Cubesmart · NYSE:CUBE
Cubesmart — Investor Presentation (February 2016)
27 slides from Cubesmart's investor presentation, Feb 24, 2016
Slide 1: Investor Presentation February 2016
INVESTOR PRESENTATION FEBRUARY 2016
Slide 2: Introduction to CubeSmart
INTRODUCTION TO CUBESMART Self-Storage REIT with Expansive National Platform by Market Owned Portfolio CUBE ll,.jlij•J $6.75 billion Malvern, PA NVSE. 1) Property count as of December 31,2015. 2) Market value of common and book value of preferred equity and debt as of December 31, 2015. ® Cu
Slide 3: Total return versus S&P 500, RMZ and self-storage REITs
4 120.0% 100.0% 9 2 .1% 80.0% 60.0% 40.0% 20.0% 0.0% -20.0% S& P 500 RMZ Self-S torage REITs CUBE 1 1 0.2% 3 8 .7% 1 Y ear 2 Y ear 3 Y ear
Slide 4: Long-Term Vision for Value Creation
LONG-TERM VISION FOR VALUE CREATION EXTERNAL GROWTH Continue to prudently build a portfolio of high-quality assetsJ with a focus on targeted markets. ®Cu-------------------------------------------------------------------------------------------------------------------------------------FINANCIAL STRE
Slide 5: Long-Term Vision for Value Creation
LONG-TERM VISION FOR VALUE CREATION INTERNAL GROWTH Maximize portfolio value through continued focus on customer service and operational enhancements. @ CuseSmart EXTERNAL GROWTH Continue to prudently build a portfolio of high-quality assets, with a focus on targeted markets, FINANCIAL STRENGTH Fina
Slide 6: Internal Growth: Performance Fueled by Innovation
GJ INTERNAL GROWTH: PERFORMANCE FUELED BY INNOVATION Enhancing the customer experience at all points of engagement through proprietary systems and processes. Constantly testing digital platforms, utilizing marketing advancements, sophisticated systems, and new programs that strengthen customer relat
Slide 7: Internal Growth: Internet Marketing
INTERNAL GROWTH: INTERNET MARKETING Optimizing marketing efforts and efficiently attracting customers through use of industry leading analytics. Jamaica Self Storage - CubeSmart.com WNW cubesmart com/ • Up to 1 Month Free Rese<Ve Today It's Fast & Easy To Reserve Onlme Find a Locatioo - Up to 1 Moot
Slide 8: Internal Growth: Internet Marketing
INTERNAL GROWTH: INTERNET MARKETING • i'i CUSTOM EXPERIENCE 1 f) PERSONA 1 •li Q <?' Q • B w q......., .1. ......... ---+ II®'1./ IC:J ---+ r.\ ·I 1=•!!1 CUSTOM EXPERIENCE 2 ....,.... . PERSONA 2 .....,. oC9 VISITOR DATA AND BEHAVIOR .I ..h. 1•!!1 CUSTOM EXPERIENCE 3 PERSONA 3 ' :.::;; ' VISITORS ®C
Slide 9: Custom experience by persona
CUSTOM PERSONA1 E> EXPERIENCE 1 ‘CUSTOM PERSONA 2 E> EXPERIENCE 2 VISITOR DATA ? ‘CUSTOM visitors that increase engagement and conversion = Understanding the motivations of different cust ds they tru
Slide 10: Internal Growth: Revenue Management
INTERNAL GROWTH: REVENUE MANAGEMENT Revenue Management Landscape Multi-Family Residential t/ t/ t/ t/ Self Storage t/ t/ t/ t/ t/ Airlines t/ t/ t/ Hotels t/ t/ t/ Supply Constraints Competition Seasonality Low Transaction Volume Unpredictable Length of Stay • Historically, advanced revenue manageme
Slide 11: Revenue Management Landscape
Revenue Management Landscape Ainines | otets | "Resident | storage Constants v v Competition Vv Vv Vv seasonality v Vv v te ome v Unpredictable Length of Stay Historically, advanced revenue management techniques have boosted revenue in a number of supply-constrained industries, beginning with airlin
Slide 12: Internal Growth: Revenue Management
INTERNAL GROWTH: REVENUE MANAGEMENT Fundamental Pricing Issues Pricing optimization requires consideration of a multi-dimensional demand landscape and dynamic capacity constraints + Substitutabilit Competition yi ' + Capacity / i Ui F = ty Pricing Decisions Cube Type Optimal Pricing
Slide 13: Internal Growth: Customer Service
INTERNAL GROWTH: CUSTOMER SERVICE • Focus on customer service throughout all touch points (store, sales center, and website) to create a fully-integrated interaction with each customer • Modern offices and operational training focused on service-oriented values facilitate an efficient rental process
Slide 14: Internal Growth: Customer Service
