Slide 1: Investor Presentation March 2012
Investor Presentation March 2012
Slide 2: Safe Harbor Statement
The forward-looking statements contained in this presentation are subject to various risks and uncertainties. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achie
Slide 3: Company Overview: A National Platform
3 Company Overview: A National Platform Owned Managed Self storage REIT with 480 facilities across the United States 376 owned facilities; 104 facilities managed on behalf of 3rd party owners An additional ~825 partner facilities in the CubeSmart Network CubeSmart Network facilities not shown. 1
Slide 4: The CubeSmart Story
4 The CubeSmart Story Attractive Industry Quality Portfolio Conservative Balance Sheet With Advantages for A Strong Platform Driving Internal Growth Supporting External Growth That Moves the Needle
Slide 5: Attractive Industry Characteristics
1 in 10 US households use self storage, up from 1 in 17 in 1995 Widely fragmented industry provides runway for consolidators Low variable cost level (operating leverage) fuels NOI growth Low maintenance cap-ex requirements Absence of tenant improvement requirements High operating margins Demand is d
Slide 6: Home Ownership Trends Support Growth
6 Home Ownership Trends Support Growth Declining US Homeownership US homeownership rate. Source: US Census Bureau Housing Vacancy Survey, 4Q11. Renters move roughly three times more frequently than homeowners Fewer Owners = More Renters More Mobility Movers represent more than ½ of self storage cust
Slide 7: Extended Length of Stay Supporting Results
7 Extended Length of Stay Supporting Results Median Length of Stay +25% Widening lengths of stay offset soft rental activity during the recession and continue to support performance 1 CubeSmart same-store portfolio. 8 6 4 2 0 2008 1H2011
Slide 8: Limited New Supply to Absorb Demand
8 Limited New Supply to Absorb Demand New Self Storage Construction Starts - Nationwide -61% Source: Cushman & Wakefield, Inc., Self Storage Performance Quarterly, 4Q11. 1 50 45 40 35 30 25 20 15 10 5 0 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11
Slide 9: REITs Taking Market Share
9 REITs Taking Market Share Year-Over-Year Occupancy Gains Source: Cushman & Wakefield, Inc., Self Storage Performance Quarterly. Source: CUBE, SSS, PSA, and EXR public filings. Average of year-over-year change in reported period-ending occupancies. 375 basis point average performance gap over past
Slide 10: Benefits of Scale and Sophistication
10 Benefits of Scale and Sophistication Strategic Partnerships Enhanced Services Marketing & Internet Presence People Internal Resources Processes Customer Capture Relationships Quality Team Sales Center Store Managers Systems Leveraging these resources provides a significant competitive advantage o
Slide 11: CubeSmart's Differentiated Service Platform
11 CubeSmart’s Differentiated Service Platform Organization – Offering resources that help customers track & organize their things Logistics – Helping customers get their items into and out of their space Amenities – Providing a more comfortable and accommodating environment Customization – A la car
Slide 12: Rebranding Update – Ahead of Expectations
Timeline More than 230 facilities rebranded to CubeSmart On track to convert substantially all remaining owned stores by April Cost Anticipate $2.0 million to $3.0 million capital investment in 2012 Total cost of rebranding to range from $4.5 million to $5.5 million – ahead of initial $8 million est
Slide 13: The CubeSmart Story
13 The CubeSmart Story Attractive Industry Quality Portfolio Conservative Balance Sheet With Advantages for A Strong Platform Driving Internal Growth Supporting External Growth That Moves the Needle
Slide 14: Competitive Results From Historical Portfolio
1) Arithmetic average of reported year-over-year same-store revenue growth for the 16 quarters ending December 31, 2011. Source: Company filings for CUBE, PSA, EXR, and SSS 14 Competitive Results From Historical Portfolio Same-Store Revenue Growth 1 Demonstrated resilience throughout recession. Comp
