Positioning for the Future

Michael T. Scanlon, Jr.President & CEO

SSA Polling Survey:

• SSA does owner-operator polling twice each year• We survey SSA members and non-members alike• We use these surveys to keep current with trends in

the marketplace• We use these data to develop educational programs

and convention session topics• We targeted this particular survey toward the future,

in line with our Fall Convention theme of “Positioning for the Future”

• This particular survey was conducted August 4, 2011• Surveyed 400 self storage owner-operators• Margin of error is less than 5%

SSA Industry Survey

• In what region of the country to you own / operate self storage facilities?

• Northeast 17.3%• Mid-Atlantic 5.3%• South 25.3%• Midwest 31.8%• West 17.5%

How Long Has Your CompanyBeen in Operation?

• Years in service:

– Less than 5 years 7.8%– 6–10 years 24.5%– 11-15 years 20.8%– 16 or more years 43.3%

How Many Facilities Do YouOwn, Operate and/or Manage?

• Number of facilities:

– One facility 63.5%– 2-9 facilities 23.8%– 10-24 facilities 2.5%– 25 or more 9.3%

Physical Occupancy TrendOver Trailing 12 Months?

• Occupancy:

– Occupancy INCREASED 29.5%– Occupancy DECREASED 18.5%– Stayed the same 49.3%– Not Sure/Refused/Other 2.8%

• NOTES: 41.1% of those with 2-9 facilities showed an increase; 40% of those with 10-24 facilities also showed an increase.

Have You Raised Rents on ExistingTenants in Previous 6 Months?

• Raised Rents?

– NO 83.5%– Yes, less than 2% 3.8%– Yes, 2% to 5% 7.5%– Yes, greater than 5% 2.8%– Not sure/Refused/Other 2.6%

• NOTES: 85.8% of those with 1 facility did not increase rents; 20% of those with 10-24 facilities DID increase rents by 2-5%

Growth via Acquisition, Development or 3rd Party Management?

• In the next 10 years, how many facilities do you think you will add to your current total (via 3rd party management, acquisition or development)?– Will not add any more 68.0%– Will own/operate FEWER 1.0%– Will add 1-4 more facilities 11.5%– Will add 5-10 more facilities 0.5%– Will add more than 10 facilities 2.3%

• NOTES: 22.1% of those with 2-9 facilities will add 1-4 facilities; 8.7% of those with 1 facility will add 1-4 facilities in the next 10 years

Development

• Do you plan to develop a new ground-up facility in the next 24 months?

– YES 5.5%– NO 85.3%– Unsure/Other 9.3%

• NOTE: 6.3% of those with 2-9 facilities plan a ground-up development in the next two years.

Expansion

• Do you plan to expand a current facility in the next 24 months?

– YES 15.3%– NO 73.5%– Unsure/Other 11.3%

• NOTE: 24.2% of those with 2-9 facilities plan to expand a facility in the next two years.

Acquisition

• Do you plan to acquire an additional facility in the next 24 months?

– YES 7.3%– NO 80.5%– Unsure/Other 12.3%

• NOTES: 16.2% of those firms with 25 or more facilities plan to acquire in the next 24 months; 10.5% of those with 2-9 facilities will do the same.

Third Party Management

• Is/are your facility(ies) currently managed by a third party?

– YES 5.0%– NO 87.3%– Unsure/Other 5.3%

• NOTES: Only 3.1% of 1 facility owners use a 3rd party management firm; 7.4% of 2-9 facilities owners do.

Future 3rd Party Management

• In the next 10 years do you think you might have another company (3rd party) manage one or more of your current facilities?

– YES 3.3%– NO 78.3%– Unsure/Other 13.5%

Yellow Pages vs. Internet/Web site

• What percentage of your new customers come to you via the Yellow Pages vs. the Internet / Web site?

• Yellow Pages Internet/Web

– Less than 10% 35.8% 41.8%– 10-20% 10.3% 12.8%– 21-40% 10.0% 12.0%– 41-60% 12.5% 7.3%– 61-80% 4.0% 3.5%– More than 80% 3.8% 2.3%– Unsure/Other 23.8% 20.5%

Social Networking

• Which of the following social networks do you use to promote your business?

– Google 51.1%– Facebook 25.3%– YouTube 3.8%– Linked-In 7.1%– Twitter 8.2%– MySpace 4.4%

• NOTE: Smaller firms tend to use Google more than larger firms.

Social Networking Budgets

• How much of your total marketing budget do you spend/expect to spend on social networking today vs. 10 years from now?

• Today In 10 years

– Less than 10% 71.3% 53.0%– 10-25% 3.8% 6.8%– 26-50% 1.3% 2.5%– 51-75% 0.5% 2.0%– 76-100% 0.3% 0.5%

Size of the Entire Industry

• In the future do you expect that the self storage industry will:

– Contract in size/be smaller 7.3%– Be about the same size 29.8%– Will grow by 10% in 10 years 38.0%– Will grow 20% or more in 10 years 10.3%– Unsure/other 14.8%

Debt

• Are you currently re-financing debt?

– YES 5.8%

– NO 80.0%

– Unsure/Other 14.3%

• NOTES: 5.1% of 1 facility firms are in a re-fi; 9.5% of 2-9 facility firms are in a re-fi.

Extended / Modified a Loan?

• Have you extended or modified an existing loan in the past 12 months?– NO 73.0%

– YES, modified 8.8%

– YES, extended 1.8%

– Unsure/Other 16.6%

• NOTE: Roughly 18% of firms with 2-9 facilities are modifying or extending a loan.

Raising Capital/Equity?

• Are you actively raising third-party capital or equity for new acquisition?

– YES 4.3%

– NO 77.0%

– Unsure/Other 18.8%

• NOTES: 2.8% of one facility firms are raising funds; 9.5% of 2-9 facility firm are too.

Business Attitude

• Which of the following statements best describes your business attitude?

– Very positive about the future of my business 54.0%– Somewhat positive 28.5%– Not sure about the future of my business 10.8%– Somewhat negative 2.0%– Very negative about the future 1.0%– Unsure/Other 3.8%

NOTE: The above percentages are consistent no matter the size of the company.

Thank You.

• You can download these slides from the SSA Web site upon your return home. Go to:

www.selfstorage.org

Right hand column under “Public Information”