Cubesmart · NYSE:CUBE
Cubesmart — Investor Presentation (March 2021)
31 slides from Cubesmart's investor presentation, March 2021
Slide 1: March 2021
March 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement The forward-looking statements contained in this presentation are subject to various risks and known and unknown uncertainties. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, there can be no assur
Slide 3: 1. As of December 31, 2020 2. Market value of common equity and book
1. As of December 31, 2020 3. Period ending December 31, 2020 2. Market value of common equity and book value of debt as of December 31, 2020 4. Annual dividends declared in period ending December 31, 2020
Slide 4: Arrival of current management team
Moved Received Grew the portfolio by over Arrival of current headquarters to Rebranded Investment Grade $2.5 billion through management suburban company as credit rating from acquisitions and team Philadelphia CubeSmart Moody’s and S&P developments Acquired United Acquired 22 Began capital Stor-All
Slide 5: Value Creation Strategy
Value Creation Strategy Generate sustainable growth to maximize long-term shareholder value Building an industry leading platform to generate outsized growth from our high quality portfolio, maximizing long-term shareholder value 5| CuBESMART’ Attractive Industry Experienced Management Team Sophisti
Slide 6: Self-storage has been a top performing REIT sector through all phases of the economic cycle
Self-storage has been a top performing REIT sector through all phases of the economic cycle with 10-year returns averaging 17%1 Most diverse customer base of any REIT sector, averaging over 650 customers per store Month-to-month rentals allow for rapid repricing in response to changing economic cond
Slide 7: Attractive fundamentals have driven continued evolution of the industry
Attractive fundamentals have driven continued evolution of the industry New ) Sus Suny Ween returns Tae led to increased Continued growth in awareness & utilization new development across many core markets has increased demand for the product Favors returns have been driving ae Sophistication of lar
Slide 8: Executive management team
• Chris has been CEO of CubeSmart since January 2014 • Currently the longest-tenured CEO in the sector • Joined the company in 2006, and previously served as Chief Operating Officer, Chief Investment Officer, and Chief Financial Officer • Currently serves on the board of NAREIT • Tim has been CFO of
Slide 9: Execution on our core operations has driven strong organic growth
• Execution on our core operations has driven strong organic growth • We continue to grow the portfolio through all available avenues to maximize risk-adjusted returns for shareholders, including meaningful cash flow growth
Slide 10: Attracting the greatest share of potential demand
Attracting the Proprietary Building a Award-winning greatest share of systems and foundation of customer service potential demand processes to proprietary platform delivers through dynamically solutions to an unparalleled continually generate pricing improve experience evolving digital decisions in
Slide 11: Marketing and revenue management platform
• SEO-focused content creation • Website A/B Testing • Optimized customer rate • Targeted local marketing efforts • Conversion funnel analysis and increase model • Exploratory marketing channels optimization by a team of data • Award winning customer service • Sophisticated brand scientists • Intern
Slide 12: Digital rental and mobile app
Launched: April 2020 Launched: September 2020 • Ability to rent online from any web-enabled device • Rent a cube and find new locations, contact-free • Customers can reserve their unit, sign a lease, pay & • Access personal gate codes move in without interaction with CubeSmart • Pay bills & set up a
Slide 13: Performance versus other storage REITs
1. Reported average full-year metrics for the other three largest publicly-traded storage REITs by market cap from January 1, 2016 through December 31, 2020
Slide 14: Portfolio by market
Boston 2% NY/NJ/LI Chicago 21% Staten Island 7% Phila. 0.4% 3% Wash DC Queens 7% 4% North NJ 5% Brooklyn Long Island So. CA 3% 2% 3% Westchester Bronx 2% Atlanta 5% Phoenix 3% 3% Dallas 6% States with Owned Stores Houston Orlando 2% 2% States with Managed Stores Only Miami 9% 1. During the quarter e
Slide 15: 1. Source: Bank of America Merrill Lynch Research Report dated January 9, 2019 2.
