % 12.75 % 1.7 %growth

Propertyoperating 3.0 % 4.0 % 2.5 % 3.5 % 0.5 %expenses growth

NOI growth 18.0 % 20.0 % 15.0 % 17.0 % 2.2 %



General andadministrative expenses

General andadministrativeexpenses(excluding $ 45.0 $ 46.0 $ 45.0 $ 46.0 $ 39.3 equity-basedcompensation),in millions

Equity-basedcompensation, $ 5.5 $ 6.0 $ 5.5 $ 6.0 $ 4.3 in millions



Managementfees and other $ 24.0 $ 25.0 $ 24.0 $ 25.0 $ 23.0 revenue, in millions

Core FFO fromunconsolidatedreal estate $ 20.0 $ 21.0 $ 19.0 $ 20.0 $ 15.6 ventures, inmillions



Subordinatedperformanceunit $ 46.0 $ 48.0 $ 43.0 $ 45.0 $ 29.7 distributions,in millions



Acquisitionsof selfstorage $ 1,500.0 $ 2,000.0 $ 1,100.0 $ 1,300.0 $ 543.3 properties, inmillions

(1) The following table provides a reconciliation of the range of estimated earnings (loss) per share - diluted to estimated Core FFO per share and unit:

Current Ranges forFull Year 2021

Prior Ranges forFull Year 2021

Low

High

Low

High

Earnings (loss) per share - diluted

$

0.98

$

1.07

$

0.94

$

1.03

Impact of the difference in weighted average number of shares and GAAP accounting for noncontrolling interests, two-class method and treasury stock method

0.16

0.06

0.15

0.06

Add real estate depreciation and amortization, including NSA's share of unconsolidated venture real estate depreciation and amortization

1.44

1.49

1.39

1.43

FFO attributable to subordinated unitholders

(0.40

)

(0.42

)

(0.38

)

(0.40

)

Add acquisition costs and NSA's share of unconsolidated real estate venture acquisition costs

0.01

0.02

0.01

0.02

Core FFO per share and unit

$

2.19

$

2.22

$

2.11

$

2.14

Supplemental Financial Information

The full text of this earnings release and supplemental financial information, including certain financial information referenced in this release, are available on NSA's website at http://ir.nationalstorageaffiliates.com/quarterly-reporting and as exhibit 99.1 to the Company's Form 8-K furnished to the SEC on November 2, 2021.

Non-GAAP Financial Measures & Glossary

This press release contains certain non-GAAP financial measures. These non-GAAP measures are presented because NSA's management believes these measures help investors understand NSA's business, performance and ability to earn and distribute cash to its shareholders by providing perspectives not immediately apparent from net income (loss). These measures are also frequently used by securities analysts, investors and other interested parties. The presentations of FFO, Core FFO and NOI in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. In addition, NSA's method of calculating these measures may be different from methods used by other companies, and, accordingly, may not be comparable to similar measures as calculated by other companies that do not use the same methodology as NSA. These measures, and other words and phrases used herein, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Quarterly Teleconference and Webcast

The Company will host a conference call at 1:00 pm Eastern Time on Wednesday, November 3, 2021 to discuss its third quarter 2021 financial results. At the conclusion of the call, management will accept questions from certified financial analysts. All other participants are encouraged to listen to a webcast of the call by accessing the link found on the Company's website at www.nationalstorageaffiliates.com.

Conference Call and Webcast:

Date/Time: Wednesday, November 3, 2021, 1:00pm ET

Webcast available at: www.nationalstorageaffiliates.com

Domestic (Toll Free US & Canada): 877.407.9711

International: 412.902.1014

Replay:

Domestic (Toll Free US & Canada): 877.660.6853

International: 201.612.7415

Conference ID: 13692161

A replay of the call will be available for one week through Wednesday, November 10, 2021. A replay of the webcast will be available for 30 days on NSA's website at www.nationalstorageaffiliates.com.

