Public Storage

Raised 2026 guidance again on stronger operating momentum (core FFO +0.6%) - Management raised full-year Core FFO guidance by $0.10 (+0.6%) to $16.90–$17.10/share (midpoint $17.00), the second raise in 2026. - Q3 Core FFO was $4.34/share (+0.7% YoY). - Same-store revenue +0.5% and same-store NOI +0.5% in Q3. - Updated full-year outlook at midpoint: same-store revenue +0.25% and same-store NOI -0.3% (improving 45 bps revenue and 85 bps NOI vs prior outlook). - Forecast assumptions: low single-digit move-in rent growth, modestly positive YoY occupancy, and churn improvement driving higher ECRIs (enhanced customer-related income).

Demand profile improving: retention up, pricing power strong, supply backdrop moderating - Key leading indicators strengthened: - Average move-in rent change: +9% YoY in Q3 (described as the strongest since Q2 2022). - Move-in rates: +28% vs Q4 2025 (ahead of historical stabilization trends). - Churn improved and occupancy stabilized as retention gains accelerated (management cited culture/customer-obsession changes, including app/gate support behaviors). - Sequencing: same-store revenue/NOI accelerated from Q2 to Q3; Q4 implied same-store revenue growth discussed as ~+1% (consistent with October trends). - Geographic mix matters: demand uneven by market; Sunbelt new supply pressures continue in pockets but new construction slows, supporting gradual recovery. - LA recovery: after state-of-emergency pricing restrictions expired earlier this year, LA moved back to positive revenue growth; management expects further recapture over time.

PS Next & AI: scaled digital/AI platform improving customer experience and efficiency - Nearly 90% of customer interactions are digital and ~3/4 of customers complete leases digitally. - AI agent (“Ellie”) has handled 300k+ customer interactions and expanded capabilities; management expects increasing use not just by customers directly but through AI agents (examples named: Meta/Grok bots, etc.). - Management emphasized a key view: AI changes discovery/evaluation/engagement—not the physical need for storage. - The AI/digital platform is positioned as a competitive advantage supporting higher retention, better pricing execution, and faster capital underwriting.