What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-20 compared with 2025-02-28 · 84 added, 94 removed, 243 unchanged (42% of the section changed)

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For a discussion of such risk factors, see the section in this Form 10-K entitled “Risk Factors.” Dollar amounts are in thousands, except share and per share data, unless otherwise stated.

We are a fully integrated, self-administered and self-managed REIT, formed to own, operate, manage, acquire, develop and redevelop self-storage properties (“stores”).

We are a fully integrated, self-administered and self-managed REIT that owns, operates, manages, acquires, develops and redevelops self-storage properties (“stores”) and provides lending to owners of stores located throughout the United States.

We derive substantially all of our revenues from our two segments:

self-storage operations and tenant reinsurance.

Primary sources of revenue for our self-storage operations segment include rents received from tenants under leases at each of our wholly-owned stores.

Primary sources of revenue for our self-storage operations segment include rents received from tenants under leases at stores that are wholly-owned and in consolidated joint ventures.

Our operating results depend materially on our ability to lease available self-storage units, to actively manage unit rental rates, and on the ability of our tenants to make required rental payments.

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Revenue from our tenant reinsurance segment consists of insurance revenues from the reinsurance of risks relating to the loss of goods stored by tenants in our stores.

Our stores are generally situated in highly visible locations clustered around large population centers.

Our stores are generally situated in highly visible locations clustered around population centers.

The clustering of our assets around these population centers enables us to reduce our operating costs through economies of scale.

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Developed by our management team, these systems enable us to analyze, set and adjust rental rates daily across our portfolio in order to respond to changing market conditions.

We believe our systems and processes allow us to more pro-actively manage revenues.

We believe our systems and processes allow us to more proactively manage revenues.

We operate in competitive markets, often where consumers have multiple stores from which to choose.

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We believe that we are able to respond quickly and effectively to changes in local, regional and national economic conditions by adjusting rental rates through the combination of our revenue management team and our industry-leading technology systems.

We consider a store to be in the lease-up stage after it has been issued a certificate of occupancy, but before it has achieved stabilization.

We consider a store to be stabilized once it has achieved either an 80% occupancy rate for a full year measured as of January 1 of the current year, or has been open for three years prior to January 1 of the current year.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

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If the joint venture is determined to be a VIE, we perform a qualitative analysis, including considering which party, if any, has the power to direct the activities most significant to the economic performance of each VIE and whether that party has the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could be significant to the VIE.

If we are determined to be the primary beneficiary of the VIE, the assets, liabilities and operations of the VIE are consolidated within

our financial statements.

If we are determined to be the primary beneficiary of the VIE, the assets, liabilities and operations of the VIE are consolidated within our financial statements.

Otherwise, our investment is generally accounted for under the equity method.

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We review each store at least annually to determine if any such events or circumstances have occurred or exist.

We focus on stores where occupancy and/or rental income have decreased by a significant amount.

For these stores, we determine whether the decrease is temporary or permanent and whether the store will likely recover the lost occupancy and/or revenue in the short term.

In addition, we review stores in the lease-up stage and compare actual operating results to original projections.

We focus on stores that do not have positive cash flow.

For these stores, we determine whether the negative cash flow is temporary for lease-up stores or caused by other factors.

We may not have identified all material facts and circumstances that affect impairment of our stores.

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Otherwise, an impairment charge is recorded for the amount in which the carrying value of the reporting unit exceeds the fair value.

No impairments were recorded in our evaluations for any period presented herein.

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES:

We hold a number of derivative instruments which we use to hedge our exposure to variability in expected future cash flows, mainly related to our interest rates on variable interest debt.

We do not use derivatives for trading or speculative purposes.

We assess our derivatives both at inception and on an ongoing quarterly basis for whether the derivatives used in hedging transactions are effective.

The rules and interpretations relating to the accounting for derivatives are complex.

Failure to apply this guidance correctly may require us to recognize all changes in fair value of the hedged derivative in earnings, which may materially impact our results.

No impairments of goodwill were recorded in our evaluations for any period presented herein.

INCOME TAXES:

We have elected to be treated as a REIT under Sections 856 through 860 of the Internal Revenue Code.

