Global Self Storage Inc

Previous wording

The following discussion and analysis should be read in conjunction with our unaudited “Condensed Consolidated Financial Statements” and the “Notes to Condensed Consolidated Financial Statements (unaudited)” appearing elsewhere in this report. We make statements in this section that may be forward looking statements within the meaning of the federal securities laws. For a complete discussion of forward looking statements, see the section in this report entitled “Statement on Forward Looking Information.” References to the “Company,” “we,” “us,” or “our company” refer to Global Self Storage, Inc., a Maryland corporation, including, as the context requires, its direct and indirect subsidiaries.

Current wording

The following discussion and analysis should be read in conjunction with our unaudited “Condensed Consolidated Financial Statements” and the “Notes to Consolidated Financial Statements (unaudited)” appearing elsewhere in this report. We make statements in this section that may be forward looking statements within the meaning of the federal securities laws. For a complete discussion of forward looking statements, see the section in this report entitled “Statement on Forward Looking Information.” References to the “Company,” “we,” “us,” or “our company” refer to Global Self Storage, Inc., a Maryland corporation, including, as the context requires, its direct and indirect subsidiaries.

Previous wording

The Company is a self-administered and self-managed REIT that owns, operates, manages, acquires, develops and redevelops self storage properties (“stores” or “properties”) in the United States. Our stores are designed to offer affordable, easily accessible, and secure storage space for residential and commercial customers. As of June 30, 2024, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company. The Securities and Exchange Commission’s (“SEC”) order approving the Company’s application to deregister from the 1940 Act was granted on January 19, 2016. On January 19, 2016, the Company changed its name to Global Self Storage, Inc. from Self Storage Group, Inc., changed its SEC registration from an investment company to an operating company reporting under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and listed its common stock on NASDAQ under the symbol “SELF”.

Current wording

The Company is a self-administered and self-managed REIT that owns, operates, manages, acquires, and redevelops self storage properties (“stores” or “properties”) in the United States. Our stores are designed to offer affordable, easily accessible, and secure storage space for residential and commercial customers. As of September 30, 2024, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company. The Securities and Exchange Commission’s (“SEC”) order approving the Company’s application to deregister from the 1940 Act was granted on January 19, 2016. On January 19, 2016, the Company changed its name to Global Self Storage, Inc. from Self Storage Group, Inc., changed its SEC registration from an investment company to an operating company reporting under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and listed its common stock on NASDAQ under the symbol “SELF”.

Previous wording

On July 6, 2021, certain wholly owned subsidiaries (“Amended Credit Facility Secured Subsidiaries”) of the Company entered into a first amendment to the Credit Facility Loan Agreement (collectively, the “Amended Credit Facility Loan Agreement”) between the Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Amended Credit Facility Lender”). Under the Amended Credit Facility Loan Agreement, the Amended Credit Facility Secured Subsidiaries were able to borrow from the Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Amended Credit Facility Promissory Note”). The Amended Credit Facility Promissory Note bore an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and was due to mature on July 6, 2024. As of June 30, 2024, the effective interest rate was 8.44%. The publication of LIBOR ceased after June 30, 2023. The Amended Credit Facility Loan Agreement provided for a replacement index based on the Secured Overnight Financing Rate (“SOFR”). The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, was equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%. The obligations under the Amended Credit Facility Loan Agreement were secured by certain real estate assets owned by the Amended Credit Facility Secured Subsidiaries. The Company entered into an amended and restated guaranty of payment on July 6, 2021 (“Amended Credit Facility Guaranty,” and together with the Amended Credit Facility Loan Agreement, the Amended Credit Facility Promissory Note and related instruments, the “Amended Credit Facility Loan Documents”) to guarantee the payment to the Amended Credit Facility Lender of certain obligations of the Amended Credit Facility Secured Subsidiaries under the Amended Credit Facility Loan Agreement. The Company and the Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Amended Credit Facility Loan Documents.

