Public Storage

And welcome to Public Storage Third Quarter 2024 Earnings Conference Call. At this time, all participants are on a listen-only mode. A question and answer session will follow the formal presentation. If you'd like to ask a question at that time, please press star 1 on your telephone keypad. If anyone needs operator assistance during the conference, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Ryan Burke. Thank you. You may begin.

Thank you, Rob. Hello, everyone. Thank you for joining us for our third quarter 2024 earnings call. I'm here with Joe Russell and Tom Boyle. Before we begin, we want to remind you that certain matters discussed during this call may constitute forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to certain economic risks and uncertainties. All forward-looking statements speak only as of today. October 31, 2024, and we assume no obligation to update, revise, or supplement statements to become untrue because of subsequent events. A reconciliation to GAAP of the non-GAAP financial measures we provide on this call is included in our earnings release. You can find our earnings release, supplement report, SEC reports, and an audio replay of this conference call on our website, publicstorage.com. We do ask that you initially limit yourselves to two questions. Of course, after that, if you have more, feel free to jump back in queue. With that, I'll turn it over to Joe.

Thank you, Ryan, and thank you all for joining us today. Tom and I will walk you through our recent performance and updated views. Then we'll open the call up for Q&A. As we anticipated, operating fundamentals are stabilizing across our portfolio and the broader industry. We started the year with sequential revenue growth acceleration in a handful of markets. We are now achieving acceleration across most markets and expect the trend to continue. The improvement will be gradual and take some time to be fully reflected in our reported financial results. But as we'll discuss today, many things are moving in the right direction for public storage. In particular, pricing for new customers is stabilizing, with move-in rents down 9% year over year in the third quarter and down 5% in October. This is a meaningful improvement from the first quarter of this year when move-in rents were down 16%. Our in-place customers are also behaving very well. Payment patterns are strong, average length of stay is long, and move-outs are down year to date. All of this speaks to the convenience and affordability we provide to our customers. With move-in rents down nearly 30% since 2022, We have become even more affordable relative to other space alternatives, including moving into a larger home or apartment just to get the incremental space. Self storage is the affordable and convenient choice. The supply environment is also on a favorable path with deliveries of new competitive properties slowing further over the next couple of years. Less new competition will support operating fundamentals on top of the improving demand trends. We continue to focus on growth enhancing initiatives that are unique to us as well. Public storage customers are fully embracing the new and modern experience we've created by putting a full slate of digital engagement options in their hands. These options complement the service provided by our fantastic property managers, local teams, and customer care center representatives. The ability to choose between interacting digitally and in person is a major draw to customer seeking self storage today. I am proud of the entire team's efforts in creating the industry's most comprehensive hybrid digital operating model that cohesively connects our customers, team, and systems across field and corporate operations. And we're tracking ahead of schedule on our transformation with now 75% move-ins using eRental, our digital online lease. We have nearly 2 million PS app users and on a daily basis, tenants across our entire portfolio using our digital property access and remote customer service. The transformation is amounting to a win-win-win across our customers, team members, and financial performance. Through it, we have created more specialized and career advancing roles across the company. New opportunities for our property managers have been particularly well received as they now have career paths that aren't available elsewhere in the industry. Due in part to these efforts, we are proud to have received the Great Place to Work designation for a third year in a row. Another area of focus is utilities. We have reduced usage by 30% through conversion to LED lighting across the portfolio and installing solar power at more than 800 properties so far. We recently increased our solar goal to 1300 properties by the end of 2025. The team has innovated and implemented at a rapid pace over the past few years. We are fully in gear and are excited about more to come. Now, Tom will provide additional detail. Thanks, Joe.