Upcoming Industry Conferences

NSA management is scheduled to participate in the Nareit REITworld Virtual Conference, November 9 - 11, 2021.

About National Storage Affiliates Trust

National Storage Affiliates Trust is a real estate investment trust headquartered in Greenwood Village, Colorado, focused on the ownership, operation and acquisition of self storage properties located within the top 100 metropolitan statistical areas throughout the United States. As of September 30, 2021, the Company held ownership interests in and operated 940 self storage properties located in 38 states and Puerto Rico with approximately 60.4 million rentable square feet. NSA is one of the largest owners and operators of self storage properties among public and private companies in the United States. For more information, please visit the Company's website at www.nationalstorageaffiliates.com. NSA is included in the MSCI US REIT Index (RMS/RMZ), the Russell 2000 Index of Companies and the S&P MidCap 400 Index.

NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements contained in this press release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company's control. These forward-looking statements include information about possible or assumed future results of the Company's business, financial condition, liquidity, results of operations, plans and objectives. Changes in any circumstances may cause the Company's actual results to differ significantly from those expressed in any forward-looking statement. When used in this release, the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may" or similar expressions are intended to identify forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: market trends in the Company's industry, interest rates, the debt and lending markets or the general economy; the Company's business and investment strategy; the acquisition of properties, including those under contract and the Company's ability to execute on its acquisition pipeline; the timing of acquisitions under contract; the internalization of retiring participating regional operators ("PROs") into the Company; negative impacts from the COVID-19 pandemic on the economy, the self storage industry, the broader financial markets, the Company's financial condition, results of operations and cash flows and the ability of the Company's tenants to pay rent; and the Company's guidance estimates for the year ended December 31, 2021. For a further list and description of such risks and uncertainties, see the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission, and the other documents filed by the Company with the Securities and Exchange Commission. The forward-looking statements, and other risks, uncertainties and factors are based on the Company's beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

^(1) The following table provides a reconciliation of the range of estimatedearnings (loss) per share - diluted to estimated Core FFO per share and unit:

Current Ranges for Prior Ranges for Full Year 2021 Full Year 2021

Low High Low High

Earnings (loss) per share - $ 0.98 $ 1.07 $ 0.94 $ 1.03 diluted

Impact of the difference inweighted average number of sharesand GAAP accounting for 0.16 0.06 0.15 0.06 noncontrolling interests,two-class method and treasurystock method

Add real estate depreciation andamortization, including NSA'sshare of unconsolidated venture 1.44 1.49 1.39 1.43 real estate depreciation andamortization

FFO attributable to subordinated (0.40 ) (0.42 ) (0.38 ) (0.40 )unitholders

Add acquisition costs and NSA'sshare of unconsolidated real 0.01 0.02 0.01 0.02 estate venture acquisition costs

Core FFO per share and unit $ 2.19 $ 2.22 $ 2.11 $ 2.14

Supplemental Financial Information

The full text of this earnings release and supplemental financial information, including certain financial information referenced in this release, are available on NSA's website at http://ir.nationalstorageaffiliates.com/quarterly-reporting and as exhibit 99.1 to the Company's Form 8-K furnished to the SEC on November 2, 2021.

Non-GAAP Financial Measures & Glossary

This press release contains certain non-GAAP financial measures. These non-GAAP measures are presented because NSA's management believes these measures help investors understand NSA's business, performance and ability to earn and distribute cash to its shareholders by providing perspectives not immediately apparent from net income (loss). These measures are also frequently used by securities analysts, investors and other interested parties. The presentations of FFO, Core FFO and NOI in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. In addition, NSA's method of calculating these measures may be different from methods used by other companies, and, accordingly, may not be comparable to similar measures as calculated by other companies that do not use the same methodology as NSA. These measures, and other words and phrases used herein, are defined in the Glossary in the supplemental financial information and, where appropriate, reconciliations of these measures and other non-GAAP financial measures to their most directly comparable GAAP measures are included in the Schedules to this press release and in the supplemental financial information.

