Not much left to say at this point, Best Idea Long CUBE completed the clean sweep for self-storage. 3Q21 Core FFO of $0.56/share was +$0.02/share vs. Hedgeye and +$0.03/share vs. Consensus. The two cent delta to our model was top-line driven above the NOI line, and both SSRev growth +15.6% (+220bp vs. Hedgeye) and SSNOI growth +21.1% (+270bp vs. Hedgeye) beat our numbers, so a clean beat and raise all around (see Figure 2 below for FY21 outlook changes). Quarter-ending occupancy in the SS pool down -130bp sequentially most closely resembled fellow Best Idea Long LSI vs. PSA/EXR with blended in-place rents up +14.4% similar to peers. We suspect LSI and CUBE will be most aggressive on pricing through the balance of the cycle with the most upside on rates relative to in-place. We want to hear on the call, to the extent possible, how much of the vacancy was created right at or close to quarter-end, as well as any insight on the pace of ECRI + roll-ups on new leases.
Figure 1: CUBE 3Q21 Earnings Variances
Figure 2: FY21 Guidance Changes
Please e-mail with any questions.
Rob Simone, CFA
Managing Director
Twitter: @HedgeyeREITs
