Nobody Invited Me to Storage Earnings Season, So I Held My Own Call
Three Wall Street questions from Storage REITs' Q2 calls, answered the way a public CEO never could.
Last week the storage REITs reported quarterly earnings. So, being a good storage data nerd, I listened to the Public and Extra Space calls when something struck me.
I don't know how else to say this: every one of them was run in the same format as 1978.
Each management team probably had a Cisco speakerphone in the middle of a conference table, printed out papers with talking points, and pressure to stick to the approved script. Everyone thanks each other and it ends.
It is 2026.
The data these companies have access to is extraordinary. Same for the analysts on the other side of the line. The market should expect higher-resolution answers than "almost all MSAs" and "there's a lot of variables."
None of that is evasion, to be clear. It's the job. A public company CEO answering with specifics creates disclosure obligations, invites lawsuits, and hands ammunition to competitors. I totally get it.
But I don't run a public company.
So here's what I want to do. Share a quick summary of what actually happened in the Extra, Public, and Cube earnings, then three questions from the Q&A asked to me while I play storage REIT CEO.
All three REITs raised guidance for the first time in what feels like a millennia. Here is a brief summary in fancy table format:
| REIT | Same-store rev | Same-store NOI | Occupancy | Core FFO/sh | Guidance |
|---|---|---|---|---|---|
| Extra Space | +2.4% | +3.5% | 94.2% | $2.15 (+4.9%) | Raised |
| Public Storage | −0.6% | −2.2% | 92.5% | $4.17 (−2.6%) | Raised (NSA close) |
| CubeSmart | +0.8% | −0.7% | 91.0% | $0.63 (−3.1%) | Raised |
I also posted about my takeaways for Public Storage here, and Extra Space here.
So now, let's dive into 3 actual analyst questions for how I'd answer them.
1. Which markets actually drove the outperformance?
Viktor Fediv, CFA from Scotiabank asked which markets contributed most to the quarter's outperformance for Extra Space. Great question.
I pulled the MSA scoreboard looking at more than 10,000 same stores' year over year performance in 10x10 street rates for the 39 largest markets where we price at least 60 identical facilities in both months: 34 of them are positive (which is encouraging).
The magnitudes in MSA changes vary widely, though. San Jose and San Francisco take the top spot, up 22.7% and 17.3% respectively.
It seems the AI boom in Silicon Valley is shown in these storage numbers. If only storage facilities could store servers.
The five markets still in the red tell you where the cycle isn't finished: Tampa -5.3%, Detroit -2.2%, Oklahoma City -1.3%, Houston -0.4%, Phoenix -0.1%. Which brings us to the question someone actually asked about those markets.
2. How are Sun Belt street rates actually trending?
Ravi Vaidya, CFA from Mizuho asked about the operational inflection in Sun Belt markets and how street rates have been trending. The answer named names but no numbers: Austin, Dallas, and Miami turned positive; Houston, Tampa, and Phoenix are still difficult.
My answer is another scoreboard. Same stores, July over July, 10x10 street rates: Austin +12.3%. Miami +11.0%. Dallas +4.0%. Phoenix -0.1%. Houston -0.4%. Tampa -5.3%.
As a fun fact, Austin (where I live) isn't "turning positive." Austin is ripping double digits off a very deep bottom, at $1.13 a square foot, while carrying one of the heaviest development pipelines in the country.
Interestingly, one of the biggest rate recoveries in storage is happening in a market still building aggressively.
3. What gets revenue growth back to 3%?
Michael Mueller from JP Morgan asked how much street rate lift is needed to get back to 3% same-store revenue growth. This one got the fullest dodge of the call: a lot of variables, hard to plug in one piece of the formula.
Fair. It is a hard formula. But here's the shape of my answer.
Same stores, street rates today are still about 20% below the summer 2022 peak. That's the hole. The trajectory out of it: July street rates are up 4.4% year over year across more than 10,000 same-store facilities, the strongest July print of this entire cycle, after four straight Julys of decline that bottomed near -13%.
Street rates lead reported revenue by several quarters, because today's move-in rate takes time to roll through a rent roll. Which means the math to 3% doesn't require heroics. It requires this July to not be a head fake. If street rates hold mid single digit growth into 2027, the 3% question answers itself sometime next year. If they roll over the way they did last fall, it doesn't.
Want the full scoreboard?
- Every chart above downloads in full resolution with the button beneath it.
- The data pack, all 39 markets with rates and YoY change in a clean spreadsheet, goes to newsletter subscribers. Comment SCOREBOARD on the LinkedIn post and I'll send you the link.
Why nobody on the call answers this way
Because they can't in the conference call format. And honestly, because they shouldn't. Guidance ranges exist for a reason, and a CEO freelancing market-by-market rate predictions on a recorded call is a CEO creating problems for his general counsel.
That's the quiet thing about this earnings season. The information asymmetry in storage has flipped. It used to be that operators knew everything and the market knew nothing. Now the market data sits in TractIQ, updated daily, across more than 70,000 facilities, and the constraint on specificity isn't knowledge. It's securities law.
The REITs run the best stores in the industry. I'll take the other job: answering the questions.