Current wording

On July 6, 2021, certain wholly owned subsidiaries (“Amended Credit Facility Secured Subsidiaries”) of the Company entered into a first amendment to the Credit Facility Loan Agreement (collectively, the “Amended Credit Facility Loan Agreement”) between the Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Amended Credit Facility Lender”). Under the Amended Credit Facility Loan Agreement, the Amended Credit Facility Secured Subsidiaries were able to borrow from the Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Amended Credit Facility Promissory Note”). The Amended Credit Facility Promissory Note bore an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and was due to mature on July 6, 2024. As of September 30, 2024, the effective interest rate was 8.44%. The publication of LIBOR ceased after June 30, 2023. The Amended Credit Facility Loan Agreement provided for a replacement index based on the Secured Overnight Financing Rate (“SOFR”). The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, was equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%. The obligations under the Amended Credit Facility Loan Agreement were secured by certain real estate assets owned by the Amended Credit Facility Secured Subsidiaries. The Company entered into an amended and restated guaranty of payment on July 6, 2021 (“Amended Credit Facility Guaranty,” and together with the Amended Credit Facility Loan Agreement, the Amended Credit Facility Promissory Note and related instruments, the “Amended Credit Facility Loan Documents”) to guarantee the payment to the Amended Credit Facility Lender of certain obligations of the Amended Credit Facility Secured Subsidiaries under the Amended Credit Facility Loan Agreement. The Company and the Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Amended Credit Facility Loan Documents. As described in more detail below, the Amended Credit Facility Loan Agreement has been replaced in its entirety by the Second Amended Credit Facility Loan Agreement on July 6, 2024.

Previous wording

On January 14, 2022, the Company entered into an At Market Offering Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. (the “Agent”) pursuant to which the Company may sell, from time to time, shares of common stock having an aggregate offering price of up to $15,000,000, through the Agent. During the twelve months ended December 31, 2022, under the Sales Agreement, the Company sold and issued an aggregate of 373,833 shares of common stock and raised aggregate gross proceeds of approximately $2,272,628, less sales commissions of approximately $45,491 and other offering costs resulting in net proceeds of $2,008,436. There were no shares of common stock sold during the three and six months ended June 30, 2024 and June 30, 2023 under the Sales Agreement.

Current wording

On January 14, 2022, the Company entered into an At Market Offering Sales Agreement (the “Sales Agreement”) with B. Riley Securities, Inc. (the “Agent”) pursuant to which the Company may sell, from time to time, shares of common stock having an aggregate offering price of up to $15,000,000, through the Agent. During the twelve months ended December 31, 2022, under the Sales Agreement, the Company sold and issued an aggregate of 373,833 shares of common stock and raised aggregate gross proceeds of approximately $2,272,628, less sales commissions of approximately $45,491 and other offering costs resulting in net proceeds of $2,008,436. There were no shares of common stock sold during the three and nine months ended September 30, 2024 and September 30, 2023 under the Sales Agreement.

Previous wording

As of July 6, 2024, certain wholly owned subsidiaries (“Second Amended Credit Facility Secured Subsidiaries”) of the Company entered into a second amendment to the Credit Facility Loan Agreement (collectively, the “Second Amended Credit Facility Loan Agreement”) between the Second Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Second Amended Credit Facility Lender”). Under the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Secured Subsidiaries may borrow from the Second Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Second Amended Credit Facility Promissory Note”). The Second Amended Credit Facility Promissory Note bears an interest rate equal to 3% plus the greater of the One Month SOFR or 0.25% and is due to mature on July 6, 2027, with an option to extend the maturity to July 6, 2028. An annual unused facility fee is charged based on the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during the trailing twelve month period ending each June 30. The fee will be calculated at 0.25% per annum if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was greater than fifty percent, and will be calculated at 0.15% if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was less than or equal to fifty percent. The obligations under the Second Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Second Amended Credit Facility Secured Subsidiaries. The Company entered into a second amended and restated guaranty of payment as of July 6, 2024 (“Second Amended Credit Facility Guaranty,” and together with the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Promissory Note and related instruments, the “Second Amended Credit Facility Loan Documents”) to guarantee the payment to the Second Amended Credit Facility Lender of certain obligations of the Second Amended Credit Facility Secured Subsidiaries under the Second Amended Credit Facility Loan Agreement. The Company and the Second Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Second Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Second Amended Credit Facility Lender. As of June 30, 2024, we have no withdrawn proceeds under the Second Amended Credit Facility Loan Agreement. We currently intend to strategically withdraw proceeds available under the Second Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expa…

Excerpt shortened here; the source contains the full paragraph.