Quarterly Teleconference and Webcast

The Company will host a conference call at 1:00 pm Eastern Time on Wednesday, November 3, 2021 to discuss its third quarter 2021 financial results. At the conclusion of the call, management will accept questions from certified financial analysts. All other participants are encouraged to listen to a webcast of the call by accessing the link found on the Company's website at www.nationalstorageaffiliates.com.

Conference Call and Webcast:

Date/Time: Wednesday, November 3, 2021, 1:00pm ET

Webcast available at: www.nationalstorageaffiliates.com

Domestic (Toll Free US & Canada): 877.407.9711

International: 412.902.1014

Replay:

Domestic (Toll Free US & Canada): 877.660.6853

International: 201.612.7415

Conference ID: 13692161

A replay of the call will be available for one week through Wednesday, November 10, 2021. A replay of the webcast will be available for 30 days on NSA's website at www.nationalstorageaffiliates.com.

Upcoming Industry Conferences

NSA management is scheduled to participate in the Nareit REITworld Virtual Conference, November 9 - 11, 2021.

About National Storage Affiliates Trust

National Storage Affiliates Trust is a real estate investment trust headquartered in Greenwood Village, Colorado, focused on the ownership, operation and acquisition of self storage properties located within the top 100 metropolitan statistical areas throughout the United States. As of September 30, 2021, the Company held ownership interests in and operated 940 self storage properties located in 38 states and Puerto Rico with approximately 60.4 million rentable square feet. NSA is one of the largest owners and operators of self storage properties among public and private companies in the United States. For more information, please visit the Company's website at www.nationalstorageaffiliates.com. NSA is included in the MSCI US REIT Index (RMS/RMZ), the Russell 2000 Index of Companies and the S&P MidCap 400 Index.

NOTE REGARDING FORWARD LOOKING STATEMENTS

Certain statements contained in this press release constitute forward-looking statements as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Forward-looking statements are subject to substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company's control. These forward-looking statements include information about possible or assumed future results of the Company's business, financial condition, liquidity, results of operations, plans and objectives. Changes in any circumstances may cause the Company's actual results to differ significantly from those expressed in any forward-looking statement. When used in this release, the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may" or similar expressions are intended to identify forward-looking statements. Statements regarding the following subjects, among others, may be forward-looking: market trends in the Company's industry, interest rates, the debt and lending markets or the general economy; the Company's business and investment strategy; the acquisition of properties, including those under contract and the Company's ability to execute on its acquisition pipeline; the timing of acquisitions under contract; the internalization of retiring participating regional operators ("PROs") into the Company; negative impacts from the COVID-19 pandemic on the economy, the self storage industry, the broader financial markets, the Company's financial condition, results of operations and cash flows and the ability of the Company's tenants to pay rent; and the Company's guidance estimates for the year ended December 31, 2021. For a further list and description of such risks and uncertainties, see the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission, and the other documents filed by the Company with the Securities and Exchange Commission. The forward-looking statements, and other risks, uncertainties and factors are based on the Company's beliefs, assumptions and expectations of its future performance, taking into account all information currently available to the Company. Forward-looking statements are not predictions of future events. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

National Storage Affiliates Trust

Consolidated Statements of Operations

(in thousands, except per share amounts)

(unaudited)

Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

REVENUE

Rental revenue $ 139,420 $ 99,690 $ 379,857 $ 290,394

Other property-related 5,141 3,883 14,107 10,672 revenue

Management fees and other 6,282 5,901 18,117 17,047 revenue

Total revenue 150,843 109,474 412,081 318,113

OPERATING EXPENSES

Property operating 39,465 31,546 110,723 92,395 expenses

General and administrative 13,012 10,818 36,700 32,241 expenses

Depreciation and 38,983 28,933 107,458 87,347 amortization

Other 994 479 1,701 1,330

Total operating expenses 92,454 71,776 256,582 213,313

OTHER (EXPENSE) INCOME

Interest expense (18,144) (15,262) (52,275) (46,403)

