SEGMENT INFORMATION

The Company’s segment disclosures present the measure used by the chief operating decision makers ("CODMs") for purposes of assessing each segment’s performance. The Company’s CODMs are comprised of several members of its executive management team who use net operating income ("NOI") to assess the performance of the business for the Company’s reportable operating segments. NOI for our self-storage operations represents total property revenue less direct property operating expenses. NOI for our tenant reinsurance segment represents tenant reinsurance revenues less tenant reinsurance expense.

The Company’s segments, prior to 2017, were comprised of three reportable segments: (1) rental operations; (2) tenant reinsurance; and (3) property management, acquisition and development. Based on how the CODMs reviews performance and makes decisions, the Company realigned its segments into two reportable segments: (1) self-storage operations and (2) tenant reinsurance. The self-storage operations activities include rental operations of wholly-owned stores. The Company's consolidated revenues equal total segment revenues plus property management fees and other income. Tenant reinsurance activities include the reinsurance of risks relating to the loss of goods stored by tenants in the stores operated by the Company. Excluded from segment revenues and net operating income is property management fees and other income.

For all periods presented, substantially all of our real estate assets, intangible assets, other assets, and accrued and other liabilities are associated with the self-storage operations segment. The prior periods have been restated to conform to the current presentation. Financial information for the Company’s business segments is set forth below:



	Year Ended December 31,
	2018			2017			2016
Revenues:
Self-Storage Operations	$	1,039,340		$	967,229		$	864,742
Tenant Reinsurance	115,507			98,401			87,291
Total segment revenues	1,154,847			1,065,630			$	952,033

Operating expenses:
Self-Storage Operations	$	291,695		$	271,974		$	250,005
Tenant Reinsurance	25,707			19,173			15,555
Total segment operating expenses	$	317,402		$	291,147		$	265,560

Net operating income:
Self-Storage Operations	747,645			695,255			$	614,737
Tenant Reinsurance	89,800			79,228			71,736
Total segment net operating income:	$	837,445		$	774,483		$	686,473

Total segment net operating income	$	837,445		$	774,483		$	686,473
Other components of net income (loss):
Property management fees and other income	41,757			39,379			39,842
General and administrative expense	(81,256		)	(78,961		)	(81,806		)
Depreciation and amortization expense	(209,050		)	(193,296		)	(182,560		)
Acquisition and other related costs⁽¹⁾	—			—			(12,111		)
Gain on real estate transactions, earnout from prior acquisitions and impairment of real estate	30,807			112,789			8,465
Interest expense	(178,436		)	(153,511		)	(133,479		)
Non-cash interest expense related to the amortization of discount on equity component of exchangeable senior notes	(4,687		)	(5,103		)	(4,980		)
Interest income	5,292			6,736			10,998
Equity in earnings of unconsolidated real estate ventures	14,452			15,331			12,895
Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase of partners' interests	—			—			69,199
Income tax expense	(9,244		)	(3,625		)	(15,847		)
Net income	$	447,080		$	514,222		$	397,089

(1) Beginning January 1, 2017, acquisition related costs have been capitalized due to the adoption of ASU 2017-01, "Business Combinations (Topic 805): Clarifying the Definition of a Business."