Extra Space Storage showed solid growth in its first quarter results and its common stock is selling strong with an over-allotment option being issued yesterday. The company has also announced a quarterly dividend of $0.14 per share on its common stock for the second quarter of 2011.
The dividend is payable on June 30 to stockholders of record at the close of business on June 15, 2011. Recently, Extra Space, which trades as EXR on the NYSE, sold 5 million shares of its common stock in a public offering and partially exercised its over-allotment of 335,423 shares with total net proceeds of about $112.9 million.
The company intends to use the proceeds from the offering to repay outstanding debt and fund potential property acquisitions, including a newly announced multi-property acquisition in Ohio for $39.5 million. Any excess proceeds will be used for general corporate purposes. Citigroup Global Markets Inc. is acting as the sole book-running manager for the offering.
The company’s announcement of operating results for the three months ending on March 31, 2011 contained the following highlights:
• Achieved funds from operations ("FFO") of $0.25 per diluted share including development dilution of $0.02 per share resulting in 31.6% year-over-year growth for the quarter.
• Grew same-store occupancy by 290 basis points to 85.4%, compared to 82.5% during the same period in 2010.
• Increased same-store revenue and net operating income ("NOI") by 4.2% and 5.8%, respectively, as compared to the same period in 2010. Same-store revenue and NOI include tenant reinsurance income and expenses.
• Completed four development properties for a total cost of $34.4 million.
• Added seven properties to the Company's third-party management platform.
• Paid a quarterly dividend of $0.14 per share.
"We are encouraged by another solid quarter of performance as we exceeded our guidance estimates and forecast for same-store growth,” commented Spencer F. Kirk, Chairman and CEO of Extra Space Storage Inc. in a press release. “ Stable rental activity, combined with lower customer vacates, has given our same-store properties their highest seasonal occupancy level since 2008. Extra Space has a multi-faceted growth platform for driving earnings growth through strong same-store performance, significant acquisition activities, a legacy development pipeline, an expanding third-party management business and a significant tenant insurance business. These components will combine to give us double-digit earnings growth in 2011."
Extra Space Storage, headquartered in Salt Lake City, Utah, is a fully integrated, self-administered and self-managed REIT that owns and/or operates 829 self-storage properties in 34 states and Washington, D.C. The Company's properties comprise approximately 550,000 units and approximately 60 million square feet of rentable space, offering customers a wide selection of storage solutions across the country, including boat storage, RV storage and business storage. The Company is the second largest owner and/or operator of self-storage properties in the United States and is the largest self-storage management company in the United States.
“Extra Space Storage Announces 2Q 2011 Dividend and Exercise of Over-Allotment Option.” Inside Self-Storage. May 24, 2011.
“Extra Space Storage Inc. Reports First Quarter 2011 Results.” Marketwire.com. April 27, 2011.
“Extra Space Storage Inc. Announces Exercise of Over-Allotment Option.” Yahoo Finance. May 24, 2011.