Equity in earnings(losses) of unconsolidated 1,682 37 3,615 (251) real estate ventures

Acquisition costs (512) (596) (922) (1,681)

Non-operating expense (241) (120) (562) (629)

Other expense (17,215) (15,941) (50,144) (48,964)

Income before income taxes 41,174 21,757 105,355 55,836

Income tax expense (444) (346) (1,315) (875)

Net income 40,730 21,411 104,040 54,961

Net income attributable to (10,506) (7,924) (24,260) (24,404) noncontrolling interests

Net income attributable toNational Storage 30,224 13,487 79,780 30,557 Affiliates Trust

Distributions to preferred (3,276) (3,275) (9,827) (9,822) shareholders

Net income attributable to $ 26,948 $ 10,212 $ 69,953 $ 20,735 common shareholders



Earnings (loss) per share $ 0.31 $ 0.15 $ 0.89 $ 0.32 - basic

Earnings (loss) per share $ 0.26 $ 0.15 $ 0.71 $ 0.32 - diluted



Weighted average shares 86,257 68,887 78,307 65,643 outstanding - basic

Weighted average shares 140,025 68,887 130,983 65,643 outstanding - diluted

National Storage Affiliates Trust

Consolidated Balance Sheets

(dollars in thousands, except per share amounts)

(unaudited)

September 30, December 31,

2021 2020

ASSETS

Real estate

Self storage properties $ 4,670,821 $ 3,639,192

Less accumulated depreciation (537,772 ) (443,623 )

Self storage properties, net 4,133,049 3,195,569

Cash and cash equivalents 69,246 18,723

Restricted cash 4,357 2,978

Debt issuance costs, net 1,896 2,496

Investment in unconsolidated real estate 192,015 202,533 ventures

Other assets, net 98,227 68,149

Operating lease right-of-use assets 22,444 23,129

Total assets $ 4,521,234 $ 3,513,577

LIABILITIES AND EQUITY

Liabilities

Debt financing $ 2,128,485 $ 1,916,971

Accounts payable and accrued liabilities 62,562 47,043

Interest rate swap liabilities 48,153 77,918

Operating lease liabilities 24,181 24,756

Deferred revenue 20,189 16,414

Total liabilities 2,283,570 2,083,102

Equity

Preferred shares of beneficial interest, parvalue $0.01 per share. 50,000,000 authorized,8,736,719 and 8,732,719 issued and 218,418 218,318 outstanding at September 30, 2021 andDecember 31, 2020, respectively, atliquidation preference

Common shares of beneficial interest, parvalue $0.01 per share. 250,000,000 sharesauthorized, 88,945,849 and 71,293,117 shares 889 713 issued and outstanding at September 30, 2021and December 31, 2020, respectively

Additional paid-in capital 1,692,481 1,050,714

Distributions in excess of earnings (272,636 ) (251,704 )

Accumulated other comprehensive loss (30,303 ) (49,084 )

Total shareholders' equity 1,608,849 968,957

Noncontrolling interests 628,815 461,518

Total equity 2,237,664 1,430,475

Total liabilities and equity $ 4,521,234 $ 3,513,577

Reconciliation of Net Income to FFO and Core FFO(in thousands, except per share and unit amounts) (unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Net income

$

40,730

$

21,411

$

104,040

$

54,961

Add (subtract):

Real estate depreciation and amortization

38,636

28,564

106,404

86,283

Company's share of unconsolidated real estate venture real estate depreciation and amortization

3,842

3,830

11,563

11,428

Mark-to-market changes in value on equity securities

-

-

-

142

Distributions to preferred shareholders and unitholders

(3,517

)

(3,513

)

(10,551

)

(10,541

)

FFO attributable to subordinated performance unitholders(1)

(12,725

)

(6,852

)

(33,980

)

(21,546

)

FFO attributable to common shareholders, OP unitholders, and LTIP unitholders

66,966

43,440

177,476

120,727

Add:

Acquisition costs

512

596

922

1,681

Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders

$

67,478

$

44,036

$

178,398

$

122,408

Weighted average shares and units outstanding - FFO and Core FFO:(2)

Weighted average shares outstanding - basic

86,257

68,887

78,307

65,643

Weighted average restricted common shares outstanding

39

32

32

30

Weighted average effect of forward offering agreement(3)

-

-

133

-

Weighted average OP units outstanding

30,103

29,559

29,940

29,994

Weighted average DownREIT OP unit equivalents outstanding

1,925

1,925

1,925

1,900

Weighted average LTIP units outstanding

525

513

549

555

Total weighted average shares and units outstanding - FFO and Core FFO

118,849

100,916

110,886

98,122

FFO per share and unit

$

0.56

$

0.43

$

1.60

$

1.23

Core FFO per share and unit

$

0.57

$

0.44

$

1.61

$

1.25

(1) Amounts represent distributions declared for subordinated performance unitholders and DownREIT subordinated performance unitholders for the periods presented.

(2) NSA combines OP units and DownREIT OP units with common shares because, after the applicable lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at NSA's option, exchangeable for common shares on a one-for-one basis and DownREIT OP units are also redeemable for cash or, at NSA's option, exchangeable for OP units in the Company's operating partnership on a one-for-one basis, subject to certain adjustments in each case. Subordinated performance units, DownREIT subordinated performance units and LTIP units may also, under certain circumstances, be convertible into or exchangeable for common shares (or other units that are convertible into or exchangeable for common shares). See footnote(4) for additional discussion of subordinated performance units, DownREIT subordinated performance units, and LTIP units in the calculation of FFO and Core FFO per share and unit.

(3) Represents the dilutive effect of the forward offering from the application of the treasury stock method.

Reconciliation of Net Income to FFO and Core FFO(in thousands, except per share and unit amounts) (unaudited)



Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Net income $ 40,730 $ 21,411 $ 104,040 $ 54,961

Add (subtract):

Real estate depreciation and 38,636 28,564 106,404 86,283 amortization

Company's share ofunconsolidated real estate 3,842 3,830 11,563 11,428 venture real estatedepreciation and amortization

Mark-to-market changes in value - - - 142 on equity securities

Distributions to preferred (3,517 ) (3,513 ) (10,551 ) (10,541 )shareholders and unitholders

FFO attributable tosubordinated performance (12,725 ) (6,852 ) (33,980 ) (21,546 )unitholders^(1)

FFO attributable to commonshareholders, OP unitholders, 66,966 43,440 177,476 120,727 and LTIP unitholders

Add:

Acquisition costs 512 596 922 1,681

Core FFO attributable to commonshareholders, OP unitholders, $ 67,478 $ 44,036 $ 178,398 $ 122,408 and LTIP unitholders



Weighted average shares andunits outstanding - FFO and Core FFO:^(2)

Weighted average shares 86,257 68,887 78,307 65,643 outstanding - basic

Weighted average restricted 39 32 32 30 common shares outstanding

Weighted average effect of - - 133 - forward offering agreement^(3)

Weighted average OP units 30,103 29,559 29,940 29,994 outstanding

Weighted average DownREIT OP 1,925 1,925 1,925 1,900 unit equivalents outstanding

Weighted average LTIP units 525 513 549 555 outstanding

Total weighted average sharesand units outstanding - FFO and 118,849 100,916 110,886 98,122 Core FFO



FFO per share and unit $ 0.56 $ 0.43 $ 1.60 $ 1.23

Core FFO per share and unit $ 0.57 $ 0.44 $ 1.61 $ 1.25



(1) Amounts represent distributions declared for subordinated performanceunitholders and DownREIT subordinated performance unitholders for the periodspresented.

