Extra Space Storage Inc (EXR)

Business Description

Extra Space Storage Inc. operates as a fully integrated, self-administered, and self-managed real estate investment trust (REIT) focused on the self-storage industry. The company is involved in owning, operating, managing, acquiring, developing, and redeveloping self-storage properties across the United States. Extra Space Storage generates revenue primarily through its self-storage operations and also offers tenant reinsurance services, providing additional income through reinsurance premiums collected from tenants . As of December 31, 2023, the company owned and/or operated 3,714 stores across 42 states and Washington, D.C., managing approximately 283 million square feet of net rentable space .

Self-Storage Operations - Manages rental operations of wholly-owned stores, which are the primary source of revenue, contributing significantly to the company's overall income.
Tenant Reinsurance - Provides reinsurance of risks related to the loss of goods stored by tenants, generating additional revenue through reinsurance premiums collected from tenants.

Key Metrics

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Executive Team

Name	Position	Start Date	Short Bio
Joseph D. Margolis	Chief Executive Officer	January 1, 2017	Joseph D. Margolis has served as the Chief Executive Officer of Extra Space Storage Inc. since January 1, 2017. Prior to this role, he was the company's Executive Vice President and Chief Investment Officer from July 2015 until December 31, 2016. He has held senior positions at Penzance Properties and was a co-founding partner of Arsenal Real Estate Funds .
Zach Dickens	Executive Vice President and Chief Investment Officer	December 2020	Zach Dickens has served as the Executive Vice President and Chief Investment Officer at Extra Space Storage since December 2020. He has been with the company since 2002, holding various roles in the real estate department, including Executive Vice President of Investments. Before joining Extra Space Storage, he oversaw a technical support team at eBay .
Matthew Herrington	Executive Vice President and Chief Operations Officer	June 2020	Matthew Herrington has served as the Executive Vice President and Chief Operations Officer at Extra Space Storage since June 2020. He has been a member of the company's senior management team for over a decade, previously serving as the Senior Vice President of Operations from 2015 to 2020 .
Gwyn G. McNeal	Executive Vice President and Chief Legal Officer	July 2013	Gwyn G. McNeal has served as the Executive Vice President and Chief Legal Officer at Extra Space Storage since July 2013. She has been with the company since 2005, initially serving as Vice President and Associate General Counsel. Before joining Extra Space Storage, she practiced law at Latham & Watkins LLP in San Diego .
Samrat Sondhi	Executive Vice President and Chief Marketing Officer	June 2020	Samrat Sondhi has served as the Executive Vice President and Chief Marketing Officer at Extra Space Storage since June 2020. Prior to this role, he was the Chief Operations Officer from January 2013 to June 2020. He has been a member of the company's senior management team since 2008 and has been with the company since 2003 .
Noah Springer	Executive Vice President and Chief Strategy and Partnership Officer	December 2020	Noah Springer has served as the Executive Vice President and Chief Strategy and Partnership Officer at Extra Space Storage since December 2020. He has been with the company since 2006, holding various roles in acquisitions, third-party management, and asset management .
Scott Stubbs	Executive Vice President and Chief Financial Officer	December 2011	Scott Stubbs has served as the Executive Vice President and Chief Financial Officer of Extra Space Storage Inc. since December 2011. Before this role, he was the Senior Vice President of Finance and Accounting since the company's inception as a public company and served as the Corporate Controller of its predecessor starting in December 2000 .

Questions to Ask Management

With recent underperformance in key markets like Florida, what specific strategies are you implementing to mitigate further deterioration, and how confident are you in their effectiveness?
Despite efforts to close the performance gap between Life Storage and Extra Space properties, there's still a 6% spread in like-for-like markets; what challenges are preventing parity, and how do you plan to address them?
Given that you retain mezzanine positions when selling the A pieces of loans, how are you managing the increased credit risk associated with holding onto the riskier portions of these loans?
You anticipate $10 million in marketing cost savings from integrating Life Storage stores under the Extra Space brand; what is the timeline for realizing these savings, and what risks could impact achieving this goal?
As some customers are moving out due to rate increases from your ECRI program, how sustainable is this strategy without negatively affecting occupancy rates, and how do you balance rent growth with customer retention?

Program Details	Program 1
Approval Date	November 13, 2023
End Date/Duration	Not explicitly stated
Total additional amount	$500,000
Remaining authorization amount	$500,000 as of September 30, 2024
Details	The program allows for the repurchase of shares with an aggregate value up to $500 million

Competitors

Competitors mentioned in the company's latest 10K filing.

CubeSmart: A primary competitor and a public self-storage REIT .
National Storage Affiliates: A primary competitor and a public self-storage REIT .
Public Storage: A primary competitor and a public self-storage REIT .

Auditor

Name	Start Date	End Date	Reason for Change
Ernst & Young LLP	2005	Present	Current auditor