Public Storage

Strong Q3 operating momentum → guidance raised (second time in 2026) - Core FFO: $4.34/share, +0.7% YoY. - Same-store NOI & revenue: each +0.5% YoY in Q3. - Leading indicators improved: average move-in rent +9% YoY (best since Q2’22), and move-in rates +28% vs Q4’25. - Occupancy / churn: occupancy ahead of prior year; churn improving and ECRIs strengthening (due to better customer retention + lower replacement cost). - 2026 outlook raised: Core FFO guidance to $16.90–$17.10/share (midpoint $17.00), + $0.10 (+0.6%) vs prior guidance. - Implied for full-year at midpoint: same-store revenue ~ +0.25%, same-store NOI ~ -0.3% (vs prior expectations improved by +45 bps revenue and +85 bps NOI).

Demand improving but still uneven; supply backdrop moderating (key macro nuance) - Management said there’s no “major change” in the macro, but the setup is improving due to: - Better retention (culture/customer obsession driving lower churn). - Moderating new supply (construction slowing), which should help the recovery. - Geography mix matters: - Sunbelt: still pressured by new supply in some markets, but supply is declining → expected support over time. - Coastal & Midwest: more “normalized” revenue growth in the ~2% to 4% range as supply is lower. - Los Angeles: improved after the earlier emergency pricing restriction expired.

PS Next + AI (“Ellie”) scaling customer experience (surprising operational signal: digital adoption) - Digital leverage: ~90% of customer interactions are digital; ~3/4 of customers complete leases digitally. - AI agent: “Ellie” has handled 300,000+ customer interactions; expansion continues. - AI expected to change how customers discover/compare/engage (but management emphasizes storage demand remains physical and need-based). - Investor takeaway: PS Next is presented as a competitive advantage that improves NOI/cash flow per property, supports higher retention, and reduces transaction friction—feeding both core performance and external growth returns.