(2) NSA combines OP units and DownREIT OP units with common shares because,after the applicable lock-out periods, OP units in the Company's operatingpartnership are redeemable for cash or, at NSA's option, exchangeable forcommon shares on a one-for-one basis and DownREIT OP units are also redeemablefor cash or, at NSA's option, exchangeable for OP units in the Company'soperating partnership on a one-for-one basis, subject to certain adjustments ineach case. Subordinated performance units, DownREIT subordinated performanceunits and LTIP units may also, under certain circumstances, be convertible intoor exchangeable for common shares (or other units that are convertible into orexchangeable for common shares). See footnote^(4) for additional discussion ofsubordinated performance units, DownREIT subordinated performance units, andLTIP units in the calculation of FFO and Core FFO per share and unit.

(3) Represents the dilutive effect of the forward offering from the applicationof the treasury stock method.

Reconciliation of Earnings (Loss) Per Share - Diluted to FFO and Core FFO Per Share and Unit(in thousands, except per share and unit amounts) (unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Earnings (loss) per share - diluted

$

0.26

$

0.15

$

0.71

$

0.32

Impact of the difference in weighted average number of shares(4)

0.05

(0.05

)

0.14

(0.10

)

Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method(5)

-

0.08

-

0.23

Add real estate depreciation and amortization

0.33

0.28

0.96

0.88

Add Company's share of unconsolidated real estate venture real estate depreciation and amortization

0.03

0.04

0.10

0.12

FFO attributable to subordinated performance unitholders

(0.11

)

(0.07

)

(0.31

)

(0.22

)

FFO per share and unit

0.56

0.43

1.60

1.23

Add acquisition costs

0.01

0.01

0.01

0.02

Core FFO per share and unit

$

0.57

$

0.44

$

1.61

$

1.25

(4) Adjustment accounts for the difference between the weighted average number of shares used to calculate diluted earnings per share and the weighted average number of shares used to calculate FFO and Core FFO per share and unit. Diluted earnings per share is calculated using the two-class method for the company's restricted common shares and the treasury stock method for certain unvested LTIP units, and assumes the conversion of vested LTIP units into OP units on a one-for-one basis and the hypothetical conversion of subordinated performance units, and DownREIT subordinated performance units into OP units, even though such units may only be convertible into OP units (i) after a lock-out period and (ii) upon certain events or conditions. For additional information about the conversion of subordinated performance units and DownREIT subordinated performance units into OP units, see Note 10 to the Company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission. The computation of weighted average shares and units for FFO and Core FFO per share and unit includes all restricted common shares and LTIP units that participate in distributions and excludes all subordinated performance units and DownREIT subordinated performance units because their effect has been accounted for through the allocation of FFO to the related unitholders based on distributions declared.

(5) Represents the effect of adjusting the numerator to consolidated net income (loss) prior to GAAP allocations for noncontrolling interests, after deducting preferred share and unit distributions, and before the application of the two-class method and treasury stock method, as described in footnote(4).

Reconciliation of Earnings (Loss) Per Share - Diluted to FFO and Core FFO PerShare and Unit(in thousands, except per share and unit amounts) (unaudited)



Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Earnings (loss) per share - $ 0.26 $ 0.15 $ 0.71 $ 0.32 diluted

Impact of the difference inweighted average number of 0.05 (0.05 ) 0.14 (0.10 )shares^(4)

Impact of GAAP accounting fornoncontrolling interests, - 0.08 - 0.23 two-class method and treasurystock method^(5)

Add real estate depreciation and 0.33 0.28 0.96 0.88 amortization

Add Company's share ofunconsolidated real estate 0.03 0.04 0.10 0.12 venture real estate depreciationand amortization

FFO attributable to subordinated (0.11 ) (0.07 ) (0.31 ) (0.22 )performance unitholders

