Extra Space Storage Inc.

Previous wording

As of June 30, 2025, we owned or had ownership interests in 2,430 operating stores. Of these stores, 2,005 are wholly-owned, 11 are in consolidated joint ventures, and 414 are in unconsolidated joint ventures. In addition, we managed an additional 1,749 stores for third parties bringing the total number of stores which we own and/or manage to 4,179. These stores are located in 43 states and Washington, D.C. The majority of our stores are clustered around large population centers. The clustering of assets around these population centers enables us to reduce our operating costs through economies of scale. Our acquisitions have given us an increased scale in many core markets as well as a foothold in many markets where we had no previous presence.

Current wording

As of September 30, 2025, we owned or had ownership interests in 2,427 operating stores. Of these stores, 2,005 are wholly-owned, 11 are in consolidated joint ventures, and 411 are in unconsolidated joint ventures. In addition, we managed an additional 1,811 stores for third parties bringing the total number of stores which we own and/or manage to 4,238. These stores are located in 43 states and Washington, D.C. The majority of our stores are clustered around large population centers. The clustering of assets around these population centers enables us to reduce our operating costs through economies of scale. Our acquisitions have given us an increased scale in many core markets as well as a foothold in many markets where we had no previous presence.

Previous wording

As of June 30, 2025, approximately 2,465,000 tenants were leasing storage units at the operating stores that we own and/or manage, primarily on a month-to-month basis, providing the flexibility to increase rental rates over time as market conditions permit. Existing tenants generally receive rate increases at least annually, for which no direct correlation has been drawn to our vacancy trends. Although leases are short-term in duration, the typical tenant tends to remain at our stores for an extended period of time. For same-stores as of June 30, 2025, the average length of stay for tenants who have vacated was approximately 17.1 months.

Current wording

As of September 30, 2025, approximately 2,460,000 tenants were leasing storage units at the operating stores that we own and/or manage, primarily on a month-to-month basis, providing the flexibility to increase rental rates over time as market conditions permit. Existing tenants generally receive rate increases at least annually, for which no direct correlation has been drawn to our vacancy trends. Although leases are short-term in duration, the typical tenant tends to remain at our stores for an extended period of time. For same-stores as of September 30, 2025, the average length of stay for tenants who have vacated was approximately 17.0 months.

Previous wording

Comparison of the three and six months ended June 30, 2025 and 2024

Current wording

Comparison of the three and nine months ended September 30, 2025 and 2024

Previous wording

Results for the three and six months ended June 30, 2025 included the operations of 2,430 stores (2,005 wholly-owned, 11 in consolidated joint ventures, and 414 in joint ventures accounted for using the equity method) compared to the results for the three and six months ended June 30, 2024, which included the operations of 2,389 stores (1,912 wholly-owned, five in consolidated joint ventures, and 472 in joint ventures accounted for using the equity method).

Current wording

Results for the three and nine months ended September 30, 2025 included the operations of 2,427 stores (2,005 wholly-owned, 11 in consolidated joint ventures, and 411 in joint ventures accounted for using the equity method) compared to the results for the three and nine months ended September 30, 2024, which included the operations of 2,401 stores (1,934 wholly-owned, seven in consolidated joint ventures, and 460 in joint ventures accounted for using the equity method).

Previous wording

Property rental—The increase in property rental revenues for the three and six months ended June 30, 2025 was primarily the result of an increase of $30,049 and $47,591, respectively, associated with acquisitions completed in 2024 and acquisitions completed in the first six months of 2025. The increase in revenue resulting from these acquisitions was partially offset by decreases in rental revenue of $6,027 and $10,663, respectively, due to property dispositions for the three and six months ended June 30, 2025. We acquired 58 wholly-owned stores in 2024 and an additional 45 wholly-owned stores during the six months ended June 30, 2025.

Current wording

Property rental—The increase in property rental revenues for the three and nine months ended September 30, 2025 was primarily the result of an increase of $32,063 and $78,672, respectively, associated with acquisitions completed in 2024 and acquisitions completed in the first nine months of 2025. The increase in revenue resulting from these acquisitions was partially offset by decreases in rental revenue of $5,882 and $15,601, respectively, due to property dispositions for the three and nine months ended September 30, 2025. We acquired 58 wholly-owned stores and disposed of six wholly-owned stores in 2024, and we acquired 46 wholly-owned stores and disposed of 12 wholly-owned stores during the nine months ended September 30, 2025.