In order to maintain our qualification as a REIT, among other requirements, we are required to distribute at least 90% of our REIT taxable income to our stockholders and meet certain tests regarding the nature of our income and assets.

In order to maintain our qualification as a REIT, among other requirements, we are required to distribute annually at least 90% of our REIT taxable income to our stockholders and meet certain tests regarding the nature of our income and assets.

As a REIT, we are not subject to U.S.

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RESULTS OF OPERATIONS

Amounts in thousands, except store and share data

Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024

Results for the year ended December 31, 2024 included the operations of 2,436 stores (1,967 wholly-owned, nine in consolidated joint ventures, and 460 in joint ventures accounted for using the equity method) compared to the results for the year ended December 31, 2023, which included the operations of 2,377 stores (1,903 wholly-owned, two in consolidated joint ventures, and 472 in joint ventures accounted for using the equity method).

Results for the year ended December 31, 2025 included the operations of 2,425 stores (2,007 wholly-owned, 11 in consolidated joint ventures, and 407 in joint ventures accounted for using the equity method) compared to the results for the year ended December 31, 2024, which included the operations of 2,436 stores (1,967 wholly-owned, nine in consolidated joint ventures, and 460 in joint ventures accounted for using the equity method).

Material or unusual changes in the results of our operations are discussed below:

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Total revenues $ 3,377,542 $ 3,256,902 $ 120,640 3.7 %

Property Rental— The increase in property rental revenue for the year ended December 31, 2024 was primarily the result of an increase of $570,407 associated with our merger with Life Storage on July 20, 2023, (the “Life Storage Merger” or “Merger”) and other acquisitions completed in 2023 and 2024.

We acquired 757 wholly-owned stores in the Merger and an additional 14 stores during the year ended December 31, 2023.

We acquired 58 stores during the year ended December 31, 2024.

The increase is also attributed to the Life Storage stores being on our platform for a full 12 months in 2024 in comparison with five months in 2023.

In addition to the increase attributable to the Merger, property rental revenue increased by $5,440 due to operating results at our same-store pool and increased by $4,892 as a result of increases in occupancy at our lease-up stores.

Tenant Reinsurance —The increase in tenant reinsurance revenue was due primarily to an increase in the number of stores operated, as well as the Life Storage stores being on our platform for a full 12 months in 2024 in comparison with five months in 2023.

Property rental— The increase in property rental revenue for the year ended December 31, 2025 was primarily the result of an increase of $104,706 associated with acquisitions completed in 2024 and 2025.

The increase in revenue resulting from these acquisitions was partially offset by a decrease in property rental revenue of $21,728 due to property dispositions over the same period.

We acquired 58 wholly-owned stores and disposed of six wholly-owned stores during the year ended December 31, 2024.

We acquired 76 wholly-owned stores and disposed of 37 wholly-owned stores during the year ended December 31, 2025.

In addition, property rental revenue increased by $8,755 due to improved operating results at our same-store properties.

Tenant reinsurance —The increase in tenant reinsurance revenue was due primarily to an increase in the number of stores operated.

We operated 4,281 stores at December 31, 2025, compared to 4,011 stores at December 31, 2024.

Management Fees and Other Income —Management fees and other income 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 year ended December 31, 2024 was primarily due to an increase in the number of stores managed.

As of December 31, 2024, we managed 2,044 stores for third parties and unconsolidated joint ventures, compared to 1,811 stores as of December 31, 2023.

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 year ended December 31, 2025 was primarily 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 December 31, 2025, we managed 1,856 stores for third party owners, compared to 1,575 stores as of December 31, 2024.

These increases are offset by a decrease in management fees attributable to stores in unconsolidated joint ventures, where the number of stores decreased from 460 to 407 over the same period.

The following table presents information on expenses for the years indicated:

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Tenant reinsurance 68,873 73,886 (5,013) (6.8) %

Life Storage Merger transition costs — 66,732 (66,732) (100.0) %

General and administrative 186,343 167,398 18,945 11.3 %

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Total expenses $ 1,888,541 $ 1,855,873 $ 32,668 1.8 %

Property Operations —The increase in property operations expense consists primarily of an increase of $186,294 associated with the Life Storage Merger and other acquisitions completed in 2023 and 2024.