FFO per share and unit 0.56 0.43 1.60 1.23

Add acquisition costs 0.01 0.01 0.01 0.02

Core FFO per share and unit $ 0.57 $ 0.44 $ 1.61 $ 1.25



(4) Adjustment accounts for the difference between the weighted average numberof shares used to calculate diluted earnings per share and the weightedaverage number of shares used to calculate FFO and Core FFO per share andunit. Diluted earnings per share is calculated using the two-class method forthe company's restricted common shares and the treasury stock method forcertain unvested LTIP units, and assumes the conversion of vested LTIP unitsinto OP units on a one-for-one basis and the hypothetical conversion ofsubordinated performance units, and DownREIT subordinated performance unitsinto OP units, even though such units may only be convertible into OP units(i) after a lock-out period and (ii) upon certain events or conditions. Foradditional information about the conversion of subordinated performance unitsand DownREIT subordinated performance units into OP units, see Note 10 to theCompany's most recent Annual Report on Form 10-K, filed with the Securitiesand Exchange Commission. The computation of weighted average shares and unitsfor FFO and Core FFO per share and unit includes all restricted common sharesand LTIP units that participate in distributions and excludes all subordinatedperformance units and DownREIT subordinated performance units because theireffect has been accounted for through the allocation of FFO to the relatedunitholders based on distributions declared.

(5) Represents the effect of adjusting the numerator to consolidated netincome (loss) prior to GAAP allocations for noncontrolling interests, afterdeducting preferred share and unit distributions, and before the applicationof the two-class method and treasury stock method, as described in footnote^(4).

Net Operating Income(dollars in thousands) (unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Net income

$

40,730

$

21,411

$

104,040

$

54,961

(Subtract) add:

Management fees and other revenue

(6,282

)

(5,901

)

(18,117

)

(17,047

)

General and administrative expenses

13,012

10,818

36,700

32,241

Other

994

479

1,701

1,330

Depreciation and amortization

38,983

28,933

107,458

87,347

Interest expense

18,144

15,262

52,275

46,403

Equity in (earnings) losses of unconsolidated real estate ventures

(1,682

)

(37

)

(3,615

)

251

Acquisition costs

512

596

922

1,681

Income tax expense

444

346

1,315

875

Non-operating expense

241

120

562

629

Net Operating Income

$

105,096

$

72,027

$

283,241

$

208,671

Net Operating Income(dollars in thousands) (unaudited)



Three Months Ended Nine Months Ended September 30, September 30,

2021 2020 2021 2020

Net income $ 40,730 $ 21,411 $ 104,040 $ 54,961

(Subtract) add:

Management fees and other (6,282 ) (5,901 ) (18,117 ) (17,047 )revenue

General and administrative 13,012 10,818 36,700 32,241 expenses

Other 994 479 1,701 1,330

Depreciation and 38,983 28,933 107,458 87,347 amortization

Interest expense 18,144 15,262 52,275 46,403

Equity in (earnings)losses of unconsolidated (1,682 ) (37 ) (3,615 ) 251 real estate ventures

Acquisition costs 512 596 922 1,681

Income tax expense 444 346 1,315 875

Non-operating expense 241 120 562 629

Net Operating Income $ 105,096 $ 72,027 $ 283,241 $ 208,671

EBITDA and Adjusted EBITDA(dollars in thousands) (unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2021

2020

2021

2020

Net income

$

40,730

$

21,411

$

104,040

$

54,961

Add:

Depreciation and amortization

38,983

28,933

107,458

87,347

Company's share of unconsolidated real estate venture depreciation and amortization

3,842

3,830

11,563

11,428

Interest expense

18,144

15,262

52,275

46,403

Income tax expense

444

346

1,315

875

EBITDA

102,143

69,782

276,651

201,014

Add (subtract):

Acquisition costs

512

596

922

1,681

Equity-based compensation expense

1,454

1,183

4,088

3,108

Adjusted EBITDA

$

104,109

$

71,561

$

281,661

$

205,803

View source version on businesswire.com: https://www.businesswire.com/news/home/20211102006229/en/

CONTACT: National Storage Affiliates Trust Investor/Media Relations George Hoglund, CFA Vice President - Investor Relations 720.630.2160 ghoglund@nsareit.net