Public Storage

Stronger operating momentum; raised 2026 outlook again (good news) - Q3 core FFO: $4.34/share, +0.7% YoY. - Same-store performance: Revenue +0.5% YoY, NOI +0.5% YoY; sequential acceleration with same-store revenue improving +110 bps into positive territory. - Leading indicators strengthened: Move-in rents +9% YoY (strongest since Q2 2022); move-in rates +28% vs Q4 2025; churn improving and occupancy stabilizing. - Guidance raised (2nd time in 2026): Core FFO $16.90–$17.10/share (midpoint $17.00), up $0.10 (+0.6%). - At midpoint, outlook implies same-store revenue +0.25% and same-store NOI -0.3% (improved by +45 bps and +85 bps, respectively, vs prior outlook).

Demand/churn and supply backdrop improving; challenges remain uneven by market (mixed) - Management says there’s no major macro shift, but demand is still uneven across geographies. - Better retention driving the improvement (culture/customer obsession cited; example of staff helping customers use the app to open gates). - Supply is moderating as new construction slows, supporting gradual recovery—especially where supply pressure had been heavier. - Market dispersion: - Top 25 markets: 60% positive YoY revenue growth, 70% sequential improvement. - Sunbelt: new supply still pressures some markets, but declining supply should support recovery over time. - Los Angeles: improving after expiration of earlier restrictions; management indicates LA not a major driver of the Q3 “9% move-in rent” result.

PS Next + AI: scaling digital/AI interactions to improve unit economics (opportunity) - Nearly 90% of customer interactions are digital; about ~3/4 of customers complete leases digitally. - AI agent “Ellie” has handled 300,000+ customer interactions; expanding capability is expected to improve customer experience and allow staff to focus on higher-touch cases. - Explicit belief: AI changes discovery/interaction, but does not change fundamental need for storage; PS is positioned via scale, digital foundation, brand, and CX. - Investors should view this as an engine to support higher retention/ECRIs and better cash flow per property.