INTERNAL GROWTH: CUSTOMER SERVICE An Award-Winning Service Culture STEVI E. WIN NER STEVI E. WIN NER STEYlE. WlNNER STEVIE•WLNNER STEVIE' WINNER FOR SALES& Customer Service Training Team of the Year Customer Service Department of the Year Innovation in Customer Service Customer Service Departmen t o
Slide 15: Internal Growth: Customer Service
INTERNAL GROWTH: CUSTOMER SERVICE @ An Award-Winning Service Culture GOLD GOLD GOLD GOLD GOLD GOLD STEVIEWINNER ——STEVIEWINNER—STEVIEWINNER—STEVIEWINNER STEVIE WINNER —_STEVIEWINNER. 2els STEVIE WINNER STEVVES STEVES STEVWES STEVVES ZOLS) -2ZOls,) Bors Customer Innovation customer customer Contact S
Slide 16: External Growth: Focused Investment Strategy
@) EXTERNAL GROWTH: FOCUSED INVESTMENT STRATEGY Focus on Adding Scale in Attractive, High-Barrier-to-Entry Markets •Acquisitions, 2008 - Dec. 31, 2015 •Dispositions, 2008 - Dec. 31, 2015 Q Development Properties, 2014 - Dec. 31, 2015 $2.2 billion $460 million 1) Transactions closed from 2008 through
Slide 17: External Growth: High-Quality Assets
EXTERNAL GROWTH: HIGH-QUALITY ASSETS Enhancing Our Portfolio by Adding Purpose-Built Class A Facilities Malvern,PA Bronx,NY ®Cu-------------------------------------------------------
Slide 18: External Growth: Development
EXTERNAL GROWTH: DEVELOPMENT Leverage Local Market Expertise of Partners to Generate Highest Returns $42.3M Total $49.3M Total $98.9M Total Total 1Q14 Bronx, NY-$17.2M 2Q15 Arlington, VA-$17.1M 1Q16 Queens, NY - $32.1M $49.8M 1Q14 Malvern, PA - $25.1M 4Q15 Queens, NY - $17.4M 2Q16 Bronx, NY-$32.0M 4
Slide 19: External Growth: Purchase at Completion
EXTERNAL GROWTH: PURCHASE AT COMPLETION Acquire High-Quality,Purpose-Built Assets and Add to CubeSmart Platform with Sophisticated Marketing and Revenue Management Systems Total Total Total NY $48.5M $10.1M $10.8M ®Cu----------------------------------------------------------------------------------
Slide 20: External Growth: Purchase at Completion
EXTERNAL GROWTH: PURCHASE AT COMPLETION a Acquire High-Quality, Purpose-Built Assets and Add to CubeSmart Platform with Sophisticated Marketing and Revenue Management Systems $38.0M Total $15.8M Total $69.4M Total $32.0M Total 4Qi4 2Q15 1Q16 1Q17 Long Island City, NY - Dallas, TX - $15.8M Brooklyn,
Slide 21: Third-party management platform
Third-party management allows us to leverage our operating platform and generate additional economies of scale = Platform has grown to properties since its inception in 2009 = Purchased properties from our managed portfolio for ' since 2010
Slide 22: Debt maturity schedule
24 $500,000 $400,000 $300,000 $210,154 $200,000 $100,000 $0 $0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 (in thousands) SecuredUnsecuredTotal $250,000 $252,500$250,000 $100,000 $111,627 $35,158 $50,554 $0 1) Based on EBITDA and average debt outstanding during 4Q15.
Slide 23: Dividends and credit metrics
25 2010 2011 2012 2013 2014 2015 80.0% $0.60 40.0% $0.30 20.0% Dividend per Share Dividend Payout Ratio REIT Avg. Payout Ratio % of Gross Assets Dividend per Share EBITDA / Interest Expense Dividend Payout Ratio 60% 50% 40% 30% 20% 10% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Secured Deb
Slide 24: External Growth: Key Credit Metrics
EXTERNAL GROWTH: KEY CREDIT METRICS Strong Operating Performance Coupled with Conservative Balance Sheet Management Continues to Improve Credit Metrics Historical Leverage Levels! EBITDA Coverage Ratio! i] pe Son B ioe ena nnn 21a 2020 2d 08 Sereda Uneoned D8 Gross Assets’ Dividends? 080 000% 3.50 -
Slide 25: Same-Store Performance and Trading & Valuation Metrics
27 S am e - S tore Pe rf orm an c e 1 2010 2011 2012 2013 2014 2015 Ex te rn al G row th T radi n g & Val u ati on Me tri c s Market Equity Value2 $965 $1,277 $2,049 $2,335 $3,752 $5,496 Total Market Capitalization2 $1,580 $2,035 $3,073 $3,474 $4,926 $6,758 Total Gross Assets2 $1,793 $2,195 $2,504 $
Slide 26: Contact Us
Contact Us Contact Info Charles Place Director, Investor Relations Email: cplace@cubesmart.com Telephone Office Phone: 610.535.5700 ®Ou---------------------------------------------------
Slide 27: Contact Info
& Contact Info Charles Place Director, Investor Relations Email: cplace@cubesmart.com Dp Telephone Office Phone: 610.535.5700