The COVID-19 pandemic may be waning, but the pandemic-fueled lift in business for the five publicly traded self-storage REITs is not.

During their first-quarter earnings calls, executives at the five REITs reported continued strength in occupancy rates, rental rates and revenue growth.

Despite the sunny results, however, financial analysts mostly downgraded the sector. Shares of the Big 5 storage REITs tumbled in tandem, each stock falling more than 20% from April 22 through May 9.

While the slump in the sales price might lead you to believe the REITs had fallen on tough times—at the moment it is quite the opposite. In fact, four of the REITs just boosted their same-store revenue outlooks for 2022. Only Glendale, CA-based Public Storage, the biggest of the REITs, didn’t adjust its revenue forecast for this year.

“We are off to a great start in 2022,” Scott Stubbs, chief financial officer at Extra Space Storage, said in a remark that could sum up the situation at all five REITs.

Here’s how four of the REITs tweaked their 2022 projections for growth in same-store revenue:

  • Malvern, PA-based CubeSmart. Previous guidance: 8% to 10%. New guidance: 8.75% to 10.25%.
  • Salt Lake City, UT-based Extra Space Storage. Previous guidance: 10.5% to 12.5%. New guidance: 13% to 15%.
  • Williamsville, NY-based Life Storage. Previous guidance: 9.5% to 10.5%. New guidance: 10.5% to 11.5%.
  • Greenwood Village, CO-based National Storage Affiliates Trust. Previous guidance: 8% to 9.5% increase. New guidance: 11% to 13%.

Marc Boorstein, principal of Chicago-based real estate brokerage and investment firm MJ Partners Real Estate Services, said the four REITs’ “very bold” forecast revisions came as a “real surprise.”

“The REITs are extremely optimistic,” Boorstein said. “But when they start the second quarter with occupancies in the mid-90s and they are seeing a lot of good trends in April, they think they can push rates on existing customers because there is still demand from new customers.”

Occupancy stays strong

“Overall, business is excellent and self-storage fundamentals remain at all-time record levels,” said Tamara Fischer, president and CEO of National Storage Affiliates, during the company’s earnings call.

“The sector is well positioned in an inflationary environment as a needs-based service with monthly leases that allow operators to adjust rates dynamically at a rent payment that represents a relatively small portion of our customers’ disposable income,” she said.

Much of the REITs’ optimism about robust revenue growth stems from occupancy rates that remain healthy. For instance, Life Storage reported a same-store occupancy rate of 93.7% as of March 31, down slightly from 94%…

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John Egan