Segment Information

12 Months Ended

Dec. 31, 2024

Segment Reporting [Abstract]

Segment Information

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. The Company’s segments are comprised of two reportable segments: (1) self-storage operations and (2) tenant reinsurance. NOI for the Company's self-storage operations represents total property revenue less direct property operating expenses. NOI for the Company's tenant reinsurance segment represents tenant reinsurance revenue less tenant reinsurance expenses.

The Company's consolidated revenues equal total segment revenues plus management fees and other income. The self-storage operations activities include rental operations of wholly-owned stores and self-storage units acquired in the Bargold transaction on June 1, 2022. 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 management fees and other income.

The Chief Executive Officer (“CEO”) is the primary CODM for self-storage operations, and the Chief Financial Officer (“CFO”) is the primary CODM for tenant reinsurance. The CODM for each reportable operating segment regularly reviews NOI to assess the performance of each segment and make decisions about resources to be allocated to each segment. As part of this process, the CODM approves each operating segment’s budget, determines allocation of funds for capital expenditures, and reviews monthly discrete financial information. Based on each segment’s budgeted operating revenues and expenses, resources are allocated to each segment, and these budgeted amounts comprising NOI are compared against actual segment performance.

For all periods presented, substantially all of the Company's real estate assets, intangible assets, other assets, and accrued and other liabilities are associated with the self-storage operations segment. Financial information for the Company’s business segments is set forth below:

	Year Ended December 31,
	2024		2023		2022
Revenues
Self-Storage Operations	$	2,803,252	$	2,222,578	$	1,654,735
Tenant Reinsurance	332,795		235,680		185,531
Total segment revenues	$	3,136,047	$	2,458,258	$	1,840,266
Operating expenses
Self-Storage Operations:
Payroll and benefits	$	170,529	$	127,300	$	94,005
Marketing	64,146		44,117		26,349
Office expense	123,604		97,621		74,400
Property operating expense	74,498		57,376		38,982
Repairs and maintenance	55,097		38,750		27,834
Property taxes	292,413		212,360		153,558
Insurance	32,892		25,466		14,636
Other segment items (1)	18,387		9,046		5,578
Total self-storage operations expenses	831,566		612,036		435,342
Tenant Reinsurance:
Tenant reinsurance expense and other segment items (2)	$	73,886	$	58,874	$	33,560
Total segment operating expenses	$	905,452	$	670,910	$	468,902
Net operating income
Self-Storage Operations	$	1,971,686	$	1,610,542	$	1,219,393
Tenant Reinsurance	258,909		176,806		151,971
Total segment net operating income:	$	2,230,595	$	1,787,348	$	1,371,364
Other components of net income:
Management fees and other income	120,855		101,986		83,904
Transaction costs	—		—		(1,548)
Life Storage Merger transition costs	—		(66,732)		—
General and administrative expense	(167,398)		(146,408)		(129,251)
Depreciation and amortization expense	(783,023)		(506,053)		(288,316)
Gain (loss) on real estate assets held for sale and sold, net	(25,906)		—		14,249
Impairment of Life Storage trade name	(51,763)		—		—
Interest expense	(551,354)		(419,035)		(219,171)
Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes	(43,720)		(18,786)		—
Interest income	124,422		84,857		69,422
Equity in earnings and dividend income from unconsolidated real estate entities	67,272		54,835		41,428
Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets	13,730		—		—

Income tax expense	(33,478)		(21,559)		(20,925)
Net income	$	900,232	$	850,453	$	921,156
(1) Other segment items for the Self-Storage Operations segment include miscellaneous items such as legal and professional fees, capital expenditures, taxes, and casualty losses.
(2) Tenant reinsurance expense and other segment items for the Tenant Reinsurance segment includes claims expense, acquisition costs, claims service fees and miscellaneous administrative items.