Previous wording

Tenant reinsurance—The increase in tenant reinsurance revenues was due primarily to an increase in the number of stores operated. We operated 4,179 stores at June 30, 2025 compared to 3,812 stores at June 30, 2024.

Current wording

Tenant reinsurance—The increase in tenant reinsurance revenues was due primarily to an increase in the number of stores operated. We operated 4,238 stores at September 30, 2025 compared to 3,862 stores at September 30, 2024.

Previous wording

Management fees and other income—Management fees and other income primarily represent the fees collected for our management of stores owned by third parties and unconsolidated joint ventures and other transaction fee income. The increase for the three and six months ended June 30, 2025 was due to both an increase in the number of stores managed and an increase in the overall revenue of stores under management when compared to the same period last year. As of June 30, 2025, we managed 2,163 stores for unconsolidated joint ventures and third parties, compared to 1,895 stores as of June 30, 2024.

Current wording

Management fees and other income—Management fees and other income primarily represent the fees collected for our management of stores owned by third parties and unconsolidated joint ventures and other transaction fee income. The increase for the three and nine months ended September 30, 2025 was due to both an increase in the number of stores managed and an increase in the overall revenue of stores under management when compared to the same period last year. As of September 30, 2025, we managed 2,222 stores for unconsolidated joint ventures and third parties, compared to 1,921 stores as of September 30, 2024.

Previous wording

Property operations—The increase in property operations expense during the three and six months ended June 30, 2025 consists primarily of an increase of $14,612 and $24,624, respectively, related to acquisitions completed in 2024 and acquisitions completed in the first six months of 2025. We acquired 58 wholly-owned stores in 2024 and an additional 45 wholly-owned stores during the six months ended June 30, 2025. Additionally, for the three and six months ended June 30,

Current wording

Property operations—The increase in property operations expense during the three and nine months ended September 30, 2025 consists primarily of an increase of $14,738 and $38,855, respectively, related to acquisitions completed in 2024 and acquisitions completed in the first nine months of 2025. We acquired 58 wholly-owned stores in 2024 and an additional 46 wholly-owned stores during the nine months ended September 30, 2025. Additionally, for the three and nine months ended September 30, 2025, there was an increase of $9,184 and $31,215, respectively, at our same-store properties primarily due to an increase in payroll and benefits, marketing, repairs and maintenance, and property tax expenses.

Previous wording

General and administrative—General and administrative expenses primarily include all expenses not directly related to our stores, including corporate payroll, office expense, office rent, travel and professional fees. These expenses are recognized as incurred. Our overall general and administrative expense has increased primarily as a result of our increased size through acquisitions and growth through our joint venture partners and managed portfolio.

Current wording

General and administrative—General and administrative expenses primarily include all expenses not directly related to our stores, including corporate payroll, office expense, office rent, travel and professional fees. These expenses are recognized as incurred. Our overall general and administrative expense increased primarily as a result of our increased size through acquisitions and growth in our managed portfolio.

Previous wording

Depreciation and amortization—The company amortizes to expense intangible assets-customer intangibles on a straight-line basis over the average period that a tenant is expected to utilize the facility (currently estimated at 18 months). Depreciation and amortization expense decreased for both the three and six month periods, due to the customer intangibles associated with our merger with Life Storage being fully expensed in January of this year.

Current wording

Depreciation and amortization—We amortize to expense intangible assets-customer intangibles on a straight-line basis over the average period that a tenant is expected to utilize the facility (currently estimated at 18 months). Depreciation and amortization expense decreased for both the three and nine month periods, primarily due to the customer intangibles associated with our merger with Life Storage being fully expensed in January of this year.