We acquired 757 wholly-owned stores in the merger and an additional 14 stores during the year ended December 31, 2023.

We acquired 58 stores during the year ended December 31, 2024.

The increase is also attributed to the Life Storage stores being on our platform for a full 12 months in 2024 in comparison with five months in 2023.

Additionally, property operations expense increased $23,122 at our same-store pool due to increased marketing expense, payroll, and property taxes.

Tenant Reinsurance —Tenant reinsurance expense represents the costs that are incurred to provide tenant reinsurance.

The increase in tenant reinsurance expense for the year ended December 31, 2024 was due primarily to the increase in total number of stores operated compared to the prior year.

We operated 4,011 stores at December 31, 2024, compared to 3,714 stores at December 31, 2023.

Life Storage Merger Transition Costs— Represents the costs that were incurred as part of the Life Storage Merger primarily consisting of severance paid as part of employment agreements with certain employees and officers of Life Storage.

General and Administrative— General and administrative expenses primarily include all expenses not directly related to our stores, including corporate payroll, travel and professional fees.

Property operations —The increase in property operations expense consists primarily of an increase of $50,721 related to acquisitions completed in 2025 and 2024.

We acquired 58 wholly-owned stores in 2024 and 76 wholly-owned stores during the year ended December 31, 2025.

Additionally, for the year ended December 31, 2025, there was an increase of $35,689 at our same-store properties primarily due to an increase in property taxes, payroll and benefits, marketing, and repairs and maintenance expenses.

Tenant reinsurance —Tenant reinsurance expense represents the costs that are incurred to provide tenant reinsurance and is subject to volatility due to increased claims arising when significant events occur at stores.

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, business combinations and growth through our joint venture partners and managed portfolio.

No other material trends in specific travel or other expenses were observed.

Depreciation and Amortization —Depreciation and amortization expense increased primarily as a result of the acquisition of new stores.

We acquired 58 wholly-owned stores during the year ended December 31, 2024.

We acquired 757 wholly-owned stores in the Life Storage Merger and an additional 14 wholly-owned stores during the year ended December 31, 2023.

Other Income and Expenses

General and administrative expense increased primarily as a result of stock compensation expense, which includes the acceleration of expense due to an executive officer’s retirement.

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 the year ended December 31, 2025, primarily due to the customer intangibles associated with our merger with Life Storage being fully expensed in January 2025.

Other Revenues and Expenses

The following table presents information on other revenues and expenses for the years indicated:

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Interest expense (587,613) (551,354) (36,259) 6.6 %

Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes (43,720) (18,786) (24,934) 132.7 %

Non-cash interest expense related to amortization of discount on unsecured senior notes, net (47,519) (43,720) (3,799) 8.7 %

Interest income 163,202 124,422 38,780 31.2 %

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Income tax expense (41,559) (33,478) (8,081) 24.1 %

Total other expense, net $ (500,797) $ (319,688) $ (181,109) 56.7 %

Loss on Real Estate Assets Held for Sale and Sold, Net— During the year ended December 31, 2024, we had 18 stores classified as held for sale.

Of the 18 stores, 10 had an estimated fair value, net of selling costs, which was less than the carrying value of the asset.

As a result, we recorded an estimated loss of $63,250.

On our consolidated statements of operations, this amount is shown net of the sale of a property which generated a gain of $37,344 within gain (loss) on real estate assets held for sale and sold, net.

Impairment of Life Storage Trade Name— During the year ended December 31, 2024, we decided to operate all stores under a single brand.

As a result of that decision, we deemed the Life Storage trade name intangible asset to be impaired and recognized a loss for the full value of the asset.

Interest Expense— The increase in interest expense during the year ended December 31, 2024 was primarily the result of higher outstanding debt compared to the same period in the prior year.

