National Storage Affiliates Trust

Greetings and welcome to the National Storage Affiliates first quarter 2020 conference call. At this time, all participants are on a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, George Hoglund, Vice President of Investor Relations for National Storage Affiliates. Thank you, Mr. Hoglund. You may now begin.

Good morning. I expect that most people on this call are working from home and spending more time at home in general, and you may have found the need to clear out some space for your home office, or if you're like me, your spouse has made you clean out the garage. I just want to remind you that self-storage is available to help you optimize your space needs. With that, we'd like to thank you for joining us today for the first quarter 2020 Earnings Conference Call of National Storage Affiliates Trust. In addition to the press release distributed yesterday, we filed an 8K with SEC containing our supplemental package with additional detail on our results and our 10Q, which may be found in the investor relations section on our website at NationalStorageAffiliates.com. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties, including Uncertainty related to the scope, severity, and duration of the COVID-19 pandemic and the actions taken to contain or mitigate the direct and indirect economic impact. The company cautions that actual results may differ materially from those projected in any forward-looking statement. For additional detail concerning our forward-looking statements, please refer to our public filings with the SEC. We also encourage listeners to review the definitions and reconciliations of non-GAAP financial measures such as FFO, Core FFO, and Net Operating Income contained in the Supplemental Information Package available in the Investor Relations section on our website and in our SEC filings. On the line with me here today are NSA's Executive Chairman Arlen Nordhagen, CEO Tamara Fischer, COO Dave Cramer, and CFO Brandon Togashi. All in prepared remarks, management will accept questions from registered financial analysts. I will now turn the call over to Tammy.

Thanks, George, and thank you everyone for joining our call today. First, I'd like to acknowledge and thank our pros and our many team members who've demonstrated their commitment and resilience in response to the demands of the novel COVID-19 induced crisis, which brings with it both health and economic related dimensions. I'd also like to formally welcome Dave Cramer, our new COO, to participation in his first earnings call. So welcome, Dave. You really picked a great time to start. By the way, as many of you know, while Dave is technically new to our NSA corporate team, he has decades of experience in self-storage, most recently as CEO of SecureCare. Dave and Arlen will both be available to answer questions during the Q&A session. Now, let me comment on the current environment and our response to the coronavirus pandemic. The health and safety of our employees and customers is our top priority. We've been actively addressing the rapidly changing environment and impact on our business, driven by the pandemic. All of our stores are open and operating in a modified manner for safety, including using face masks, protective barriers, and social distancing protocols. All properties have contactless rental options and we have halted rent increases and suspended auctions for the time being. Although 40% of our customers are on auto pay, we remain focused on cash collections and have had good success with those initiatives. We were very pleased that the year was off to a strong start, but the environment clearly began to change mid-March as the pandemic gained momentum and stay-at-home orders started to spread across the country. The dramatic economic slowdown that ensued has led to unprecedented job losses and although self-storage has historically proven recession resistant, it is not recession proof. The stay-at-home orders and rapid job losses have weighed heavily on our move-in volumes. Walk-in traffic during the height of the stay-at-home orders was all but eliminated. Of course, move-out volumes have declined significantly as well. Nonetheless, since this has happened during the typical beginning of our busy season, move-ins year-over-year from mid-March through April are down by 22%. Overall, this situation is still very dynamic, and given that we have limited visibility into the ultimate depth and breadth of these negative forces, we made the decision to withdraw our 2020 guidance at this time We will revisit this decision each quarter as the year progresses. In spite of the significant challenges currently facing the economy, we remain bullish on the self-storage industry generally and NSA specifically. In particular, we believe the industry is better positioned operationally today than we were at the time of the great financial crisis. Given the advances in internet marketing and sophisticated revenue management platforms, that provide large operators advantages in capturing and holding market share. We also think that NSA is well positioned relative to our peers given the downside protection inherent in our unique pro structure, our greater secondary and tertiary market exposure, and essentially no lease-up exposure. And finally, with just under $40 million of debt coming due through 2022 and $300 million of availability on our line of credit, we are well positioned to ride out this economic storm. On the external growth front, we acquired 36 wholly owned properties during the first quarter for a total investment of $223 million and two properties in our joint ventures valued at $12 million. The acquisition environment has slowed significantly with fewer deals in the market and, frankly, many buyers hitting the pause button for now. Our intention is to remain disciplined and strategic in our acquisition efforts with the objective investing when and where it makes sense for us for the long term. Finally, before I turn the call over to Brandon, I wanted to highlight the fifth anniversary of our April 2015 IPO. We talked then, as we have many times since, about the strengths and the benefits of our differentiated pro structure, which aligns the interests of some of the most successful private operators in self-storage with the interests of all of our stakeholders. Since our IPO, we have welcomed four new pros, invested approximately $2.5 billion in over 350 wholly owned properties, formed two joint ventures with initial portfolio values of nearly $2 billion and delivered sector-leading quarterly same-store NOI growth averaging about 7.5%. Combination of our internal and external growth has allowed us to increase our dividend by 74% since our IPO and to deliver sector-leading total shareholder returns from our IPO through the end of April of over 170%. We believe we've demonstrated the benefits of our differentiated structure, and as we enter this recession, the downside protection inherent in our structure will facilitate continued outperformance. I'll now turn the call over to Brandon to discuss operating results and balance sheet activity.