Arlen Nordhagen
About Arlen Nordhagen
Vice Chairperson of NSA’s Board; founder of NSA and long-time self storage operator. Age 68; MBA (with high distinction) from Harvard; BS, Chemical Engineering (summa cum laude) from University of North Dakota . Tenure at NSA includes CEO (2013–2019), Chairman (2015–2019), Executive Chairman (2020–Mar 2023), and Vice Chairperson (since Apr 2023) . Company performance context: 2024 Core FFO per share was $2.44, net income $183.3M; same-store revenues declined 3.0% and same-store NOI declined 5.5% YoY amid sector headwinds .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| NSA | CEO; Chairman; Executive Chairman; Vice Chairperson | 2013–present | Founded NSA; scaled multi-operator PRO platform; led internalization and transition to centralized property management . |
| SecurCare Self Storage | President & CEO | 2000–2014 | Grew SecurCare to 150+ properties; core foundation for NSA’s initial portfolio and operator model . |
| MMM Healthcare, Inc. | Founder | Prior | Built largest Medicare Advantage provider in Puerto Rico—demonstrates healthcare and insurance adjacency experience . |
| DuPont; Synthetech, Inc. | Managerial roles | Prior | Operational and financial management experience in industrials/chemicals . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Denver Seminary | Trustee; Chair of Finance Committee | Since 2019 | Financial oversight and governance leadership . |
| Reasons to Believe | Trustee; Chair of Finance Committee | Since Mar 2023 | Finance committee leadership supporting governance . |
Fixed Compensation
- Non-independent trustees receive no compensation for Board service; independent trustees are paid, but Mr. Nordhagen as Vice Chairperson (non-independent) received $0 in Board compensation .
Performance Compensation
- NSA’s long-term incentive framework for executives is 60% performance-based (relative 3-year TSR vs MSCI US REIT Index and self-storage peer weighted TSR) and 40% time-based (3-year ratable vesting). While this program is disclosed for NEOs broadly, Mr. Nordhagen is not a current NEO; his specific award detail is not disclosed in the proxy’s NEO tables .
- Internalization-related equity: On July 1, 2024, Mr. Nordhagen received 64,887 OP units (approximate value $2.6M at closing-date price) resulting from a noncontrolling investment in a former PRO affiliate; this is an equity alignment event tied to the internalization transaction rather than a regular incentive grant .
Equity Ownership & Alignment
| Metric | Value |
|---|---|
| Total beneficial ownership (Common Shares + OP units + DownREIT OP + vested LTIPs) | 6,488,498 |
| Ownership as % of shares outstanding | 8.2% |
| Common Shares (direct/indirect, including spouse/foundation) | 3,958,130 (incl. 145,504 via Nord Foundation) |
| OP units (direct/indirect) | 2,062,545 |
| DownREIT OP units (direct/indirect) | 463,261 |
| Vested LTIP units | 4,562 |
| Unvested LTIP units | 25,588 |
| Series A Preferred Shares (direct/indirect + foundation) | 24,066 + 8,689 (foundation) |
| Shares pledged as collateral | 600,000 Common Shares |
| OP units pledged as collateral | 1,469,012 OP units |
| Ownership guideline compliance | All officers and independent trustees complied as of Mar 14, 2025 |
| Hedging/Pledging policy summary | Hedging prohibited; pledging limited to the lesser of 50% of individual Common+OP holdings or 2.5% of outstanding Common Shares, with carve-out for threshold changes from Company repurchases . |
Note: NSA repurchased ~7.4M Common Shares in 2024, which can affect pledge thresholds per policy .
Employment Terms
- No individual employment agreement, severance, or change-in-control terms are disclosed for Mr. Nordhagen in the 2025 proxy. NEO employment terms are disclosed separately (not applicable here) .
Board Governance
- Role: Vice Chairperson; not independent; Board leadership is separated (Executive Chairperson: Fischer; CEO: Cramer; Lead Independent Trustee: Hylbert since 2016) .
- Family relationship: Brothers-in-law with CEO David Cramer, highlighted under trustee independence disclosures .
- Board and Committee service: Not listed on Audit, CNCG, or Finance Committee rosters; committees comprise independent trustees .
- Board activity and independence: Board held 6 meetings in 2024; all trustees attended ≥75% of meetings; 8 of 11 nominees are independent; independent trustees meet in executive session at least quarterly .