Previous wording

Gain on real estate assets held for sale and sold, net—We completed the sale of 12 previously held for sale stores during the six months ended June 30, 2025 resulting in a gain of $38,656 which was partially offset by losses of $3,759. The loss of $3,759 related to the sale of three land parcels and three properties listed for sale during the six months ended June 30, 2025 where the estimated fair value, net of selling costs, was less than the net carrying value of the assets. The loss recorded during the three months ended June 30, 2025 related to the sale of one operating property previously listed as held for sale resulting in an additional loss of $864. During the three months ended June 30, 2024, we listed seven properties for sale. These properties were recorded at current fair value less selling costs which resulted in an estimated loss of $54,659.

Current wording

Loss on real estate assets held for sale and sold, net—As of September 30, 2025, we had 29 properties classified as held for sale. Of the 29 stores, 27 had an estimated fair value, net of selling costs, less than the carrying value of the assets. During the three and nine months ended September 30, 2025, we recorded estimated net losses of $105,128 and $108,887, respectively. Additionally, we completed the sale of 12 previously held for sale stores, resulting in a net gain of $38,656, which partially offset the loss recorded for the nine months ended September 30, 2025. As of September 30, 2024, we had 17 stores classified as held for sale. Of the 17 stores, nine had an estimated fair value, net of selling costs, less than the carrying value of the assets. During the three and nine months ended September 30, 2024, we recorded estimated losses of $8,961 and $63,620, respectively.

Previous wording

Interest expense—The increase in interest expense during the three and six months ended June 30, 2025 was primarily the result of higher outstanding debt. As of June 30, 2025, we had approximately $13,169,719 in total face value of debt, compared to approximately $11,803,723 as of June 30, 2024.

Current wording

Interest expense—The increase in interest expense during the three and nine months ended September 30, 2025 was primarily the result of higher outstanding debt. As of September 30, 2025, we had approximately $13,162,058 in total face value of debt, compared to approximately $11,827,208 as of September 30, 2024.

Previous wording

Non-cash interest expense related to amortization of discount on unsecured senior notes, net—Represents the amortization of the discount assigned to the fair value of the Life Storage unsecured senior notes assumed as part of the Life Storage Merger and net premium from bond offerings, offset by discount from assumed debt.

Current wording

Non-cash interest expense related to amortization of discount on unsecured senior notes, net—Represents the amortization of the discount assigned to the fair value of the Life Storage unsecured senior notes assumed as part of the Life Storage Merger and net premium from bond offerings, offset by the discount from assumed debt.

Previous wording

Interest income—Interest income represents interest earned on variable interest rate bridge loans, debt securities and on notes receivable from Common Operating Partnership unit holders. The increase in interest income during the three and six months ended June 30, 2025 was primarily the result of an increase in the amount of bridge loans outstanding. The balance of bridge loans was $1,542,693 as of June 30, 2025, compared to $1,136,306 as of June 30, 2024.

Current wording

Interest income—Interest income represents interest earned on variable interest rate bridge loans, debt securities and on notes receivable from Common Operating Partnership unit holders. The increase in interest income during the three and nine months ended September 30, 2025 was primarily the result of an increase in the amount of bridge loans outstanding. The balance of bridge loans was $1,544,719 as of September 30, 2025, compared to $1,032,244 as of September 30, 2024.

Previous wording

Equity in earnings and dividend income from unconsolidated real estate entities—Equity in earnings of unconsolidated real estate entities represents the income earned through our ownership interests in unconsolidated joint ventures. In these joint ventures, we and our joint venture partners generally receive a preferred return on our invested capital. To the extent that cash or profits in excess of these preferred returns are generated, we receive a higher percentage of the excess cash or profits. The increase for the six months ended June 30, 2025 is primarily due to the transaction in November 2024 in which we acquired additional ownership interest in the HF1 Sovran HHF Storage Holdings LLC and HF2 Sovran HHF Storage Holdings II LLC from our partner in the unconsolidated joint ventures. The transaction increased our equity ownership percentages from 20% and 15%, respectively, to 49% in each unconsolidated joint venture. The decrease for the three months ended June 30, 2025 is primarily due to the acquisition of our partners’ membership interests in the ESS-NYFL JV LP and ESS CA-TIVS JV LP joint ventures, as well as the transfer and distribution of membership interests in the PR II EXR JV LLC joint venture. The number of unconsolidated joint ventures in which we have ownership interests was 414 as of June 30, 2025, compared to 472 as of June 30, 2024. Dividend income represents dividends from our investment in preferred stock of SmartStop and its affiliates.

