SMA

Greetings and welcome to SmartStop Self Storage Q1 2026 Earnings Call, at this time all participants are on listen-only mode. A question and answer session will follow the formal presentation. As a reminder this conference is being recorded. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question press star one again. I would now like to turn the conference over to David Corak, Senior Vice President of Corporate Finance and Strategy. Thank you. You may now begin.

Thank you, operator. Before we begin, I would like to remind everyone that certain statements made during today's call, including statements about our future plans, prospects, and expectations, may be considered forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act. These forward-looking statements are subject to numerous risks and uncertainties as described in our filings with the Securities and Exchange Commission, and these risks could cause our actual results to differ materially from those expressed in or implied by our comments. Forward-looking statements in our earnings release that we issued last night, along with the comments on this call, are made only as of today. The company assumes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. In addition, we will also refer to certain non-GAAP financial measures.

Information regarding our use of these measures and a reconciliation of these measures to GAAP measures can be found on our earnings release and supplemental disclosure that we issued last night and are available for download on our website at investors.smartstopselfstorage.com. In addition to myself, today we have H. Michael Schwartz, Founder, Chairman, and CEO, as well as James Barry, our CFO. I'll turn it over to Michael.

Thank you, David, and thank you for joining us today for our Q1 earnings call. I'll start with a few highlights of our Q1 results. We posted strong same-store revenue growth of 1.5%, NOI growth of 2%, and maintained average occupancy of 92.5% while facing our toughest quarterly comp of the year. Operationally, we posted very strong results despite recent geopolitical news. That said, 10 of our top 15 markets posted positive same-store NOI growth and good expense control led to a 30 basis point growth in our same-store operating margins. Likewise, other areas of our business outperformed expectations. We reported FFO as adjusted per share of $0.49, up 19.3% YoY.

In February, we've completed the recast of our $500 million syndicated bank facility at an all-in cost of about 30 basis points below the previous facility. We acquired a parcel of land in Canada that we intend to develop into Class A storage in our SmartCentres joint venture. Lastly,in March, we entered into a strategic joint venture with Axis Capital focused on providing bridge capital to self-storage sponsors across the U.S. In terms of guidance, we are now narrowing our same-store revenue growth from a range of -0.5%-2% to a range of -0.25%-1.75%. We're reducing our overall OpEx growth range from 2%-4% to 1.75%-3.75%.

The result is an increase of our NOI growth midpoint from a negative 40 basis points to a negative 25 basis points. Additionally, we are narrowing our FFO as adjusted per share of $1.93-$2.05 to $1.94-$2.04. Turning to operations, January and February were strong months for us, slightly above our initial expectations. In March, we saw a pullback in demand that directly coincided with the geopolitical news. This played through from the second week of March until about the second week of April when things really started to turn for the better. Demand has returned, and it appears rental season is upon us. We are still very early in the year, and in the self-storage business, rental season can end up impacting annual results.

That said, we are certainly encouraged going into the rental season. With that, I'll turn it over to James to discuss the quarter.

Thank you, Michael. Starting with our operating performance, our same-store pool posted YoY revenue growth of 1.5%, with operating expense growth of 60 basis points, leading to an NOI increase of 2%, with quarter-ending occupancy of 92.3%. While we did increase promotional utilization during the quarter, we were able to hold a solid average occupancy level of 92.5%, with limited increases in marketing spend in the Q1. Our achieved move-in rates per square foot were down 7% on average, while our move-in rates per unit were actually up 2% YoY during the quarter. As we moved into April, we grew our occupancy, ending April at 92.6%, only down 45 basis points YoY, and notably up 30 basis points from the end of March.

We were pleased with our operating expenses as well, with YoY growth of only 60 basis points in the same-store pool. This expense control led to an increase in our same-store margins of 30 basis points, the first YoY margin increase since 2023. We experienced a tailwind from FX during the quarter for the first time in a long time. Our 13 Canadian same-store assets post same-store revenue growth of 4.1% and negative 50 basis points on a constant currency basis. These results were in line with our expectations as the GTA had a 7% constant currency revenue comp in the Q1 of 2025, far and away our toughest comp of the year. In terms of our Asheville portfolio, our occupancy gap has narrowed dramatically since December, averaging down 260 basis points YoY in the Q1.

As of the end of April, we are only down 130 basis points YoY at 92.2% occupancy. That's notably up 220 basis points from the end of December 2025. On the external growth front, we acquired one parcel of land in Toronto within our SmartCentres joint venture that we intend to develop into Class A storage. Turning to our third-party management platform, we ended the quarter with 227 properties under management in line with our expectations. The result of all of this is that for the Q1 of 2026, we posted fully diluted FFO as adjusted per share and unit of $0.49. Lastly, turning to the balance sheet, during the quarter, we completed the recast of our $500 million syndicated bank facility, as Michael mentioned earlier.

That facility matures in February 2030 and has a one-year extension option, and the credit agreement has built-in language that would allow for a further pricing step down upon reaching an investment grade rating from S&P or Moody's Ratings. At quarter end, our Canadian FX exposure is fully hedged naturally from a cash flow standpoint, and 94% of our outstanding debt was fixed as of quarter end. SmartStop's balance sheet is positioned to access a wide variety of attractive capital sources, both in terms of debt and equity, to execute on future growth opportunities. With that, operator, we will open it up to questions.

Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question press star one again. Please pick up your handset when asking your question.If you are muted locally please,remember to unmute your device. Please stand-by as we compile the Q&A roster. Our first question comes from the line of Todd Thomas with KeyBanc Capital Markets. Your line is open. Please go ahead.

All right. Hi. Thanks. Good afternoon. Appreciate some of the details on April. Was wondering if you could just provide a little bit more detail on the move-in rent trends that you saw in April and the how the promotional activity trended?

Hey, Todd. It's Corak. As James mentioned, at the end of April, our occupancy was at 92.6%, down 50 basis points YoY. Our move-in rates on a unit basis were up about 1% YoY in April, while the move-in rents on a per square foot basis were down about 6.5% on a YoY basis. April ended up being a pretty good month overall, even with a sort of a slower start. We had a record number of web reservations, over 10,000 for April. Our call center broke an all-time high for rentals, which was kind of up 25% over last year with a really nice low abandonment rate, something that we take a lot of pride in.

The team has done a really good job of managing receivables, which is just a really good overall practice, but also creates, you know, more unit availability for rental season, which is a nice, you know, positive for us. I think we are really encouraged as we're getting into rental season here. Michael, do you wanna talk a little bit about Canada?

Yeah, absolutely. Thank you, David Corak. You know, from a Canadian perspective, on a constant currency basis, the same-store revenue was down about 50 basis points in the Q1. The comp that we had for Q1 2025 was 7%. We had a much tougher comp than in the U.S.. However, that's still 6.5% growth over a two-year period. I think in this environment, we think that's an excellent result. If you look at our joint venture properties that would meet our same-store definition, they actually did even better, at around 10% YoY revenue growth on a constant currency basis. At the end of April, our GTA same-store occupancy was 93.1%.

That was flat YoY, but slightly higher than the U.S. Meanwhile, our in-place rate, rates were actually up 1.5% YoY in April. Our outlook for the full year, in our GTA portfolio, it will perform slightly better than our U.S. portfolio in 2026, even with the tougher comps.

Okay. In the quarter, can you speak to the increase in vacate activity that you experienced? You know, what was that attributable to? Was there anything notable that occurred on the move-outside during the period?

Todd, this is James. I'll jump in and just say, first of all, there's a couple things going on with the increase in vacates. First and foremost, we were coming off a tougher comp. Q1 of 2025 was down YoY in vacates, there is a cycling of that comp. In addition, as we mentioned in our prepared remarks, we did see an uptick in vacates really starting at the beginning of March with some of the geopolitical uncertainty and some consumer decisions. You know, that's abated since, you know, since the first two weeks of March, that's what's driving the Q1 increase in vacates.

Okay. All right. Thank you.

Thanks, Todd.

Your next question comes from the line of Viktor Fediv with Scotiabank.

Yeah.

Your line is open. Please go ahead.

Thank you. Good afternoon, everyone. I have a question on Argus Professional Storage Management platform. You have full quarter, Q1 now. How has the operational integration gone, and were you able to identify potential synergies for SMA as a whole, and what is the expected timing for those?

I'll jump in first. This is James. On the expense side and integrations, you know, clearly it's been six months since the close, and, you know, we've been doing a lot of processes in terms of migrating employees over into the SmartStop platform. In addition, as it relates to the Q1 results and our expenses there's a lot of seasonal effect.

We had multiple conferences that all take place in the Q1, including our owners conference, which we talked about on our last earnings call. That doesn't happen, you know, in, over the course of, over the next couple of quarters. That's an annual event. We would expect the margins to increase from here. I think it's still going to take a handful of quarters and even into 2027 before we start to really see the operating margin synergies. Although we're starting to see them in smaller pockets such as Denver, where, you know, we've quadrupled our overall store count between SmartStop managed, SmartStop legacy, as well as the private label properties under the Argus platform.

Good.

Yeah.

Just to follow up on, Oh, sorry.

This is Michael. I was going to jump in there and just say that, you know, I think the integration has been going well. There's been a significant amount of technology upgrade for our third party owners, which has been incredibly positive. We actually have signed up our first Canadian property in the Greater Toronto Area. We have a nice pipeline of existing private label owners who now see the power of SmartStop Self Storage with respect to the top of the funnel. Those properties that we ported over, those owners are incredibly successful. Some of them are generating more leads than they ever have on a private label basis.

We think, you know, over the next 12 months, we will start to see, you know, a strong migration from our private label platform to either the legacy or the full-blown SmartStop platform. You know, we're really, I think, pretty excited about the integration, the people and the ability to keep growing this in the future.

Thank you. Thank you for additional color. I have a follow-up on move-out trends. I appreciate the details on move-in side in terms of the sizes of units that are involved there and can you provide some additional details on move-outs in terms of what sizes were more heavily impacted in Q1?

When we look at the move-outs in terms of the average size, it's really in line with our portfolio average. What's unique is that the move-ins were renting more of the larger units, but the move-outs are not matching that same disconnect, right? On a YoY basis, it's pretty consistent on a year, you know, move-outs Q1 2026 versus Q1 2025 in terms of the size of the units.

Understood. Thank you.

Thanks, Viktor.

Your next question comes from the line of Eric Luebchow with Wells Fargo. Your line is open. Please go ahead.

Great, thanks for taking the question. Maybe you could talk a little bit just about the acquisition environment. I know you're a little more restricted in what you can do, wholly owned on balance sheet this year, but maybe update us on the discussions around an institutional JV partnership and how those conversations are trending.

Okay. You know, I'll jump in here. Well, let me just start by saying that, I've been doing this a very long time. From an acquisition perspective, I think this is one of the, I think, single greatest opportunities to transact in self storage since the Great Recession on a risk-adjusted basis. You have a lot of markets that have readjusted from a rate perspective down, you know, 25%, you know, 35%, you know, %. You know, we think that there's a really nice, you know, recovery of acquiring at really solid cap rates with either management upside and/or, you know, rate upside.

There's a lot of groups out there that acquired at very aggressive cap rates in 2021, 2022, and probably half of 2023 at 4%. They had short-term debt, and some of them even had bridge loans, and they've had to extend those loans. Now you're facing an environment where they're no longer willing to extend and pretend. This is a result of creating a really nice wave of high quality properties that are coming to sale because the owners are currently out of options. We're seeing a lot of attractive opportunities on the stabilized front in the U.S. and also Canada.

The deals that we've closed I think are great examples of this, and I think, we are continually encouraged about the current pipeline, you know, deal flow, you know, out there. There are some, larger portfolios out there, but there's also, you know, enough onesies and twosies. I just wanna emphasize that a lot to us may not be a lot to others. For every $300 million that we can acquire, it increases our market cap by approximately, you know, 10%. As you guys are probably well aware that we acquired about $370 million in 2025, about $500 billion since 2024, and that's meaningful, I think, growth for us. It's enough for us to move the needle.

You know, and it obviously benefits our size. We are still seeing, a healthy amount of aggregate, you know, opportunity. I think from that perspective, you know, we feel pretty good. The second part of your question was?

Yeah, just around institutional JV and how those discussions are coming along.

No, those discussions are happening, as we speak. I think they're coming along nicely. Obviously, as you know, we have a very solid institutional joint venture with SmartCentres on the development of self storage in Canada. Obviously, we're looking to kind of expand that for existing either lease up or stabilized properties. We're out there trying to find the right partner. As you can imagine, we currently have a lot that we are doing on a daily basis. We're gonna take our time to find the right capital partner that for the long term.

Great. Just one follow-up on the shaping of same-store revenue growth this year. I know you have some tough comps in Asheville, although it sounds like you've gotten a lot of that occupancy back. Some hurricane comps in markets like Tampa, and then the L.A. rent restrictions. Maybe kind of putting it all together, you could kind of talk about the shaping of same-store revenue growth the next couple quarters that's embedded in your guide and some of the call-outs on those, on those items. Thank you.

Yeah. Thanks for the question, Eric. It's correct. So,you know, when you look at the comps last year, obviously the Q1 was our toughest comp at 3.2%. The comps are significantly easier in the Q2 and Q3, gets a little bit harder in the Q4. Just on that alone, one would think that, you know, second and Q3 will probably be our best quarters of revenue growth YoY. Obviously, that's not exactly what the guidance would imply at this point on the midpoint. The other two things that are impacting the cadence of same-store revenue growth are, as you pointed out, Asheville and the ECRI restrictions in L.A..

Obviously in Asheville, we were coming off of a, you know, a really strong year, right? We lapped that comp. As you get into the Q1, we were still positive in terms of rates, but negative in terms of occupancy. However, as you get into the Q2, you know, that rate, the rates will turn negative on a YoY basis and will continue to be negative through, you know, the Q2 and Q3, again, on a YoY basis. The comp gets a lot easier in the Q4 as you sort of lap that. The other element is, of course, on the L.A. restrictions.

We are not assuming that the restrictions will be lifted for 2026. There's a compounding effect that happens there, where, you know, the Q2, the impact is worse than the Q1, and then the Q3 is worse than the Q4, and so on. Those are the other kinds of things that are impacting the shape of the curve overall. You know, Asheville is in an interesting spot. Michael, do you want to talk a little bit about where Asheville stands today?

Yeah, absolutely. Obviously in the Q4, we talked about Asheville. I think as we position and where we're at today, Asheville was our best performing market in 2025. We had 6% same-store revenue growth YoY. We are obviously facing some tough occupancy comps in 2026. The YoY occupancy gap has narrowed dramatically. I think James discussed this a little bit. Since December, our average is down only 260 basis points YoY. In the Q1, our occupancy was at 91.6%.

At the end of April, we were only down 130 basis points, and we're settling at 92.2%. That's a great position to be in as we move into the busy season. That's notably up 200 basis points from the end of December and generally in line with the rest of our U.S. portfolio, which is, you know, positioned nicely also. This is a fairly traditional cadence of occupancy for a natural disaster of this kind, and we are now at a post natural disaster stabilized occupancy level. Overall, we still expect Asheville to be a relative underperform in 2026, specifically through the end of the Q3. That being said, the portfolio is performing slightly better than expected through April.

I think that says a lot about our technology, our process. You know, we were able to capture that upside with respect to occupancy and rate. As occupancy pulled back, we were able to refill that funnel, stabilize the physical occupancy, and get it prepared for the busy season.

All right. Thank you, guys.

Your next question comes from the line of Michael Mueller with J.P. Morgan. Your line is open. Please go ahead.

Yeah. Hi. Two questions. I guess, on the first one, I apologize if I missed this, but can you talk about the move-in rate expectations for the balance of the year compared to, I think it was about 6.5% down, you said in April. You know, from higher level perspective, how should we be thinking about a bridge loan pref program? You know, how it fits into the business? Can it be a needle mover going forward, et cetera? Thanks.

Hey, Mike. I'll give you kind of the operating assumptions. We went over these slightly last quarter. I'll review them. They really haven't changed. From a move-in rent standpoint, obviously we have a handful of markets, some markets that have already turned positive this year, other supply markets still sort of negative. Our assumption is that by the end of rental season, so call it end of August, September, we'll on the whole be largely back to a neutral kind of inflection point. If we don't get back there, right, it doesn't have a material impact on the rest of the year. We'll have some impact on obviously the Q3 and Q4.

From an occupancy standpoint, we are modeling, you know, kind of fairly flat to slightly positive relative to 2025, with the exception of Asheville, obviously. For the rest of the portfolio, you know, think about sort of, you know, fairly flat to maybe slightly positive. ECRIs we're, you know, modeling at or better than levels in 2025, which is basically what we've been doing given the strength and the health of the existing customer. The exception, of course, being the, you know, the California wildfire impacted properties, which we assume are gonna be impacted for the full year. I'll remind you our length of stay is actually up year over year, which is a trend that us and some of our peers are seeing, which is really good from that perspective.

On the supply front, we're obviously, you know, like everyone else assuming that the supply impact, you know, decreases throughout the year. In terms of your second question, Mike, on Axis and the bridge lending. Let me give a little bit of background on the relationship and talk about sort of the pipeline and how we're looking at deals and what we're looking at. Axis is a portfolio company of Conversant Capital. For some background, they run an institutional commercial real estate finance platform. Michael and the principal of Axis have a very long-standing relationship, this is not something that was just sort of thrown together overnight. This was, you know, well thought out for a long time.

Axis, their role in this relationship, you know, will help us source, structure, and service bridge loans, investments, et cetera, and they will be a 5% participant in the JVs investments. The partnership, you know, for us, gives us the horsepower to grow our bridge lending business efficiently without burdening our G&A, essentially, right? We're really excited at this, right? We're excited at the potential of the partnership and sort of the synergistic relationship that the program will have on third-party management and our overall external growth trajectory. When you think about the pipeline overall, it's very strong. We're very pleased with it in where it stands today. We're actively looking at over $100 million of deals with average yields of 10%-14%.

Obviously, just like an acquisitions pipeline, we're not gonna close on those $100 million deals, but our pipeline is filled with really strong deals and markets that we like, with sponsors that we, you know, we generally like. What we're typically looking at some sort of mezz or pref position on a deal that already has senior debt on it or is in market with senior debt. We would also do sort of the A note, B note approach, but the pipeline is really dictating the former strategy. The pipeline is a mix of recaps, acquisition financing, development deals, and though I'll note our, you know, we're particularly selective on any new development deals. A ton of potential on this front. Obviously working off of a very small denominator.

We really like the risk-adjusted returns on a lot of these deals that we're going after, but are certainly sensitive to the, you know, the quality of the property, the quality of the sponsor, the impact on our leverage, and then obviously, you know, the overall, you know, quality of our earnings.

I would just add that also it's opening up an additional third-party property management assignments.

Got it. Okay, thank you.

Thanks, Mike.

Your next question comes from the line of Mason Guell with Baird. Your line is open. Please go ahead.

Hey, thanks for taking my question. On the expense side, what drove some of the favorable expense growth, and then kind of what is driving the higher expected growth for the remainder of the year kind of compared to the Q1?

Yeah, I'll jump in there. You know, in terms of the Q1 and some of the favorable comps there is, we had a good number on our property tax line item, which is obviously our single largest expense line item. That came in at a pretty nominal level. We also had, as we've talked about on the insurance front, we have not only realized the benefits of a strong general liability renewal that took place in November of 2025, and that's carrying forward for a whole year. In addition, we also had a very strong property renewal that took place at the beginning of April.

It's not in our Q1 numbers, but it is part of that, and it's the main reason behind our OpEx guide down, is those savings on that property insurance renewal. Part of the offset and part of the reason we were still positive is we had some weather-related expenses both in utilities and R&M. And our payroll is at a nominal level, we'll call it, you know, in the low to mid-single digits. I'll also note that advertising was up about, call it 1.9% for the quarter on a YoY basis, but that's a lever that we wanna, you know, potentially be strategic with in terms of the trade-off, in terms of getting new rentals between concessions, pricing, and marketing.

You know, that's something we wanna keep that flexibility on. That's the overall shape of the OpEx, but we felt really good about that property insurance renewal, and that allowed us to reduce the OpEx guide.

Great. Could you talk about what drove the higher managed REIT EBITDA guide and how that segment has been performing?

I'll also jump in there. Overall, the recurring revenues from that overall portfolio in the managed REIT platform, as a reminder, those assets are largely unstabilized, right? They grew at an outsized pace relative to, for example, our same store portfolio growth rate. Those revenues came in higher than our expectations. Cumulatively, we're talking about an annualized run rate in the Q1 on revenues in the managed REIT platform of, you know, just over $16 million on an annualized basis. Right. That's a really powerful base of recurring revenues for SmartStop.

Got it. Thank you.

Thanks, Mason.

There are no further questions at this time. I would now like to pass the call over to Michael Schwartz, Chairman and CEO, for closing remarks. Please go ahead.

Thank you. It's been a solid Q1 for us, I wanna thank you for your time and interest in SmartStop Self Storage, The Smarter Way to Store. Have a great day.

This concludes today's call. Thank you for attending. You may now disconnect.

Hello, everyone. Thank you for joining us, welcome to the SmartStop Self Storage REIT Fourth Quarter 2025 Earnings Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. I will now hand the call over to David Corak, Senior Vice President of Corporate Finance and Strategy. Please go ahead.

Thank you, operator. Before we begin, I would like to remind everyone that certain statements made during today's call, including statements about our future plans, prospects, and expectations, may be considered forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act. These forward-looking statements are subject to numerous risks and uncertainties as described in our filings with the Securities and Exchange Commission. These risks could cause our actual results to differ materially from those expressed in or implied by our comments. Forward-looking statements in our earnings release that we issued last night, along with the comments on this call, are made only as of today. The company assumes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. In addition, we will also refer to certain non-GAAP financial measures.

Information regarding these financial measures or use of these measures and a reconciliation of these measures to GAAP measures can be found in our earnings release and supplemental disclosure that were issued last night and are available for download on our website at investors.smartstopselfstorage.com. In addition to myself, today we have H. Michael Schwartz, Founder, Chairman, and CEO, as well as James Barry, our CFO. Now, I'll turn it over to Michael.

Thank you, David, thank you for joining us today for our fourth quarter earnings call to close out the year as a New York Stock Exchange-listed company. I'll start with some introductory remarks on SmartStop and the industry before I hand it over to James to discuss the quarter. After that, we'll open it up for Q&A with James, David, and myself. Before we dive into the high-level remarks, a few highlights of our fourth quarter results. We posted a strong fourth quarter with same-store revenue growth of 40 basis points, an average occupancy of 92.3%. This capped off a year of sector-leading revenue growth of 1.6%, with average occupancy of 92.5%. Operationally, we were pleased with how the quarter started, the last six weeks of the year came in below our expectations.

We saw a more competitive pricing environment, paired with a higher-than-expected move-outs in several markets, most notably Asheville. 10 of our top 15 markets posted positive same-store revenue growth, and other areas of the business outperformed expectations. These included our recently acquired third-party management platform and property operating expenses. We reported FFO as adjusted per share of $0.55, up 29.8% year-over-year. For the full year, we reported FFO as adjusted per share of $1.87, up 10% from 2024.

We introduced our 2026 guidance, highlighted by same-store revenue growth of -50 basis points to +2%, NOI growth of -1.8% to +1%, and FFO as adjusted per share of $1.93 to $2.05, representing about a 6% growth on the midpoint. We had another robust quarter of activity. During the quarter, we acquired one Class A operating property on balance sheet in Orlando MSA, and a parcel of land in Canada that we intend to develop into a Class A storage in our SmartCentres joint venture. Our acquisitions have been Class A assets located in top markets. For the full year, our acquisitions totaled $369 million, inclusive of the Argus transaction.

Our managed REITs acquired four properties during the quarter, resulting in AUM at year-end of over $1 billion. That represents over $200 million of AUM growth in 2025. We also completed our first bridge capital investment, structured as a preferred to a third party for approximately $5 million, sourced through our third-party platform. Last, but certainly not least, we closed on Argus Professional Storage Management, bringing on board over 220 managed properties and 400 employees to the SmartStop team. Between Argus, our lending business, and our on-balance sheet acquisitions, we deployed about $61 million of capital during the quarter. We've stayed busy into 2026, recently completed the recast of our $500 million syndicated bank facility at an all-in cost of about 30 basis points below the previous facility.

We recently added Wayne Johnson to our Board of Directors. Many of you know Wayne from industry and the sell-side conferences over the years. He's a 30-year veteran of self-storage, and he and I have been working together for 20 of those years. He has been a key leader in the company's growth since its formation, and we're thrilled to welcome him to our board. Turning to the industry. On the operations front, 2025 was incrementally better than 2024, but certainly not as strong as a more normalized year in storage. We continue to believe that the recovery in storage is happening, but the choppiness in customer demand continues, as evidenced by our second and fourth quarter results. However, our strategy to maintain and build occupancy is working.

In the fourth quarter, we had another record-setting quarter of lead conversions, both online and through our call center. Reservations remain strong. We also posted the highest penetration rate on tenant protection in our company's history. The number of our customers on auto pay is up 250 basis points year-over-year. Our customers' health remains strong. Delinquencies remain at below average levels, and in fact, are down year-over-year. ECRIs remain healthy without change in attrition. Our length of stay slightly increased for the first time since the COVID era. Industry move-in rates continue to stabilize, but are still negative year-over-year, though significantly less negative than the previous 2 years. Those trends have continued into the new year. The demand is there, but it's driven by lower asking rents.

Move-in rents are down 8% year to date in 2026 across our same store portfolio. We have seen healthy increases in our overall occupancy, sitting at 92.8% today, even with some headwinds in hurricane markets. Our outlook for 2026 is thematically consistent with our original outlook for 2025. Improving supply picture should lead to a slightly better year than the prior year, with continued uncertainty and choppiness around demand. We still remain optimistic on the sector's slow and steady recovery in 2026. However, our guidance does not take into account a meaningful recovery of the U.S. single-family home market, nor any material changes in the broader economies in either the United States or Canada.

We also have a variety of capital deployment options at attractive returns at our disposal that we can execute on both in the near term and at an accelerated pace, given an improved cost of capital. For 2026, we're targeting an overall capital deployment range of $72 million-$96 million, consisting of acquisitions, bridge capital, development in our SmartCentres joint venture, and redevelopment and expansion projects. We are also investing in our technology platform, including our internal artificial intelligence capabilities, which have been and will continue to be a focus for us in 2026. We see a tremendous growth opportunity in third-party management, both in the U.S. and Canada, as well as through our multiple product offerings in the managed REITs.

Lastly, our guidance does not contemplate the formation of an institutional acquisitions joint venture, which is a priority for us in 2026. Taking a step back, we have accomplished a tremendous amount in our short time as a publicly traded company. Without a doubt, we are in a choppy self-storage market, with volatile capital markets and plenty of uncertainty in the broader economic environment. However, through all the choppiness, we have executed exceptionally well on the things that are within our control. With that said, our focus in 2026 is as follows: disciplined capital allocation strategy, which includes on-balance sheet acquisitions, development in our SmartCentres joint venture, expansions, redevelopments, and solar investments, bridge lending to support our third-party management business, technology platform, including artificial intelligence, and a potential acquisitions joint venture.

In addition, a focus on growing our third-party management business, the managed REITs, continued balance sheet optimization, and last but not least, executing on our property operations strategy. SmartStop's accomplishments over the past 10 months have built a strong, solid foundation for future growth to take advantage of an improving self-storage landscape. With that, I'll turn it over to James to discuss the quarter.

Thank you, Michael. Starting with our operating performance, our same store pool posted year-over-year revenue growth of positive 40 basis points, with operating expense growth of positive 2%, leading to an NOI decrease of 30 basis points. The FX impact from our 13 Canadian same-store assets was effectively flat for the quarter, with no change on a constant currency basis for the entire same-store pool. Revenue growth was below our expectations for the quarter, we were able to make up some of the underperformance with better-than-expected property operating expenses. This was due to some wins on property taxes, improvement in property and general liability insurance premiums, as well as muted advertising spend. We accomplished same-store revenue growth with limited marketing dollars, while maintaining strong occupancy of over 92%.

Our same-store pool ended the quarter at 92.1% occupancy, down 10 basis points year-over-year, while average occupancy was 92.3%, up 10 basis points year-over-year. These stats speak to the trends that Michael mentioned in his opening remarks regarding an increase in move-outs in the back half of the quarter, specifically in Asheville, which was facing a tough fourth quarter comp due to the impact of Hurricane Helene in October 2024, and saw a large decline in occupancy in November and December, ending the year down 540 basis points in physical occupancy. This drop was more than we had anticipated in previous guidance. Broadening out, the pricing environment in fourth quarter was more competitive than expected from both institutional and smaller operators.

Accordingly, we used concessions and discounting more than we had in the first nine months of 2025. Our web rates were down about 8% year-over-year for the fourth quarter, while our achieved move-in rates were down 11% on average. We moved into the first quarter of 2026, we once again put a strong emphasis on maintaining physical occupancy throughout the slow season. In doing so, we actually grew our occupancy, ending January at 92.7%, up about 60 basis points year-over-year, and more notably, up 60 basis points from the end of December. We moved into February, we stand at about 92.8% occupancy through this past weekend, roughly flat year-over-year, while move-in rates are down only 1% year-over-year.

On the external growth front, we acquired one Class A operating property on balance sheet in the Orlando MSA, as well as one parcel of land in Toronto within our SmartCentres joint venture, that we intend to develop into Class A storage, and of course, Argus Professional Storage Management. For the full year, our acquisitions settled approximately $368 million, inclusive of the Argus transaction. Turning to the managed REIT platform, our three managed REIT funds, inclusive of the 1031 eligible DST programs, ended the quarter with over $1 billion of assets under management. In the fourth quarter, we recognized gross fees of approximately $4.1 million. The managed REITs have a combined portfolio of 52 operating properties and approximately 4.5 million net rentable sq ft as of quarter end.

We also increased our loans and preferred investments to the managed REITs by approximately $20 million. The DST programs continue to successfully raise equity, and we are excited that SST X closed on its first property as that program gets up and running. Turning to our third-party management platform, we ended the quarter with 221 properties under management, in line with our expectations. EBITDA, net of acquisition expenses for the quarter, was approximately $670,000, and we continue to have near zero levels of unknown attrition, both on the property side, and no attrition on the employee side. The result of all of this is that for the fourth quarter of 2025, we posted fully diluted FFO as adjusted per share and unit of $0.55.

Turning to 2026 guidance that we provided last night, I'll give color on a few major pieces. We are expecting same-store revenue growth in the -50 basis points to +2% range, with operating expense growth in the 2%-4% range, resulting in an NOI growth range of -1.8% to +1%. For our non-same store properties, we're expecting NOI of between $18.5 million and $19.8 million. We are expecting managed REIT EBITDA of $13.3 million-$13.9 million. For third-party management, we are assuming EBITDA of $1.8 million-$3 million, in line with our yield communicated when we closed the transaction. I will note that we are allocating about $250,000 of SmartStop's G&A to third-party management expenses.

For G&A, we are expecting a range of $32 million-$34 million. In terms of capital deployment, first, we are expecting to deploy between $45 million and $65 million between acquisitions and bridge lending for full year 2026. Second, we plan to spend about $10 million on development of properties under construction within our SmartCentres joint ventures. Third, we are expecting to spend about $2.5 million on our solar initiative. Lastly, we began expansion or redevelopment projects on a handful of already owned facilities with an estimated spend of $16 million-$18 million. This does include the redevelopment of the vacated industrial space at our Newark, New Jersey, facility. The result of all of these updates is that we are guiding to an FFO as adjusted per share range of $1.93-$2.05.

Lastly, turning to the balance sheet. In October, we closed on a CAD 160 million term loan within our SmartCentres joint ventures, of which we are 50% owners. The loan is a five-year term and bears a fixed interest rate of 3.87%. We used the proceeds to pay off all of the prior existing JV level debt, which had an weighted average cost of 5.7%. With that JV debt issued in October, we have fully hedged our Canadian FX exposure naturally from a cash flow perspective. Additionally, 95% of our outstanding debt was fixed as of year-end. As Michael mentioned, our work on the balance sheet continued into 2026. Last week, we completed the recast of our $500 million syndicated bank facility. The facility matures in February 2030, with a one-year extension option.

Our all-in cost to borrow came down about 30 basis points based on a reduced pricing grid, and is one of the most competitive executions on the borrower side with leverage-based pricing. The credit agreement also has built-in language that would allow for a further pricing step down upon receiving an investment grade rating from S&P or Moody's Rating Services. The work that we've done on our balance sheet represents a tremendous accomplishment, putting SmartStop well ahead of a typical REIT in its first year on an exchange. The transformation of the balance sheet since the IPO sets us up well to execute on any growth opportunities moving forward. With that, operator, we will open it up to questions.

We will now begin the question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. Please pick up your handset when asking a question, and if muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Our first question comes from Viktor Fediv with Scotiabank. Your line is open. Please go ahead.

Thank you very much for taking my question. What are your baseline assumptions for move-in rate and ACRI at midpoint of same-store revenue guide? How should we think about cadence of move-in rate growth throughout the year?

Hey, Viktor, it's Corak. I don't wanna give exact building blocks, but I'll give you a little bit of a framework for 2026. on the move-in rent front, you know, we'll give some more color on this, but, you know, some of the markets have already turned positive. A little bit over half of our markets have turned positive year-to-date in terms of year-over-year move-in rents. There's other markets that, you know, supply markets that are still negative. You can probably imagine that Asheville is still negative and skewing some of those numbers. We think by sort of the end of rental season, on average, we'll largely be back to a neutral sort of inflection point.

On the occupancy front, you know, we're forecasting, you know, slightly positive results relative to 2025. Obviously, there's a big exception in there with Asheville, but that should, you know, kind of clean up as the year goes on. You know, we are up in occupancy year to date on an average basis, and we would expect that to sort of level out over the course of the year. In terms of ECRIs, you know, we're modeling out, you know, an at or better than 2025 levels, given the strength and the health of the existing customer. The exception there, of course, being the California wildfire-impacted assets, which we assume, as Michael mentioned, will be impacted for the full year.

Got it. A quick follow-up on your Q4 results. Obviously, your move-out volume was largely impacted by Asheville, but what was the actual achieved move-out rate for the average Q4?

You're talking about specifically for Asheville, or are you talking about for the entire portfolio?

For the entire portfolio.

Yeah, the move-out rate in December, and just on a monthly basis is about $1.39. Yeah, for the entire quarter of fourth quarter, our move-out rates were down about 5% on a year-over-year basis. They were down.

Got it. Thank you.

Thanks, Viktor.

Our next question comes from Juan Sanabria with BMO Capital Markets. Your line is open. Please go ahead.

Hi. Good morning. Just hoping you could talk a little bit about your joint venture strategy and the opportunities that you're looking at, whether the focus would be in the U.S. or Canada. Would you contribute any on-balance sheet assets, and kind of where you see cap rates today in the market?

Yeah, it's a great question. I mean, I think, from an acquisition perspective, there's just a tremendous amount of opportunity out there. I think, you know, from my perspective, I think it's one of the better overall aggregate transaction environments than we've seen, since, you know, the Great Recession. We are seeing a tremendous amount of high-quality deals either built and/or acquired at the wrong time, during kind of the highs of COVID with low cap rates and rental rates that were a lot higher. Then some of them with variable debt, some of them with, you know, bridge loans attached to them. The pretend and extend seems to be over.

Those kind of transactions come in the market, you know, based on our thesis that storage has, you know, bottomed and/or bottoming. I think there's a really nice, I think, risk proposition with respect to acquiring these, you know, top 25 markets. You know, we're looking for, you know, an institutional joint venture, a partner in the U.S. on acquisitions that can kind of complement, you know, what we've already built, you know, within our platform, and obviously provide, you know, a, you know, accretive returns to our overall and our aggregate shareholders. A lot of opportunities, from onesies to twosies to small portfolios.

You know, we've been, I think, more active, I think, in the last nine months, and we've been receiving a ton of calls with respect to people wanting us to put some value in our portfolio. What we have seen is many of those assets are underwater, as you can imagine. Some people are just trying to get out. We think it's gonna be a pretty tremendous opportunity with development being muted. Given the where we are with overall performance in this sector, I think that could keep development also muted for an extended period of time, which I think just creates a really nice, you know, acquisition environment for us.

Great. Thanks. Then just for the follow-up on the Argus or third-party management business, how should we think about entering Canada, kind of the legwork that needs to be done to do that and what that could mean for business and earnings growth?

You know what? There's no question that, you know, part of the Argus strategy was to, you know, expand into Canada in a meaningful way. I just want to reiterate one of the things that, you know, we focused on was, you know, the assimilation of the acquisition. You know, that was incredibly important. As I told my team, "You know, it's not broken, so don't try to fix it. Let's just make it better." From that perspective, one of the things that we talked about in the last call that we've executed on, we had our inaugural owners meeting in San Diego. Not only U.S., but we did bring in a few individuals from Canada that had existing portfolios, developments, et cetera.

We spent a good two days, you know, introducing SmartStop, but more importantly, demonstrating how, you know, we operate in and our entrepreneurial spirit. From that perspective, with, you know, our team up there and how long we've been up there, a lot of the communication that we had with these individuals has transcended into additional conversations. I think overall, from the Argus property management perspective, you know, we're pretty excited about that opportunity, and we think that is one of the really solid growth opportunities, not only this year, for over the next two years. I think one of the things that we did is we, not only U.S. and Canada, we spent a lot of time just listening to people.

That was incredibly important, and figuring out what they liked with the current environment of third-party managers and what they didn't like. What we found is one size doesn't fit all. There are certain people that want you to take care of everything and just send them distributions. There's other individuals that wanna be involved in some decisions, and then there are some individuals that wanna be involved in a lot more decisions. I think that we prepared ourselves in creating a platform that I think resonates with the different owner entrepreneurial operators out there. Finally, I think one of the biggest opportunities that we have, and I think it's primarily U.S. right now, is the existing owners that we have on our platform that have properties with us.

Some of them have numerous properties with other third-party managers. We've already have had some pretty solid discussions in regards to moving the, some of those over to SmartStop or the SmartStop Legacy platform. I think from our perspective, you know, we believe we're gonna see some very interesting growth in 2026 with a platform that's already up and running.

I'd say, just to add to that, and one of the takeaways from that owners conference, which Michael talked about, is, you know, our pipeline is filling up for some bridge lending opportunities as well, right? That's reflected in our guidance, and that's kind of why we broke out the capital deployment strategy the way we did, is we're gonna be very selective and disciplined in our approach. There are a lot of opportunities coming out of our conversations with our third-party clients to put out very attractive capital on a bridge lending basis.

Thanks for that, guys. Appreciate it.

Thank you.

No problem.

Our next question comes from Todd Thomas with KeyBanc Capital Markets. Your line is open. Please go ahead.

Yeah. Hi, thank you. First, just following up on the growth outlook in 2026, I appreciate the comments about, you know, occupancy and, you know, ECRIs and rent trends. How does that sort of impact the cadence of revenue growth throughout the year, sort of, you know, first half or second half, just given some of the market shifts that you've experienced in Asheville and elsewhere, and, you know, just some of the comps that you're up against?

Yeah, Todd, without giving specific cadence, I think a lot of the growth year-over-year is just because of how lumpy the comps are, just gonna sort of depend on the comps. I think the exit rate as you push into 2026 and you look at where we are sitting in the first couple of months of the year, you know, we've got a nice headwind into the year, but then, you know, we've got some tougher comps as you get into the third quarter. It'll be a little bit lumpy like last year, but I think it'll be less lumpy as you go through the course of the year.

Okay. Then, you know, I wanted to ask about your two largest markets right now, Miami and the GTA. They both, you know, continue to perform above the portfolio average. You know, Miami growth slowed, but, you know, still one of the stronger markets. The GTA saw growth, you know, decelerate more sharply over the last few quarters, but it was one of the few markets that saw revenue growth improve, sequentially. Can you just talk about the outlook for, you know, those markets and what you're sort of anticipating in 2026?

Absolutely, Todd. You know, let me start with, you know, kind of our Canadian operating metrics. You know, on a constant currency basis, you know, as we reported, our same-store revenue was up 60 basis points in the fourth quarter. The GTA had decelerated. We had some tougher comps for the first three quarters of 2025, and was the only market in the fourth quarter to re-accelerate. The comps in fourth quarter of 2024 was actually at 5%. It was a much tougher comp than the U.S., which was negative. I'll also note that our move-in rates were actually up in the fourth quarter in Canada, about 1%.

Additionally, if you look at our joint venture SmartCentres properties that would meet our definition of a same store, they actually did even better at around about a 5.3% year-over-year revenue growth on a constant currency basis. You know, as we've kind of just conveyed, we're sitting here today in February with occupancy at 93.3%. That's up 80 basis points year-over-year. The gap is wider than our comps in the state year-over-year. Length of stay remains solid, actually up slightly year-over-year, and ECRIs remain intact. Overall demand remains solid. Our platform continues to capture, you know, outside amounts of demand. Now, that being said, we have seen a more aggressive discounting from competitors.

You know, we feel given our operational advantages, you know, our thesis on Canada remains unchanged. Our outlook on the GTA portfolio is that it will perform slightly better on the U.S. portfolio in 2026, even with tougher comps. Definitely some potential upside for some of the government initiatives going on that could spur some economic growth. We're also concerned that there could be some downsides there, too, if there's any economic pullback in Canada. U.S.?

I'm gonna dive into Miami, and Todd, if you'll allow me, I'm also gonna touch on our third largest market, which is the L.A. MSA as well, briefly. In terms of Miami, obviously, it was one of our top-performing markets in the fourth quarter. You know, we chalk that up to largely just the density of that particular MSA, not to mention our clustering, which also is resulting in enhanced margins and expansion in those markets. In terms of our outlook for that particular market, we do expect it to be at the portfolio average or slightly above average. It's mainly the Miami MSA. I will say that is not the same for other pockets of Florida, right? Where we have seen more supply.

I think when we see Florida supply numbers, a lot of cases it's on the outskirts, but whereas our existing Miami MSA assets are a little more in a little more dense pockets of that particular market. Turning to L.A. as well, the L.A. MSA, you know, this wasn't in our prepared remarks, but overall, we think that that market is strong, despite the fact that there are those two counties with ECRI restrictions. Our guidance does not assume any lifting of those restrictions for the entirety of 2026. To put it in perspective, that's impacting our overall same-store revenue growth guide by about 15 to 20 basis points, so a little less than, you know, some of our peers.

I will note, however, the L.A. MSA, as we define it, also includes other areas that are not in those counties, namely Orange County, and the rest of Southern California has performed quite well, where the very strong occupancies, and it actually still outperformed in the fourth quarter relative to portfolio average. We'd expect those counties to be above average producers in 2026 as well.

Well, we also know that you probably know that L.A. County has extended the price restrictions until March 29th, which is not a surprise to us.

Okay, great. That's all. Really helpful color. Thank you.

Thank you, Todd.

Thanks, Todd.

Our next question comes from Michael Mueller with JPM. Your line is open. Please go ahead.

Hi. I guess first, I think you said, move-in rates were down 11% year-over-year in the fourth quarter, and they're down 1% today. First, is that an apples-to-apples comparison? If so, how much of that improvement's been driven by actually rates that are improving as opposed to easier comps?

Hey, Mike, it's Corak. I'll give you just kind of the overview of where we are year-to-date and maybe add a little bit of color on there 'cause I think you're onto something. When you think about, you know, overall metrics for year-to-date, things have improved since the end of the fourth quarter. For our 2026 same store pool, January ended the month with occupancy at 92.7, up 60 basis points year-over-year and 60 basis points over December, which is a really nice sequential trend. Importantly, rentals were up 12.5%, and move-ins were move-outs have normalized, right, from the end of the quarter.

As of this past weekend in February, Michael mentioned this, we're at occupancy of 92.8%, flat year-over-year, and move-in rates per square foot are down about 1% in February. About half of our markets have turned positive in terms of move-in rents per square foot in January, and about 65% of our markets have turned positive for move-in rents per square foot in February. You can kind of imagine, but the down numbers are kind of skewed by a couple markets, namely Asheville. If you exclude Asheville, all of those metrics improve pretty materially. One of the trends that we've seen this year and we saw in the fourth quarter, is that we are renting larger units than we were in the same period last year.

This is true of the past five months, basically. Specifically in 2026, our average unit size rented is up about 10% year-over-year. The implications there are that while the move-in rents per square foot are down, as we discussed, the actual rents per unit are up. Specifically, and we talked about this, Michael mentioned this, the move-in rents per square foot are down about 8% year-to-date, but the actual rents per unit are up 1% year-over-year. On all fronts, February results improved pretty dramatically over January. You know, we're hesitant to draw conclusions from those, but I think it does speak to sort of the health of the consumer that they're renting some larger units versus 2025.

When you take a look at the aggregate portfolio in January, our in-place rents were up 40 basis points year-over-year, and in February, thus far, and I think that's through the 19th of February, our in-place rents are up 90 basis points year-over-year.

Got it. Okay. Okay. Thank you.

Thank you.

Thanks, Mike.

Our next question comes from Kimon Guelle with Baird. Your line is open. Please go ahead.

Hey, everyone. Thanks for taking my question. Regarding your recently developed Nantucket property, I guess how has the lease-up been trending versus your original expectation, and when do you expect it to fully stabilize?

Yeah. Thanks, Mason. In terms of Nantucket, as you can imagine, it's an island, right? You have a little bit of a captive tenant base there. Also, keep in mind, it was opened in December, right? There's some very, very significant and more material seasonality in that particular market relative to other markets in the States. I would say it's still too early to tell. It's been operating for probably about 50 days at this point. We're, we're monitoring it, and we're gonna continue to use the levers at our disposal to fill it up.

Just to convey that is a joint venture that's not wholly owned by SmartStop. We have a minority interest in that, and we obviously handle the property management activities. We've been on that island for some time, so we kind of understand the dynamics associated with Nantucket, and it tends to generate some really nice rents per square foot.

Great. On your managed rate, AUM growth, do you expect this to be targeted in any specific managed rate, or would it be kind of broad-based across the three that you currently have?

As we've, you know, denoted, we've reached that $1 billion in AUM. The AUM is defined by, you know, the cost basis, not the true value of the portfolio. We have four additional developments in Canada that will, you know, that will come over the next, I think, 12 to 18 months. You know, we see the opportunity to grow AUM in 2026. However, you know, in 2025, we were a little bit obviously occupied with respect to the IPO, and then as we previously said, we transitioned over to a new managing broker-dealer, which did set us back from a timing perspective.

Having said that, we, in 2025, we did have some nice growth with respect to our DST or Delaware Statutory Trust platform. With respect to that, you know, we've launched four of those programs. You know, Blue Door One was a $30 million raise, which is completed. We're in the middle of the raise of Blue Door Two. It's about a $64 million raise, about one-third sold. Blue Door Three, which had some leverage on there for leverage. Those, the Blue Door One and Two are cash, effectively. You know, we just started the fundraising and with that. I think we are teed up for some more, you know, DSTs for the year to keep growing the platform.

I think as we move into 2026, I think we feel like we have a more stable product line between the DSTs, Strategic Storage Trust VI and Strategic Storage Trust X, and now that we are set with our managing broker-dealer partner. We are guiding modest increase in AUM, approximately $60 million. It's driven by the launch of some DSTs, the preferred in Strategic Storage Trust VI, and then kind of the relaunch of Strategic Storage Trust X that we think will get some traction. We're trying to balance out the timing of the potential acquisitions with which obviously can produce rather lumpy fee streams. On the expense side, though, we've had a full year of expense structure with our new partner, which is a more cost-effective structure for us.

We feel pretty good going into 2026 on the managed, REIT platform.

Great. Thanks for the color.

Thank you.

Our next question comes from Spenser Allaway with Green Street. Your line is open. Please go ahead.

Thank you. On the capital allocation front, can you just remind us if you have a share repurchase program in place? If not, has the board contemplated the authorization of one, just given where the stock trades today?

Hey, Spenser. We do not have one in place, nor do we have an ATM into place at this point. You probably saw, we put into place our S-3 shelf registration, which allows us to go out and do a variety of different capital features. We will put an at-the-market ATM program into place here in the not-too-distant future, as we've previously communicated, we don't have a repurchase plan in place at this point.

Yeah, and, you know, I would just further, you know, convey that, you know, the following is that, you know, when we take a look. I guess the question is: How do you grow from here? How are we going to prudently deploy capital? One of the things I'd like to convey is you gotta step back. You know, we started this SmartStop on January 2014. We started with no assets, no liabilities, and no shareholders, but a business plan. We went out and raised every single dollar. We built a very solid management team. Man, you know, from Wayne Johnson, who's been with me for 20 years, to James Barry, 14 years, you know, Joe Robinson, seven, Mike Terjung, 17 years, Bliss, seven years, you know, David Corac, five years. A solid management team.

We've executed on our business plan. We've acquired $500 million of Class A self-storage properties in top 25 markets. That's increased our total capitalization by about 15%. We never had a cost to capital advantage as we've grown this company to a $3 billion or so total cap. Having said that, I think the question's relevant is that we are near our upper levels of leverage, and I think we're comfortable taking our leverage slightly above 6 as long as we can demonstrate a near-term path to organically delever from there.

I think the good thing for us is that we do have a solid amount of organic EBITDA growth, and we think there's a lot of growth potential in the third-party management platform, in addition to some growth on the managed REIT platform, the bridge lending, in addition to the SmartCentres, you know, joint venture. When we think about capital allocation in 2026, you know, we are guiding to an overall capital deployment of about $72 million-$96 million. You know, having said that, to break down our 2026 capital deployment guidance, you know, we'll have three to four properties under construction with the SmartCentres joint venture. Those development yields remain very healthy, high single digits, low to mid-teens on total return perspective and potentially higher.

The capital commitments are relatively low, we feel pretty good about the use of capital there. In addition, you know, we'll continue with our solar programs. We're expecting another batch of probably another 10 properties. Those have pretty attractive yields, about 10% before any tax incentives. We're also seeing a lot of opportunities in our current portfolio to expand, to redevelop. We're expecting to spend about $16 million-$18 million this year. Those returns look pretty healthy and strong. There's a lot of low-hanging fruit from that perspective. Last is a combination of acquisition and loans. With respect to the acquisition environment, both in the U.S. and Canada, but also the lending opportunities that we're seeing through our third-party property management.

One of the big opportunities that I've discussed and we are actively pursuing is this institutional joint venture in the U.S., specifically for acquisitions. You know, we're waiting patiently, you know, for the right partner, but we haven't baked that into any of our guidance. You know, what I'd like to do is just leave you that there are a ton of opportunities on many fronts for SmartStop, and we're gonna be very responsible from a leverage perspective and prudently deploy capital. We're gonna be patient, and we're gonna wait for our cost to capital to come back as the sector recovers. You know, with those, you know, factors in mind, we're not planning on buying back our stock at this point.

Okay, great. Thank you for all that color. I know you provided an operational update for the portfolio overall, earlier in the call, you noted that the Toronto market was where you expected to outperform in the year ahead. I'm just curious if there's any additional color you could provide on the actual year-to-date performance of the Canadian markets?

I don't have that one.

Hey, guys. Spenser, occupancy in the GTA right now has actually outperformed the U.S. year to date, so we're running it at, in the mid 90s, which is up about 80 basis points year-over-year, so it's outperforming the U.S. Meanwhile, the in-place rates are also sort of outperforming. We are seeing year to date, a better performance in Canada versus the U.S. That's the Toronto 13, you know, same-store property specifically. We also have, you know, properties in our non-same-store pool in the portfolio that we bought last year.

Those properties are, you know, in the high 70s, low 80s in terms of overall occupancy and are, you know, ramping up and leasing up in line with our expectations. We're happy on all fronts in our Canadian portfolio at this point. Just to put a bow on that, you know, we talked about the sequential increase in overall same store occupancy from December to January. That was more pronounced in Canada. We actually grew 130 basis points in our same store pool, and we ended January at positive 70 basis points in occupancy year-over-year, as of January 31st.

Excellent. Okay, thank you guys for the color.

Thank you.

Our next question comes from Michael Mueller with JPM. Your line is open. Please go ahead.

Hey, just a quick follow-up. If you do add an acquisition JV, how do you size up what goes into that venture versus the managed platform? And then, you know, if cost of capital improves, do you de-emphasize the JV and just focus more again on balance sheet acquisitions? I mean, how are you thinking about those dynamics?

Well, it's a great question, and as you can imagine, we've been sponsoring multiple programs for the last 20 years, you know, we understand the dynamics associated with that. First and foremost, as we always have stated, SmartStop Self Storage has a right of first refusal, you know, on all assets, whether development or acquisitions. When it comes to the joint venture, I think what we're looking is more I would consider elephant hunting. Much larger aggregate portfolios that we wouldn't be able to take down 100% on our balance sheet or within the managed REIT for the managed REIT platform. I think that would be the big aggregate differentiator.

Let's face it, where we're at right now in our cost to capital, you know what? That opens up the ability to do numerous joint ventures with acquisitions that we see. You know, when that changes, obviously, we're gonna be cognizant of the fact of our joint venture partner, but also, you know, our institutional and retail shareholders, and because we do want to keep growing on balance sheet.

Okay. Thank you.

Thanks, Mike.

There are no further questions at this time. I will now turn the call back to Michael Schwartz for closing remarks.

Well, thank you, operator. It's been an exciting 10 months as a publicly traded company. You know, our team has accomplished a lot short period of time, which has nicely positioned us for the sector recovery. We thank our investors, both retail and institutional, for their support. We look forward to growing together in 2026. In addition, we look forward to seeing many of you at the Citi conference next week. I want to thank you for your time and interest in SmartStop Self Storage, the smarter way to store. Have a great day.

This concludes today's call. Thank you for attending. You may now disconnect.