Slide 15: Recent Repositioning Has Been Substantial
Note: Bubbles sized by transaction value. All closed transactions as of 2/29/2012, including both stabilized and lease-up properties but excluding Storage Deluxe assets. Includes the second pool, the entirety of which is expected to close in 1Q12. 2012 projections are used for metric calculations. R
Slide 16: A Markedly Improved Portfolio
1) Realized annual rent per occupied square foot is computed by dividing rental income by the weighted occupied sq ft for the period. 2) Pro Forma, including all JV and wholly-owned assets as of 2/29/2012 as well as the entirety of the second pool of the Storage Deluxe portfolio, which is expected t
Slide 17: Now Positioned in Higher-Growth Markets
Pro Forma, including all JV and wholly-owned assets as of 2/29/2012 as well as the entirety of the second pool of the Storage Deluxe portfolio, which is expected to close in 1Q12. 2012 projections are used for acquired Storage Deluxe NOI. 17 Now Positioned in Higher-Growth Markets Current Geographic
Slide 18: Recent Activity – Continued Enhancement
Acquisitions: $75 to $125 million target Year to date, have closed on two assets in Houston and Atlanta for a total cost of $12.3 million Dispositions: $35 to $50 million target 18 Recent Activity – Continued Enhancement Acquisitions: $127 million (excluding Storage Deluxe) Focused on quality assets
Slide 19: Transformational Storage Deluxe Transaction
19 Transformational Storage Deluxe Transaction $560 million transaction 22 assets representing 1.6 million net rentable square feet, predominantly in the Greater New York City area Establishes CubeSmart as the largest owner of self-storage assets in New York City – one of the most attractive storage
Slide 20: The CubeSmart Story
20 The CubeSmart Story Attractive Industry Quality Portfolio Conservative Balance Sheet With Advantage for A Strong Platform Driving Internal Growth Supporting External Growth That Moves the Needle
Slide 21: Investment Grade Balance Sheet
BBB- Significant balance sheet evolution over past 3 years 21 Investment Grade Balance Sheet NOI from Unencumbered Assets 12/31/11 12/31/08 Debt / Gross Assets Rating 51% 35% Unrated As reported in Fourth Quarter 2011 Supplement Information Baa3 1 Unencumbered 49% Encumbered, 51% Unencumbered 65% En
Slide 22: Balanced Maturity Profile
22 Balanced Maturity Profile December 31, 2008 Current (Pro Forma) Less than 22% maturing in any given year Assumes closing of the second pool of Storage Deluxe assets and therefore includes the full balance of the term loan maturing in March 2017 as well as the assumption of debt secured by the fin
Slide 23: Host of Capital Sources to Support Growth
23 Host of Capital Sources to Support Growth Common Equity Preferred Equity Public Unsecured Debt Unsecured Bank Financing Joint Ventures Free Cash Flow Successfully sourced more than $1 billion of capital to support opportunistic growth in 2011. Strategic Dispositions CMBS / Secured Debt Private Pl
Slide 24: Opportunity for Meaningful External Growth
24 Opportunity for Meaningful External Growth Industry Fragmentation Runway for Consolidation in Both Ownership & Operations Acquisitions 3rd Party Mgmt Catalysts Significant levels of debt maturities in coming years on privately held storage assets. Operational advantages for large-scale platforms
Slide 25: Relationships Create Opportunity
25 Relationships Create Opportunity Source of 2011 Acquisitions, By Transaction Value Including Storage Deluxe1 Excluding Storage Deluxe2 Includes second pool of Storage Deluxe assets, all of which are expected to close 1Q12. Closed transactions. Nearly 2/3 of transaction value sourced through direc
Slide 26: The CubeSmart Story
26 The CubeSmart Story Attractive Industry Quality Portfolio Conservative Balance Sheet With Advantage for A Strong Platform Driving Internal Growth Supporting External Growth That Moves the Needle
Slide 27: Investor Relations Contact
Investor Relations Contact Daniel Ruble, CFA Vice President, Finance 460 E. Swedesford Rd. Suite 3000 Wayne, PA 19087 610.293.5700 druble@cubesmart.com