1. Source: Bank of America Merrill Lynch Research Report dated January 9, 2019 2. Source: Evercore ISI Research Report dated November 13, 2019
Slide 16: High population density creates a strong demand profile around our stores
High population density Renters boost demand NYC square foot per creates a strong as they are 3.9x more capita is substantially demand profile around likely to move than lower than the industry our stores homeowners average 11 1 2 00 1. Source: CubeSmart 3-mile portfolio demographics 2. CubeSmart in
Slide 17: New York City zoning and development restrictions
• In 2017, NYC passed a zoning amendment that required a special permit for self-storage to be built in the Industrial Business Zones (IBZs) • The IBZs reduced the land that was previously zoned by- right for storage by 49%1 • NYC recently excluded all self-storage development from eligibility under
Slide 18: Focus on markets with strong demographics to drive long-term value
Focus on markets with strong demographics to drive long- term value Build and acquire Class-A properties in core infill locations by leveraging local developer expertise Invest with partners to expand national footprint and improve returns for lease-up opportunities Expand scale of platform, generat
Slide 19: Development projects
1 Our development projects are 12 Projects 3 Projects 2 Projects 2 Projects projected to create over $340 million in value at stabilization2 2 Projects 1 Project 1 Project 1 Project 1 1. As of December 31, 2020 2. Proforma based on stabilized NOI projections and current market cap rates
Slide 20: Joint venture investments
Strong returns through levered structures and promotes Opportunity to purchase assets at the end of the hold period Fee revenue increases our return profile Market and cash flow diversification Mitigates dilution of lease-up properties 35 properties 21 properties 13 properties 14 properties $315.7 m
Slide 21: Joint venture strategic goals
• Our participation as a 10% owner in venture accomplished a number of strategic goals: • Expanded relationship with our JV partner • Participated in portfolios with a mix of assets • Boosted returns through fee income • Shared in value creation through promoted returns • Acquired stores that fit ou
Slide 22: Third-party management platform
CubeSmart management has grown to the second largest stores on the national management platform4 as we continue to expand platform1 our national footprint and brand while increasing efficiency management Fees from the management business contribute fees2 meaningfully to FFO growth The management pla
Slide 23: Investment grade balance sheet
CubeSmart’s Baa2 senior unsecured rating reflects the REIT’s good financial flexibility and modest use of leverage. - Moody’s Investors Service 1. Source: Company Filings, as of December 31 of each stated year 2. Calculated as annual EBITDA / Interest Expense
Slide 24: Ample liquidity to manage near-term capital needs
Ample liquidity to manage near-term capital needs Proven ability to access a variety of sources of Capital Needs: $116.3M through 2022 capital, raising $4.4 billion since 2010 • $44.2M of debt maturities1 • Common Equity: raised $1.5 billion in net proceeds • $72.2M of remaining development commitme
Slide 25: Environmental initiatives
Since 2015, CubeSmart has completed Since 2010, CubeSmart has installed 76 lighting retrofits at 134 owned stores in energy management systems at owned 17 states and DC. These lighting stores to monitor and control a store’s upgrades save approximately 150,000 energy usage which decreased electricit
Slide 26: Engaging with our customers, teammates and communities
Engaging with our customers, teammates and communities Charitable Donations = Investments in Our Teammates Establishment of programs designed to increase Teammate Match employee contributions to charitable engagement, recognition and development organizations through our Gift Matching Program ha, Do
Slide 27: Governance
• Annual election of trustees • Separate position of Board • Share ownership guidelines for • Annual say-on-pay votes Chair & Chief Executive executive officers and trustees • Single voting class of stock Officer • Anti-hedging & anti-pledging • Shareholder right to call special • Regular executive
Slide 28: 2020 same-store results
1. Same-store results for the year ending December 31, 2020 2. For the year ended December 31, 2020
Slide 29: Summary
Maximizing property cash flows to generate long-term value through a continually evolving marketing, revenue management, and customer service platform An investment-grade balance sheet provides the strength and flexibility to access the full array of capital sources to finance growth opportunities P
Slide 30: Historical performance
Revenue Growth 0.3% 3.6% 3.8% 7.4% 7.2% 7.3% 7.0% 4.4% 3.3% 1.9% 0.8% NOI Growth 1.0% 5.7% 6.0% 9.3% 9.6% 9.6% 10.2% 5.1% 3.3% 1.1% 0.1% YOY Occupancy Growth (BPS) 0.6% 2.0% 3.4% 5.3% 2.6% 1.5% 0.8% 0.2% (0.2%) 0.0% 2.2% Annual Avg. Occupancy 76.8% 78.8% 82.6% 88.4% 90.8% 92.3% 92.9% 93.1% 92.7% 92.
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