Current wording

Equity in earnings and dividend income from unconsolidated real estate entities—Equity in earnings of unconsolidated real estate entities represents the income earned through our ownership interests in unconsolidated joint ventures. In these joint ventures, we and our joint venture partners generally receive a preferred return on our invested capital. To the extent that cash or profits in excess of these preferred returns are generated, we receive a higher percentage of the excess cash or profits. The increase for the nine months ended September 30, 2025 is primarily due to the transaction in November 2024 in which we acquired additional ownership interest in the HF1 Sovran HHF Storage Holdings LLC and HF2 Sovran HHF Storage Holdings II LLC from our partner in the unconsolidated joint ventures. The transaction increased our equity ownership percentages from 20% and 15%, respectively, to 49% in each unconsolidated joint venture. The decrease for the three months ended September 30, 2025 is primarily due to the transfer and distribution of membership interests in the PR II EXR JV LLC joint venture in March 2025, the acquisition of our partners’ membership interests in the ESS-NYFL JV LP and ESS CA-TIVS JV LP joint ventures in April 2025, and the sale of our membership interest in the Life Storage Spacemax LLC joint venture in July 2025. The number of stores in unconsolidated joint ventures in which we have ownership interests was 411 as of September 30, 2025, compared to 460 as of September 30, 2024. Dividend income represents dividends from our investment in preferred stock of SmartStop and its affiliates.

Previous wording

Income tax expense—The increase in income tax expense for the three and six months ended June 30, 2025 was primarily the result of an increase in book income and a decrease in permanent tax deductions related to stock awards.

Current wording

Income tax expense—The increase in income tax expense for the three and nine months ended September 30, 2025 was primarily the result of an increase in book income and a decrease in permanent tax deductions related to stock awards.

Previous wording

Cash flows from operating activities for the six months ended June 30, 2025 increased when compared to the same period in the prior year. Cash flows used in investing activities relate primarily to our acquisition and development of new stores, sales of stores, investments in unconsolidated real estate entities, and notes receivable from bridge loans and fluctuate depending on our actions in those areas. Cash flows from financing activities depend primarily on our debt and equity financing activities. A summary of cash flows along with significant components are as follows:

Current wording

Cash flows from operating activities for the nine months ended September 30, 2025 increased when compared to the same period in the prior year. Cash flows used in investing activities relate primarily to our acquisition and development of new stores, sales of stores, investments in unconsolidated real estate entities, and notes receivable from bridge loans and fluctuate depending on our actions in those areas. Cash flows from financing activities depend primarily on our debt and equity financing activities. A summary of cash flows along with significant components are as follows:

Previous wording

We believe that cash flows generated by operations, along with our existing cash and cash equivalents, the availability of funds under our existing lines of credit, and our access to capital markets will be sufficient to meet all of our reasonably anticipated cash needs during the next twelve months. These cash needs include operating expenses, monthly debt service payments, recurring capital expenditures, acquisitions, funding for the bridge loan program, building redevelopments and expansions, distributions to unit holders and dividends to stockholders necessary to maintain our REIT qualification.

Current wording

We believe that cash flows generated by operations, along with our existing cash and cash equivalents, the availability of funds under our existing lines of credit, and our access to capital markets will be sufficient to meet all of our reasonably anticipated cash needs during the next twelve months. These cash needs include operating expenses, monthly debt service payments, acquisitions, funding for the bridge loan program, recurring capital expenditures, building redevelopments and expansions, distributions to unit holders and dividends to stockholders necessary to maintain our REIT qualification.

Previous wording

As of June 30, 2025, we had $125,045 available in cash and cash equivalents. Our cash and cash equivalents are held in accounts managed by third party financial institutions and consist of invested cash and cash in our operating accounts. During 2025 and 2024, we experienced no loss or lack of access to our cash and cash equivalents; however, there can be no assurance that access to our cash and cash equivalents will not be impacted by adverse conditions in the financial markets.

Current wording

As of September 30, 2025, we had $111,931 available in cash and cash equivalents. Our cash and cash equivalents are held in accounts managed by third party financial institutions and consist of invested cash and cash in our operating accounts. During 2025 and 2024, we experienced no loss or lack of access to our cash and cash equivalents; however, there can be no assurance that access to our cash and cash equivalents will not be impacted by adverse conditions in the financial markets.