Information on the total face value of debt and the weighted average interest rate for the years ended December 31, 2024 and December 31, 2023 is set forth in the following table:

For the Year Ended December 31,

Total face value of debt $ 12,600,661 $ 11,346,105

Weighted average interest rate 4.4 % 4.6 %

Non-cash Interest Expense Related to Amortization of Discount on Life Storage Unsecured Senior Notes— 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.

Interest Income— Interest income represents interest earned on variable interest rate bridge loans, debt securities and on notes receivable from common and preferred Operating Partnership unit holders.

Total other revenues & expenses, net $ (466,463) $ (500,797) $ 34,334 (6.9) %

Loss on real estate assets held for sale and sold, net— During the year ended December 31, 2025, we recognized estimated losses of $115,830 related to properties sold or classified as held for sale given their estimated fair value, net of selling costs, was less than the carrying value of the assets.

The estimated losses are offset by net gains totaling $39,520 attributed to the disposition of stores during 2025.

The total net amount is shown on our consolidated statements of operations within loss on real estate assets held for sale and sold, net.

As of December 31, 2024, we had 18 stores classified as held for sale.

Of the 18 stores, 10 had an estimated fair value, net of selling costs, less than the carrying value of the assets.

we recorded an estimated loss of $63,250.

On our consolidated statements of operations, this amount is shown net of the sale of a property, which generated a gain of $37,344 within loss on real estate assets held for sale and sold, net.

Impairment of Life Storage trade name— During the year ended December 31, 2024, we decided to operate all our stores under a single brand.

As a result of that decision, we deemed the Life Storage trade name as an intangible asset to be impaired and recognized a loss for the full value of the asset.

Interest expense— The increase in interest expense during the year ended December 31, 2025 was primarily the result of higher outstanding debt.

As of December 31, 2025, we had approximately $13,481,899 in total face value of debt, compared to approximately $12,600,661 as of December 31, 2024.

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.

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 year ended December 31, 2025 was primarily the result of an increase in the amount of bridge loans outstanding.

The balance of bridge loans was $1,244,575 as of December 31, 2024, compared to $594,727 as of December 31, 2023.

The balance of bridge loans outstanding was $1,500,151 as of December 31, 2025, compared to $1,244,575 as of December 31, 2024.

The increase is also attributable to interest received on a $50,000 note receivable from a Common Operating Partnership unit holder.

This note receivable originated in December 2024, bears interest at 10% per annum and matures on June 30, 2026.

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.

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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 compared to 2023 is mainly attributed to the Life Storage stores being on our platform for 12 months in 2024 in comparison with five months in 2023.

Additionally, in November 2024 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 increase for the year ended December 31, 2025 is primarily due to a transaction in November 2024 in which we acquired additional ownership interest in 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.

Dividend income represents dividends from our investment in preferred stock of SmartStop Self Storage REIT, Inc.

and Strategic Storage Trust VI, Inc.

Equity in Earnings of Unconsolidated Real Estate Ventures - Gain on Sale of Real Estate Assets and Sale of a Joint Venture Interest— In August 2024, the ESS Bristol Investments LLC joint venture sold five of its eight stores to another unconsolidated joint venture, and we recognized a gain of $10,324 for our pro rata share of the transaction.

In September 2024, we sold our membership interest in the Alan Jathoo JV LLC unconsolidated joint venture, which held nine stores, to our partner and recognized a gain of $3,406 on the transaction.

Income Tax Expense— The increase in income tax expense for the year ended December 31, 2024 was primarily the result of a full year of TRS book income for Life Storage stores, compared to a partial year in 2023, as well as a decrease in permanent tax deductions related to stock awards.

This increase is offset by a decrease in equity in earnings due to the transfer and distribution of membership interests in the PR II EXR JV LLC joint venture in March 2025 and the acquisition of our partners’ membership interests in the ESS-NYFL JV LP and ESS CA-TIVS JV LP joint ventures in April 2025.

Also contributing to the offset is the sale of our membership interests in both the Extra Space Northern Properties VI LLC and the Life Storage Spacemax LLC joint ventures, which occurred in October and July 2025, respectively.

The number of stores in unconsolidated joint ventures in which we have ownership interests was 407 as of December 31, 2025, compared to 460 as of December 31, 2024.