Current wording

On July 6, 2024, certain wholly owned subsidiaries (“Second Amended Credit Facility Secured Subsidiaries”) of the Company entered into a second amendment to the Credit Facility Loan Agreement (collectively, the “Second Amended Credit Facility Loan Agreement”) between the Second Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Second Amended Credit Facility Lender”). Under the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Secured Subsidiaries may borrow from the Second Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Second Amended Credit Facility Promissory Note”). The Second Amended Credit Facility Promissory Note bears an interest rate equal to 3% plus the greater of the One Month SOFR or 0.25% and is due to mature on July 6, 2027, with an option to extend the maturity to July 6, 2028. An annual unused facility fee is charged based on the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during the trailing twelve month period ending each June 30. The fee will be calculated at 0.25% per annum if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was greater than fifty percent, and will be calculated at 0.15% if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was less than or equal to fifty percent. The obligations under the Second Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Second Amended Credit Facility Secured Subsidiaries. The Company entered into a second amended and restated guaranty of payment as of July 6, 2024 (“Second Amended Credit Facility Guaranty,” and together with the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Promissory Note and related instruments, the “Second Amended Credit Facility Loan Documents”) to guarantee the payment to the Second Amended Credit Facility Lender of certain obligations of the Second Amended Credit Facility Secured Subsidiaries under the Second Amended Credit Facility Loan Agreement. The Company and the Second Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Second Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Second Amended Credit Facility Lender. As of September 30, 2024, we have no withdrawn proceeds under the Second Amended Credit Facility Loan Agreement. We currently intend to strategically withdraw proceeds available under the Second Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) ex…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further develop and expand our current stores. We did not complete any acquisitions in the three and six months ended June 30, 2024. In addition, we may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities. As of June 30, 2024, under our third-party management platform, Global MaxManagement SM, we managed one third-party owned property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma.

Current wording

We continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further develop and expand our current stores. We did not complete any acquisitions in the three and nine months ended September 30, 2024. In addition, we may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities. As of September 30, 2024, under our third-party management platform, Global MaxManagement SM, we managed one third-party owned property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma.

Previous wording

We expect we will have sufficient cash from current sources to meet our liquidity needs for the next twelve months because our capital resources currently exceed our projected expenses for the next twelve months. However, we may opt to supplement our equity capital and increase potential returns to our stockholders through the use of prudent levels of borrowings. We may use debt when the available terms and conditions are favorable to long-term investing and well-aligned with our business plan.

Current wording

We expect we will have sufficient cash from current sources to meet our liquidity needs for the next twelve months because our capital resources currently exceed our projected expenses for the next twelve months. However, we may opt to supplement our equity capital and increase potential returns to our stockholders through the use of prudent levels of borrowings. We may use debt when the available terms and conditions are favorable to long-term investing and well-aligned with our strategic business plan.

Previous wording

The Company currently has capital resources totaling approximately $24.8 million, comprised of $7.1 million of cash, cash equivalents, and restricted cash and $2.7 million of marketable securities as of June 30, 2024, and $15 million available for withdrawal under the Second Amended Credit Facility Loan Agreement which matures on July 6, 2027. Capital resources derived from retained cash flow have been and are currently expected to continue to be negligible. Retained operating cash flow represents our expected cash flow provided by operating activities, less stockholder distributions and capital expenditures to maintain stores. These capital resources allow us to continue to execute our strategic business plan, which includes funding acquisitions, either directly or through joint ventures; expansion projects at our existing properties; and broadening our revenue base and pipeline of potential acquisitions through developing Global MaxManagement SM, our third-party management platform. Our board of directors regularly reviews our strategic business plan, including topics and metrices like capital formation, debt versus equity ratios, dividend policy, use of capital and debt, funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) performance, and optimal cash levels.

Current wording

The Company currently has capital resources totaling approximately $25.1 million, comprised of $6.9 million of cash, cash equivalents, and restricted cash and $3.2 million of marketable securities as of September 30, 2024, and $15 million available for withdrawal under the Second Amended Credit Facility Loan Agreement which matures on July 6, 2027. Capital resources derived from retained cash flow have been and are currently expected to continue to be negligible. Retained operating cash flow represents our expected cash flow provided by operating activities, less stockholder distributions and capital expenditures to maintain stores. These capital resources allow us to continue to execute our strategic business plan, which includes funding acquisitions, either directly or through joint ventures; expansion projects at our existing properties; and broadening our revenue base and pipeline of potential acquisitions through developing Global MaxManagement SM, our third-party management platform. Our board of directors regularly reviews our strategic business plan, including topics and metrices like capital formation, debt versus equity ratios, dividend policy, use of capital and debt, funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) performance, and optimal cash levels. See the section titled "Non-GAAP Financial Measures" for the definition and use of FFO and AFFO.

