Cubesmart · NYSE:CUBE
Cubesmart — Merger or Acquisition (November 2021)
22 slides from Cubesmart's merger presentation, Nov 15, 2021
Slide 1: Storage West Acquisition
Storage West Acquisition November 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements include statements concerning our plans, objectives, goals,
Slide 3: 1. As of September 30, 2021. 3. Period ending December 31, 2020, Source: SNL
3 1. As of September 30, 2021. 3. Period ending December 31, 2020, Source: SNL Financial. 2. Market value of common equity and book value of debt as of September 30, 2021. 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 Storage West team Philadelphia CubeSmart Moody’s and S&P developments Acquisition Acquired United Acquired 2
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: Attractive fundamentals have driven continued evolution of the industry
Attractive fundamentals have driven continued evolution of the industry New ? Supply Product Awareness ¢ ] ——— Strong Meee returns Ane led to increased Continued growth in awareness & utilization new development across many core markets has increased demand for the product | ia! Favors returns have
Slide 7: 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 8: 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 9: Same-store results for the nine months ending September 30, 2021
9 1. Same-store results for the nine months ending September 30, 2021, as compared to the nine months ended September 30, 2020. 2. For the nine months ending September 30, 2021.
Slide 10: CubeSmart has agreed to acquire LAACO, Ltd.
• CubeSmart ("CUBE" or the "Company") has agreed to acquire LAACO, Ltd., the entity that owns the Storage West self-storage portfolio, for $1.69 billion, which includes $40.9 million of debt • $1.64 billion cash purchase price for the self-storage assets (1) • $59 million to $62 million of estimated
Slide 11: Unique opportunity to acquire a sizeable and high-quality portfolio in top markets
• Unique opportunity to acquire a sizeable and high-quality portfolio in top markets • Portfolio is consistent with CUBE’s stated investment strategy focusing on high-quality, attractive top-40 MSAs • Expands CUBE’s existing market concentration in Southern California San Diego, CA (San Diego, Orang
Slide 12: San Diego, Phoenix, Las Vegas, Houston
San Diego, CA Phoenix, AZ Las Vegas, NV Houston, TX Inland Empire, CA Phoenix, AZ Las Vegas, NV Houston, TX 12
Slide 13: The high-quality portfolio spans 59 self-storage assets across the Southwest
• The high-quality portfolio spans 59 self-storage assets totaling 4.4 million square feet across the Southwest • LAACO also owns certain non-core properties, including The Los Angeles Athletic Club, the California Yacht Club and a land parcel in Las Vegas, which CUBE expects will be sold prior to o
Slide 14: Substantial Submarket Overlap
Substantial Submarket Overlap Storage West's portfolio is complementary to CUBE’s existing presence in these markets which will drive efficiencies and operating synergies as well as provide runway for future growth Southern California ond, é of : % Cy © = dl $ e e” e e bg a e e ee e & ©, @cuse e e @
Slide 15: Pro Forma
(1) Pro Forma 545 59 604 402,356 40,100 (2) 442,473 39.0M 4.4M 43.4M 93.4% 94.9% 93.6% $19.26 $19.62 $19.30 15 1. As of September 30, 2021. 2. Includes non-storage units. 3. CUBE NOI is actual for three months ending September 30, 2021 annualized. Storage West pro forma 2022 NOI.
Slide 16: Transaction summary and sources and uses
▪ Acquire LAACO, Ltd. for $1.69 billion, which includes $40.9 million of debt ▪ Expected to be immediately accretive to FFO per share with enhanced levels of accretion expected to be achieved through the realization of CUBE operating synergies over time ▪ Intend to permanently finance the transactio
Slide 17: Pro Forma for Storage West Acquisition
Pro Forma for Storage West Acquisition CUBE Transaction Adj. Pro Forma CUBE As of 9/30/2021 (In millions, except per share data) Share Price as of 11/12/2021 $54.60 $54.60 Fully Diluted Shares & Units Outstanding 210.3 13.5 223.8 Equity Market Capitalization $11,482 $12,219 (1) Revolving Credit Faci
Slide 18: Well-laddered debt capitalization with limited near-term maturities
CUBE will maintain a well-laddered debt capitalization with limited near-term maturities $1,000 $800 $ in Millions $600 $400 $54 $32 $38 $200 $450 $300 $300 $300 $350 $350 $0 $33 Unsecured Senior Notes Mortgage Loans and Notes Payable 18 1. Excludes share of unconsolidated joint venture debt. Exclud
Slide 19: 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 20: Investment 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 21: Appendix
21| CUBESMART' Appendix
Slide 22: Net Income to EBITDA Reconciliations
As of Net Income to EBITDA Reconciliations September 30, 2021 Net income $90,569 Depreciation and amortization 55,871 Interest 20,134 Gains from sales of real estate, net (28,815) Equity in (earnings) losses of real estate ventures (816) Other expenses (539) EBITDA $136,404 22