Previous wording

In November 2024, we established our commercial paper program, under which we may issue, repay and re-issue short-term unsecured commercial paper notes. The aggregate principal amount outstanding under the program at any time cannot exceed $1,000,000, and the net proceeds of the commercial paper notes are expected to be used for general corporate purposes. The maturities of the notes generally range from overnight to three months, with a maximum of up to 13 months. The commercial paper notes are issued under customary terms in the commercial paper market and are issued at a discount from par or, alternatively, can be issued at par and bear varying interest rates on a fixed or floating basis. At any point in time, we expect to maintain available commitments under our Credit Facilities in an amount at least equal to the amount of commercial paper notes outstanding. At June 30, 2025, we had $700,000 in issuances outstanding under the commercial paper program.

Current wording

In November 2024, we established our commercial paper program, under which we may issue, repay and re-issue short-term unsecured commercial paper notes. The aggregate principal amount outstanding under the program at any time cannot exceed $1,000,000, and the net proceeds of the commercial paper notes are expected to be used for general corporate purposes. The maturities of the notes generally range from overnight to three months, with a maximum of up to 13 months. The commercial paper notes are issued under customary terms in the commercial paper market and are issued at a discount from par or, alternatively, can be issued at par and bear varying interest rates on a fixed or floating basis. At any point in time, we expect to maintain available commitments under our Credit Facilities in an amount at least equal to the amount of commercial paper notes outstanding. At September 30, 2025, we had $540,000 in issuances outstanding under the commercial paper program.

Previous wording

We hold a BBB+/Stable rating from S&P, which was upgraded from BBB/Stable in July 2023 in connection with the Life Storage Merger, and a Baa2/Positive rating from Moody's Investors Service. We intend to manage our balance sheet to maintain these ratings. Certain of our real estate assets are pledged as collateral for our debt. As of June 30, 2025, we had a total of 1,773 unencumbered stores as defined by our public bonds. Our unencumbered asset value was calculated as $30,214,990 and our total asset value was calculated as $36,039,197 according to the calculations as defined by our public bonds. We are subject to certain restrictive covenants relating to our outstanding debt. We were in compliance with all financial covenants at June 30, 2025.

Current wording

We hold a BBB+/Stable rating from S&P, which was upgraded from BBB/Stable in July 2023 in connection with the Life Storage Merger, and a Baa2/Positive rating from Moody’s Investors Service. We intend to manage our balance sheet to maintain these ratings. Certain of our real estate assets are pledged as collateral for our debt. As of September 30, 2025, we had a total of 1,786 unencumbered stores as defined by our public bonds. Our unencumbered asset value was calculated as $30,315,349 and our total asset value was calculated as $35,717,864 according to the calculations as defined by our public bonds. We are subject to certain restrictive covenants relating to our outstanding debt. We were in compliance with all financial covenants at September 30, 2025.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, which included certain modifications to U.S. tax law, including certain provisions that affect the taxation of REITs and their investors. The OBBBA permanently extended certain provisions that were enacted in the Tax Cuts and Jobs Act of 2017. Such extensions included the permanent extension of the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers. The OBBBA also increased the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries (the permissible value of taxable REIT subsidiary securities that a REIT may hold) from 20% to 25% of the value of the REIT’s total assets for taxable years beginning after December 31, 2025. We are currently evaluating the provisions of the OBBBA, but do not expect the OBBBA to have a material impact on our financial position and/or results of operations.

Current wording

On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted into law, which included certain modifications to U.S. tax law, including certain provisions that affect the taxation of REITs and their investors. The OBBBA permanently extended certain provisions that were enacted in the Tax Cuts and Jobs Act of 2017. Such extensions included the permanent extension of the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers. The OBBBA also increased the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries (the permissible value of taxable REIT subsidiary securities that a REIT may hold) from 20% to 25% of the value of the REIT’s total assets for taxable years beginning after December 31, 2025. We are currently evaluating the provisions of the OBBBA, but we do not expect the OBBBA to have a material impact on our financial position and/or results of operations.