Previous wording

We expect that the results of our operations will be affected by a number of factors. Many of the factors that will affect our operating results are beyond our control. The Company and its properties could be materially and adversely affected by the risks, or the public perception of the risks, related to, among other things, public health crises, natural disasters and geopolitical events, including the ongoing conflict between Russia, Belarus and Ukraine, the ongoing conflict between Israel and Hamas, financial and credit market volatility and disruptions, inflationary pressures, rising interest rates, supply chain issues, labor shortages and recessionary concerns.

Current wording

We expect that the results of our operations will be affected by a number of factors. Many of the factors that will affect our operating results are beyond our control. The Company and its properties could be materially and adversely affected by the risks, or the public perception of the risks, related to, among other things, public health crises, natural disasters and geopolitical events, including the ongoing conflict between Russia, Belarus and Ukraine, the ongoing conflict between Israel and Hamas, financial and credit market volatility and disruptions, inflationary pressures, rising interest rate fluctuations, supply chain issues, labor shortages and recessionary concerns.

Previous wording

Total revenues increased from $3,086,018 during the three months ended June 30, 2023 to $3,109,038 during the three months ended June 30, 2024, an increase of 0.7%, or $23,020. Rental income increased from $2,965,178 during the three months ended June 30, 2023 to $2,983,039 during the three months ended June 30, 2024, an increase of 0.6%, or $17,861. The increase was primarily attributable to increases in occupancy and existing tenant rates under our proprietary revenue rate management program, which was partially offset by lower move-in rental rates year-over-year across the United States and in the markets that we operate.

Current wording

Total revenues increased from $3,090,374 during the three months ended September 30, 2023 to $3,200,276 during the three months ended September 30, 2024, an increase of 3.6%, or $109,902. Rental income increased from $2,968,263 during the three months ended September 30, 2023 to $3,070,871 during the three months ended September 30, 2024, an increase of 3.5%, or $102,608. The increase was primarily attributable to increases in occupancy and existing tenant rates under our proprietary revenue rate management program, which was partially offset by lower move-in rental rates year-over-year across the United States and in the markets that we operate.

Previous wording

Other store related income consists of tenant insurance fees, sales of storage supplies, and other ancillary revenues. Other store related income increased from $98,375 during the three months ended June 30, 2023 to $108,489 during the three months ended June 30, 2024, an increase of 10.3%, or $10,114. The increase was primarily attributable to additional tenants subscribing to tenant insurance.

Current wording

Other property related income consists of tenant insurance fees, sales of storage supplies, and other ancillary revenues. Other property related income increased from $103,676 during the three months ended September 30, 2023 to $111,618 during the three months ended September 30, 2024, an increase of 7.7%, or $7,942. The increase was primarily attributable to additional tenants subscribing to tenant insurance.

Previous wording

Income from our third-party management platform consists of management fees and customer insurance fees. Management fees and other income decreased from $22,465 during the three months ended June 30, 2023 to $17,510 during the three months ended June 30, 2024. The decrease was primarily attributable to the adjustment of fees for our third-party management services in accordance with current market rates.

Current wording

Income from our third-party management platform consists of management fees and customer insurance fees. Management fees and other income decreased from $18,435 during the three months ended September 30, 2023 to $17,787 during the three months ended September 30, 2024. The decrease was primarily attributable to the adjustment of fees for our third-party management services in accordance with current market rates.

Previous wording

Total operating expenses increased from $4,521,278 during the six months ended June 30, 2023 to $4,916,174 during the six months ended June 30, 2024, an increase of 8.7%, or $394,896, which was primarily attributable to an increase in store level expenses and general and administrative expenses. Store operating expenses increased from $2,211,315 during the six months ended June 30, 2023 to $2,402,285 during the six months ended June 30, 2024, an increase of 8.6%, or $190,970. The increase in store operating expenses was due primarily to increased expenses for employment costs, property insurance, and real estate property taxes.