Dividend income represents dividends from our investment in preferred stock of SmartStop and its affiliates.

Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and sale of a joint venture interest —The net gain of $54,521 for the year ended December 31, 2025 is due to the sale of our membership interest in nine properties in the Extra Space Northern Properties VI LLC joint venture in October 2025, which held 10 properties.

This resulted in a net gain of $45,167.

We also recorded a net gain of $9,354 on the sale of our membership interest in the Life Storage Spacemax LLC joint venture in July 2025, which held six properties.

During the year ended December 31, 2024, the ESS Bristol Investments LLC joint venture sold five of its eight stores to one of our unconsolidated joint ventures, and we recognized a gain of $10,324 for our pro rata share of the transaction.

Additionally, we sold our membership interest in another unconsolidated joint venture to our partner and recognized a gain of $3,406 on the transaction.

Income tax expense— The increase in income tax expense for the year ended December 31, 2025 was primarily the result of an increase in book income and a decrease in permanent tax deductions related to stock awards.

Comparison of the Year Ended December 31, 2024 to the Year Ended December 31, 2023

The results of operations for the years ended December 31, 2023 compared to December 31, 2022 was included in our Annual Report on Form 10-K for the year ended December 31, 2023 on page 23, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the Securities and Exchange Commission (the “SEC”) on February 29, 2024.

The results of operations for the years ended December 31, 2024 compared to December 31, 2023 was included in our Annual Report on Form 10-K for the year ended December 31, 2024 on page 23, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 28, 2025.

FUNDS FROM OPERATIONS

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generally accepted accounting principles (“GAAP”), excluding gains or losses on sales of operating stores and impairment write-downs of depreciable real estate assets, plus real estate related depreciation and amortization and after adjustments to record unconsolidated partnerships and joint ventures on the same basis.

We believe that to further understand our performance, FFO should be considered along with the reported net income and cash flows in accordance with GAAP, as presented in the consolidated financial statements.

We believe that to further understand our performance, FFO should be considered along with the reported net income and cash flows in accordance with GAAP, as presented in our consolidated financial statements.

FFO should not be considered a replacement of net income computed in accordance with GAAP.

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FFO does not represent cash generated from operating activities determined in accordance with GAAP and should not be considered as an alternative to net income as an indication of our performance, as an alternative to net cash flow from operating activities, as a measure of our liquidity, or as an indicator of our ability to make cash distributions.

The following table presents the calculation of FFO for the periods indicated:

The following table presents the calculation of FFO for the years indicated:

For the Year Ended December 31,

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Amortization of intangibles 20,316 113,886 59,295

(Gain) loss on real estate assets held for sale and sold, net 25,906 — (14,249)

Loss on real estate assets held for sale and sold, net 76,310 25,906 —

Unconsolidated joint venture real estate depreciation and amortization 32,748 32,678 24,400

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Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024

Our same-store pool for the periods presented consists of 1,071 stores that are wholly-owned and operated and that were stabilized by the first day of the earliest calendar year presented.

Our same-store pool for the years presented consists of 1,804 stores that are wholly-owned and operated and that were stabilized by the first day of the earliest calendar year presented.

We consider a store to be stabilized once it has been open for three years or has sustained average square foot occupancy of 80% or more for one calendar year.

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Average discounts as a percentage of rental revenues 2.1 % 1.9 %

The following table presents a reconciliation of same-store net operating income to net income as presented on our consolidated statements of operations for the periods indicated:

The following table presents a reconciliation of same-store net operating income to net income as presented on our consolidated statements of operations for the years indicated:

For the Year Ended December 31,

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Interest expense 587,613 551,354

Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes 43,720 18,786

Non-cash interest expense related to amortization of discount on unsecured senior notes, net 47,519 43,720

Depreciation and amortization 715,177 783,023

Income tax expense 41,559 33,478

Life Storage Merger transition costs — 66,732

General and administrative 186,343 167,398

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The same-store results for the years ended December 31, 2024 compared to December 31, 2023 was included in our Annual Report on Form 10-K for the year ended December 31, 2024 on page 27, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 28, 2025.