- Trustee compensation: Independent trustees receive base cash/equity and committee premiums; non-independent trustees receive none for Board service .
Director Compensation
- Independent trustee program (context): 2024 base cash $60,000, equity $100,000, plus committee/lead premiums; increased effective 2025 to $70,000 base and $120,000 equity with higher Audit Committee member fee. Non-independent trustees (e.g., Mr. Nordhagen) receive no Board compensation .
Compensation Structure Analysis (company program context)
- Pay-for-performance emphasis: NEO pay majority at-risk; relative TSR metrics for equity awards (MSCI US REIT and storage peers) with 50% threshold/100% target/200% maximum vesting calibrations; time-based LTIPs vest over 3 years .
- 2022–2024 performance LTIP outcome: NSA’s 3-year relative TSR ranked ~24th percentile vs MSCI US REIT Index and underperformed peers by 2,165 bps, resulting in zero vesting for that performance cycle on Jan 1, 2025 (for affected awards) .
- Clawback: Recovery policy adopted for erroneously awarded incentive compensation per SEC/NYSE standards .
- Ownership guidelines: Officers/trustees subject to minimum ownership multiples; full compliance as of Mar 14, 2025 .
- Consultant independence: FPC retained; compensation advisory fees $50,100 in 2024; additional Board recruitment/equity plan consulting $122,500; committee deemed independent .
Related Party Transactions (governance red flags)
| Item | Counterparty | Amount | Period/Note |
|---|---|---|---|
| Aircraft usage by Company | Entity owned/controlled by Mr. Nordhagen | $70,200 | FY 2024 . |
| Office lease rent | Entity controlled by Mr. Nordhagen (with shared interest by Mr. Cramer) | $97,380 (Mr. Nordhagen’s interest ~$55,380; Mr. Cramer’s ~$25,329) | FY 2024 . |
| Internalization consideration (OP units) | Mr. Nordhagen (via noncontrolling investment in former PRO affiliate) | 64,887 OP units (~$2.6M value at closing) | July 1, 2024 . |
Performance & Track Record (company-level metrics)
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| TSR – $100 initial investment (NSA) | $112 | $221 | $121 | $195 | $142 |
| TSR – $100 initial investment (Peer Group: Nareit All Equity REIT) | $95 | $134 | $101 | $144 | $118 |
| Core FFO per share | $1.71 | $2.26 | $2.81 | $2.69 | $2.44 |
| Net Income ($USD ‘000s) | $79,478 | $146,935 | $183,765 | $236,988 | $183,270 |
Additional 2024 operating highlights:
- Same-store revenues -3.0% YoY; same-store NOI -5.5% YoY (776-property same store set) .
- Portfolio actions: Acquired 25 facilities for $212.7M; sold 40 properties for net proceeds $273.1M; repurchased 7,400,322 Common Shares for $275.2M; authorized $350M buyback; established 2024 JV and contributed 56 properties ($346.5M) .
- Internalization executed July 1, 2024: Converted 11,906,167 subordinated performance units/DownREIT subordinated performance units into 17,984,787 OP units/DownREIT OP units; expected G&A savings and scalability .
Say-on-Pay & Shareholder Feedback
- NSA reports consistently high support for pay plans, averaging 97.3% over the last 5 years .
Equity Ownership & Alignment Details (policy context)
- Hedging prohibited; pledging allowed within defined thresholds with remediation if exceeded absent Company share repurchases; minimum ownership guidelines enforced with annual review and compliance confirmed .
Investment Implications
- High insider alignment with 8.2% beneficial ownership by Mr. Nordhagen, but significant pledging (600k shares and 1.469M OP units) introduces collateral-driven selling risk in adverse markets; monitor pledge levels relative to policy thresholds and any updates tied to share repurchases .
- Governance considerations include family relationship (CEO and Vice Chair are brothers-in-law) and related-party transactions (aircraft/office lease); balanced by supermajority independent Board, separation of Chair/CEO, and robust lead independent oversight .
- Incentive alignment at NSA emphasizes relative TSR; recent 3-year TSR underperformance led to zero vesting for that cycle, signaling discipline in performance awards; internalization awards aim at measurable G&A savings and platform migration milestones—positive for execution but not directly attributed to Mr. Nordhagen .
- 2024 fundamentals softened (same-store NOI/revenue down), but capital recycling, buybacks, and JV activity support long-term value; track Core FFO trends and TSR momentum as internalization benefits materialize through 2025–2026 .