Current wording

Total operating expenses increased from $2,261,841 during the three months ended September 30, 2023 to $2,327,186 during the three months ended September 30, 2024, an increase of 2.9%, or $65,345, which was attributable to an increase in general and administrative expenses. Store operating expenses decreased from $1,163,064 during the three months ended September 30, 2023 to $1,153,947 during the three months ended September 30, 2024, a decrease of 0.8%, or $9,117.

Previous wording

General and administrative expenses increased from $809,623 during the three months ended June 30, 2023 to $892,822 during the three months ended June 30, 2024, an increase of 10.3%, or $83,199. The increase in general and administrative expenses during this period are primarily attributable to increased professional fees and employment costs.

Current wording

General and administrative expenses increased from $683,629 during the three months ended September 30, 2023 to $762,000 during the three months ended September 30, 2024, an increase of 11.5%, or $78,371. The increase in general and administrative expenses during this period are primarily attributable to increased professional fees and employment costs.

Previous wording

Business development which includes capital raising, store acquisition, and third-party management marketing expenses was $0 during the three months ended June 30, 2023 and during the three months ended June 30, 2024. These costs primarily consist of costs incurred in connection with business development, capital raising, and future potential store acquisitions, and third-party management marketing expenses. Business development costs are typically non-recurring and fluctuate based on periodic business development and acquisition activity.

Current wording

Business development which includes capital raising, store acquisition, and third-party management marketing expenses decreased from $5,903 during the three months ended September 30, 2023 to $2,012 during the three months ended September 30, 2024, a decrease of 65.9%, or $3,891. These costs primarily consist of costs incurred in connection with business development, capital raising, and future potential store acquisitions, and third-party management marketing expenses. Business development costs are typically non-recurring and fluctuate based on periodic business development and acquisition activity.

Previous wording

As a result of the operating effects noted above, operating income decreased from $1,602,693 during the six months ended June 30, 2023 to $1,226,904 during the six months ended June 30, 2024, a decrease of 23.4%, or $375,789.

Current wording

As a result of the operating effects noted above, operating income increased from $828,533 during the three months ended September 30, 2023 to $873,090 during the three months ended September 30, 2024, an increase of 5.4%, or $44,557.

Previous wording

Interest expense on debt increased from $170,951 during the three months ended June 30, 2023 to $211,361 during the three months ended June 30, 2024. This increase was attributable to the change in fair value of the interest rate cap. The cash payments for the $20 million Term Loan Agreement remain the same every month until June 2036 and are $107,699 per month.

Current wording

Interest expense on debt increased from $212,712 during the three months ended September 30, 2023 to $259,419 during the three months ended September 30, 2024. This increase was attributable to the change in fair value of the interest rate cap and the decrease in cash settlements under the interest rate cap. The cash payments for the $20 million Term Loan Agreement remain the same every month until June 2036 and are $107,699 per month.

Previous wording

Dividend, interest, and other income was $86,488 during the three months ended June 30, 2023 and $87,450 during the three months ended June 30, 2024.

Current wording

Dividend, interest, and other income was $66,906 during the three months ended September 30, 2023 and $68,703 during the three months ended September 30, 2024.

Previous wording

Unrealized loss on marketable equity securities was $115,347 during the three months ended June 30, 2023 and the unrealized gain on marketable equity securities was $79,530 during the three months ended June 30, 2024.

Current wording

Unrealized loss on marketable equity securities was $411,969 during the three months ended September 30, 2023 and the unrealized gain on marketable equity securities was $499,283 during the three months ended September 30, 2024.

Previous wording

For the three months ended June 30, 2023, net income was $578,070, or $0.05 per fully diluted share. For the three months ended June 30, 2024, net income was $591,530, or $0.05 per fully diluted share.

Current wording

For the three months ended September 30, 2023, net income was $270,758, or $0.02 per fully diluted share. For the three months ended September 30, 2024, net income was $1,181,657, or $0.10 per fully diluted share.

Previous wording

Results of Operations for the Six Months Ended June 30, 2024 Compared with the Six Months Ended June 30, 2023

Current wording

Results of Operations for the Nine Months Ended September 30, 2024 Compared with the Nine Months Ended September 30, 2023

Previous wording

Total revenues increased from $6,123,971 during the six months ended June 30, 2023 to $6,143,078 during the six months ended June 30, 2024, an increase of 0.3%, or $19,107. Rental income increased from $5,889,582 during the six months ended June 30, 2023 to $5,896,500 during the six months ended June 30, 2024, an increase of 0.1%, or $6,918. The increase was primarily attributable to increases in existing tenant rates under our revenue rate management program.

Current wording

Total revenues increased from $9,214,345 during the nine months ended September 30, 2023 to $9,343,354 during the nine months ended September 30, 2024, an increase of 1.4%, or $129,009. Rental income increased from $8,857,845 during the nine months ended September 30, 2023 to $8,967,371 during the nine months ended September 30, 2024, an increase of 1.2%, or $109,526. The increase was primarily attributable to increased occupancies and increases in existing tenant rates under our revenue rate management program.

Previous wording

Other store related income consists of customer insurance fees, sales of storage supplies, and other ancillary revenues. Other store related income increased from $190,112 during the six months ended June 30, 2023 to 212,339 during the six months ended June 30, 2024, an increase of 11.7%, or $22,227. The increase was primarily attributable to additional tenants subscribing to tenant insurance.

Current wording

Other property related income consists of customer insurance fees, sales of storage supplies, and other ancillary revenues. Other property related income increased from $293,788 during the nine months ended September 30, 2023 to $323,957 during the nine months ended September 30, 2024, an increase of 10.3%, or $30,169. The increase was primarily attributable to additional tenants subscribing to tenant insurance.

Previous wording

Income from our third-party management platform consists of management fees and customer insurance fees. Management fees and other income decreased from $44,277 during the six months ended June 30, 2023 to $34,239 during the six months ended June 30, 2024. The decrease was primarily attributable to the adjustment of fees for our third-party management services in accordance with current market rates.

Current wording

Income from our third-party management platform consists of management fees and customer insurance fees. Management fees and other income decreased from $62,712 during the nine months ended September 30, 2023 to $52,026 during the nine months ended September 30, 2024. The decrease was primarily attributable to the adjustment of fees for our third-party management services in accordance with current market rates.

Previous wording

Total operating expenses increased from $2,308,138 during the three months ended June 30, 2023 to $2,473,127 during the three months ended June 30, 2024, an increase of 7.1%, or $164,989, which was attributable to an increase in store level expenses and general and administrative expenses. Store operating expenses increased from $1,089,977 during the three months ended June 30, 2023 to $1,171,169 during the three months ended June 30, 2024, an increase of 7.4%, or $81,192. The increase in store operating expenses was due primarily to increased expenses for employment costs and property insurance.

Current wording

Total operating expenses increased from $6,783,120 during the nine months ended September 30, 2023 to $7,243,360 during the nine months ended September 30, 2024, an increase of 6.8%, or $460,240, which was primarily attributable to an increase in store level expenses and general and administrative expenses. Store operating expenses increased from $3,374,379 during the nine months ended September 30, 2023 to $3,556,232 during the nine months ended September 30, 2024, an increase of 5.4%, or $181,853. The increase in store operating expenses was due primarily to increased expenses for employment costs and property insurance.

Previous wording

General and administrative expenses increased from $1,489,335 during the six months ended June 30, 2023 to $1,695,550 during the six months ended June 30, 2024, an increase of 13.8%, or $206,215. The increase in general and administrative expenses during this period are primarily attributable to increased professional fees and employment costs.

Current wording

General and administrative expenses increased from $2,172,965 during the nine months ended September 30, 2023 to $2,457,551 during the nine months ended September 30, 2024, an increase of 13.1%, or $284,586. The increase in general and administrative expenses during this period are primarily attributable to increased professional fees and employment costs.

Previous wording

Depreciation and amortization increased from $815,379 during the six months ended June 30, 2023 to $816,064 during the six months ended June 30, 2024, an increase of 0.1%, or $684.

Current wording

Depreciation and amortization increased from $1,224,624 during the nine months ended September 30, 2023 to $1,225,290 during the nine months ended September 30, 2024, an increase of 0.1%, or $666.

Previous wording

Business development, capital raising, store acquisition, and third-party management marketing expenses decreased from $5,249 during the six months ended June 30, 2023 to $2,275 during the six months ended June 30, 2024. These costs primarily consist of costs incurred in connection with business development, capital raising, and future potential store acquisitions, and third-party management marketing expenses. Business development costs are typically non-recurring and fluctuate based on periodic business development and acquisition activity.

Current wording

Business development, capital raising, store acquisition, and third-party management marketing expenses decreased from $11,152 during the nine months ended September 30, 2023 to $4,287 during the nine months ended September 30, 2024. These costs primarily consist of costs incurred in connection with business development, capital raising, and future potential store acquisitions, and third-party management marketing expenses. Business development costs are typically non-recurring and fluctuate based on periodic business development and acquisition activity.

Previous wording

As a result of the operating effects noted above, operating income decreased from $777,880 during the three months ended June 30, 2023 to $635,911 during the three months ended June 30, 2024, a decrease of 18.3%, or $141,969.

Current wording

As a result of the operating effects noted above, operating income decreased from $2,431,225 during the nine months ended September 30, 2023 to $2,099,994 during the nine months ended September 30, 2024, a decrease of 13.6%, or $331,231.

Previous wording

Interest expense on debt increased from $406,839 during the six months ended June 30, 2023 to $416,203 during the six months ended June 30, 2024. This increase was attributable to the change in fair value of the interest rate cap partially offset by cash settlements under the interest rate cap from the difference between the reference interest rate and the strike rate and lower interest payments under the Term Loan Agreement. The cash payments for the $20 million Term Loan Agreement remain the same every month until June 2036 and are $107,699 per month.

Current wording

Interest expense on debt increased from $619,550 during the nine months ended September 30, 2023 to $675,622 during the nine months ended September 30, 2024. This increase was attributable to the change in fair value of the interest rate cap partially offset by cash settlements under the interest rate cap from the difference between the reference interest rate and the strike rate and lower interest payments under the Term Loan Agreement. The cash payments for the $20 million Term Loan Agreement remain the same every month until June 2036 and are $107,699 per month.

Previous wording

Dividend, interest, and other income was $128,054 during the six months ended June 30, 2023 and $142,327 during the six months ended June 30, 2024. The increase was attributable to the dividends earned on money market mutual fund balances.

Current wording

Dividend, interest, and other income was $194,960 during the nine months ended September 30, 2023 and $211,030 during the nine months ended September 30, 2024. The increase was attributable to the dividends earned on money market mutual fund balances.

Previous wording

Unrealized gain on marketable equity securities was $246,703 during the six months ended June 30, 2023 and the unrealized loss on marketable equity securities was $95,348 during the six months ended June 30, 2024.

Current wording

Unrealized loss on marketable equity securities was $165,266 during the nine months ended September 30, 2023 and the unrealized gain on marketable equity securities was $403,935 during the nine months ended September 30, 2024.

Previous wording

For the six months ended June 30, 2023, net income was $1,570,611, or $0.14 per fully diluted share. For the six months ended June 30, 2024, net income was $857,680, or $0.08 per fully diluted share.

Current wording

For the nine months ended September 30, 2023, net income was $1,841,369, or $0.16 per fully diluted share. For the nine months ended September 30, 2024, net income was $2,039,337, or $0.18 per fully diluted share.

Previous wording

Distributions for each of the three months ended June 30, 2024 and 2023 were $0.0725 per share. The Company’s closing market price as of June 30, 2024 and June 30, 2023 was $4.86 and $5.05, respectively. Past market price performance and distribution levels do not guarantee similar results in the future.

Current wording

Distributions for each of the three months ended September 30, 2024 and 2023 were $0.0725 per share. The Company’s closing market price as of September 30, 2024 and September 30, 2023 was $5.21 and $4.86, respectively. Past market price performance and distribution levels do not guarantee similar results in the future.

Previous wording

The following discussion and analysis of our same-store self storage operations are presented on a comparative basis for the six months ended June 30, 2024.

Current wording

The following discussion and analysis of our same-store self storage operations are presented on a comparative basis for the nine months ended September 30, 2024.

Previous wording

Certain stores’ leasable square feet in the chart above includes outside auto/RV/boat storage space: approximately 12,800 square feet at SSG Sadsbury LLC; 6,300 square feet at SSG Fishers LLC; 15,700 square feet at SSG Bolingbrook LLC; 8,900 square feet at SSG Dolton LLC; 2,100 square feet at SSG Merrillville LLC; 3,800 square feet at SSG Summerville I LLC; 8,000 square feet at SSG Summerville II LLC and 8,800 square feet at SSG Clinton LLC. For SSG Lima LLC, included is approximately 3,800 square feet of non-storage commercial and student housing space. For SSG Millbrook LLC, included is approximately 1,300 square feet of wine storage and non-storage office space. For SSG Fishers LLC, included is approximately 300 square feet of storage locker space. Approximately 33% of our total available units are climate-controlled, 59% are traditional drive-up storage, and 8% are outdoor parking storage for boats, cars and recreational vehicles.

Current wording

SSG Dolton LLC; 2,100 square feet at SSG Merrillville LLC; 3,800 square feet at SSG Summerville I LLC; 8,000 square feet at SSG Summerville II LLC and 8,800 square feet at SSG Clinton LLC. For SSG Lima LLC, included is approximately 3,800 square feet of non-storage commercial and student housing space. For SSG Millbrook LLC, included is approximately 1,300 square feet of wine storage and non-storage office space. For SSG Fishers LLC, included is approximately 300 square feet of storage locker space. Approximately 33% of our total available units are climate-controlled, 59% are traditional drive-up storage, and 8% are outdoor parking storage for boats, cars and recreational vehicles.

Previous wording

Same-store occupancy at June 30, 2024 increased by 2.5% to 93.0% from 90.5% at June 30, 2023. As of July 31, 2024, occupancy at the Company’s same-store properties was 94.2%.

Current wording

Same-store occupancy at September 30, 2024 increased by 1.7% to 91.5% from 89.8% at September 30, 2023.

Previous wording

Same-store revenues increased by 0.9% and 0.5% for the three and six months ended June 30, 2024 versus the same periods in 2023. Same-store cost of operations increased by 7.4% and 8.6% for the three and six months ended June 30, 2024 versus the same periods in 2023. Same-store NOI decreased by 2.7% and 4.2% for the three and six months ended June 30, 2024 versus the same periods in 2023. The decrease in same-store NOI during the three months ended June 30, 2024 was due primarily to more muted revenue growth and increased cost of operations.

Current wording

Same-store revenues increased by 3.6% and 1.5% for the three and nine months ended September 30, 2024 versus the same periods in 2023. Same-store cost of operations decreased by 0.8% and increased 5.4% for the three and nine months ended September 30, 2024 versus the same periods in 2023. Same-store NOI increased by 6.3% and decreased 0.7% for the three and nine months ended September 30, 2024 versus the same periods in 2023. The increase in same-store NOI during the three months ended September 30, 2024 was due primarily to an increase in revenues and decrease in cost of operations.

Previous wording

We believe that our results were driven by, among other things, our internet and digital marketing initiatives which helped maintain our overall average same-store occupancy of approximately 93% as of June 30, 2024. Also, contributing to our results were our customer service efforts which we believe were essential in building local brand loyalty, resulting in strong referral and word-of-mouth market demand for our storage units and services. Another contributing factor to our results was our competitor move-in rate metrics analysis which employs internet data scraping and other methods to help keep our storage unit move-in rates “in the market,” and our revenue rate management program which helped increase existing tenant rates while optimizing store occupancy.

Current wording

We believe that our results were driven by, among other things, our internet and digital marketing initiatives which helped maintain our overall average same-store occupancy of approximately 92% as of September 30, 2024. Also, contributing to our results were our customer service efforts which we believe were essential in building local brand loyalty, resulting in strong referral and word-of-mouth market demand for our storage units and services. Another contributing factor to our results was our competitor move-in rate metrics analysis which employs internet data scraping and other methods to help keep our storage unit move-in rates “in the market,” and our revenue rate management program which helped increase existing tenant rates while optimizing store occupancy.

Previous wording

For the three and six months ended June 30, 2024, same-store revenue increased 0.9%, or $27,975, and 0.5%, or $29,145, respectively, versus the same periods in 2023. Same-store average overall square foot occupancy for all of the Company’s same-store properties increased to 93.0% at June 30, 2024, up from 90.5% at June 30, 2023. As of July 31, 2024, occupancy at the Company’s same-store properties was 94.2%.

Current wording

For the three and nine months ended September 30, 2024, same-store revenue increased 3.6%, or $110,550, and 1.5%, or $139,695, respectively, versus the same periods in 2023. Same-store average overall square foot occupancy for all of the Company’s same-store properties increased to 91.5% at September 30, 2024, up from 89.8% at September 30, 2023.