Cash flows from operating activities increased as expected due to our continued growth in revenues and through the increase in the number of properties we own and operate.

Cash flows from operating activities for the year ended December 31, 2025 were relatively flat 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.

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Life Storage Merger, net of cash acquired — — (1,182,411)

Impairment of Life Storage trade name 51,763 — —

Proceeds from sale of real estate assets 368,183 124,928 2,132

Investment in unconsolidated real estate entities (127,105) (301,917) (180,279)

Return of investment in unconsolidated real estate ventures 291,312 15,413 —

Issuance of notes receivable, net of sales and principal payments (256,172) (635,677) (20,812)

Proceeds from unsecured term loans, senior notes, revolving lines of credit and commercial paper 8,685,933 7,113,003 5,188,011

Principal payments on unsecured term loans, senior notes, revolving lines of credit and commercial paper (8,724,444) (7,088,984) (4,207,700)

Net proceeds (payments) from unsecured term loans, senior notes, revolving lines of credit and commercial paper (1,065,497) (38,511) 24,019

Proceeds from issuance of public bonds, net 1,650,000 1,300,000 1,550,000

Repurchase of common stock (149,548) — —

Dividends paid on common stock (1,374,298) (1,375,003) (1,046,341)

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.

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.

We expect to generate positive cash flow from operations, and we consider projected cash flows in our sources and uses of cash.

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We may use the proceeds from any borrowings to refinance existing indebtedness, to refinance investments, including the redevelopment of existing stores, for general working capital or to purchase additional interests in partnerships or joint ventures or for other purposes when we believe it is advisable.

As of December 31, 2025, we had $138,920 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.

The following table presents information relating to our debt:

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(2) $9,555,406 total fixed-rate debt including $1,381,834 on which we have interest rate swaps that have been included as fixed-rate debt.

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 $1.0 billion, and the net proceeds of the commercial paper notes are expected to be used for general corporate purposes.

We expect to fund our short-term and long-term liquidity requirements, including operating expenses, recurring capital expenditures, dividends to stockholders, distributions to holders of Operating Partnership units and interest on our outstanding indebtedness, out of our operating cash flow, cash on hand and borrowings under our revolving lines of credit and commercial paper.

In addition, we are pursuing additional sources of financing based on anticipated funding needs and growth assumptions.

Our commercial paper program provides us the ability to 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.

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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 December 31, 2024, we had $500 million in issuances outstanding under the commercial paper program.

In January 2021, we received a Baa2 rating from Moody's Investors Service, and in July 2019, we obtained a BBB/Stable rating from S&P which was upgraded to BBB+/Stable in July 2023 in connection with the Life Storage Merger.

At December 31, 2025, we had $680,000 in issuances outstanding under the commercial paper program.

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/Stable rating from Moody’s Investors Service.

We intend to manage our balance sheet to maintain these ratings.

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We were in compliance with all financial covenants at December 31, 2025.

As of December 31, 2024, we had $138,222 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 2024 and 2023, 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.

In addition, we are pursuing additional sources of financing based on anticipated funding needs and growth assumptions.

Our liquidity needs consist primarily of operating expenses, monthly debt service payments, recurring capital expenditures, distributions to unit holders and dividends to stockholders necessary to maintain our REIT qualification.

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On April 15, 2024, we entered into an equity distribution agreement (the “Equity Distribution Agreement”) with certain sales agents and forward purchasers named therein.

Under the terms of the Equity Distribution Agreement, we may issue and sell, and the forward purchasers may sell, from time to time through or to the sales agents, shares of our common stock having an aggregate offering price of up to $800 million.

The shares of common stock will be offered pursuant to our effective registration statement on Form S-3 (Registration Statement No.

333-278690) previously filed with and declared effective by the SEC and a prospectus supplement and accompanying prospectus, filed with the SEC.

As of December 31, 2024, no shares had been sold under the Equity Distribution Agreement, which we refer to as our “at the market” equity program.

As of December 31, 2025, no shares have been sold under the Equity Distribution Agreement, which we refer to as our “at the market” equity program.

CONTRACTUAL OBLIGATIONS

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis