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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2019
OR
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-37351
National Storage Affiliates Trust
(Exact name of Registrant as specified in its charter)  
Maryland 46-5053858
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)

8400 East Prentice Avenue, 9th Floor
Greenwood Village, Colorado 80111
(Address of principal executive offices) (Zip code)

(720) 630-2600
(Registrant's telephone number including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbols Name of each exchange on which registered
Common Shares of Beneficial Interest, $0.01 par value per share NSA
New York Stock Exchange
Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01 per share NSA Pr A
New York Stock Exchange

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒  No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  ☐   No  ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
☒
Accelerated Filer
☐
Non-accelerated Filer
☐
Smaller Reporting Company
☐
Emerging Growth Company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒
The aggregate market value of the voting and non-voting common shares of beneficial interest of National Storage Affiliates Trust held by non-affiliates of National Storage Affiliates Trust was approximately $1.7 billion as of June 30, 2019. As of February 25, 2020, 59,683,668 common shares of beneficial interest, $0.01 par value per share, were outstanding.
Documents Incorporated by Reference
Portions of the registrant's definitive proxy statement for its annual meeting of shareholders are incorporated by reference into Part III of this Annual Report on Form 10-K.



NATIONAL STORAGE AFFILIATES TRUST
TABLE OF CONTENTS
ANNUAL REPORT ON FORM 10-K
For the Fiscal Year Ended December 31, 2019
Item Page
PART I
1.
Business
5
1A.
Risk Factors
15
1B.
Unresolved Staff Comments
33
2.
Properties
33
3.
Legal Proceedings
34
4.
Mine Safety Disclosures
34
PART II
5.
Market for the Registrant's Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
35
6.
Selected Financial Data
37
7.
Management's Discussion and Analysis of Financial Condition and Results of Operations
38
7A.
Quantitative and Qualitative Disclosures About Market Risk
55
8.
Financial Statements and Supplementary Data
56
9.
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
56
9A.
Controls and Procedures
56
9B.
Other Information
57
PART III
10.
Directors, Executive Officers and Corporate Governance
57
11.
Executive Compensation
57
12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
57
13.
Certain Relationships and Related Transactions, and Director Independence
57
14.
Principal Accounting Fees and Services
57
PART IV
15.
Exhibits and Financial Statement Schedules
57
16.
Form 10-K Summary
61


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FORWARD-LOOKING STATEMENTS
National Storage Affiliates Trust and its consolidated subsidiaries (the "Company", "NSA," "we," "our", and "us") make forward-looking statements in this report that are subject to risks and uncertainties. These forward-looking statements include information about possible or assumed future results of our business, financial condition, liquidity, results of operations, plans and objectives. When we use the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may," or similar expressions, we intend to identify forward-looking statements.
The forward-looking statements contained in this report reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions, and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement.
Statements regarding the following subjects, among others, may be forward-looking:
•market trends in our industry, interest rates, the debt and lending markets or the general economy;
•our business and investment strategy;
•the acquisition of properties, including those under contract, and the ability of our acquisitions to achieve underwritten capitalization rates and our ability to execute on our acquisition pipeline;
•the internalization of existing participating regional operators ("PROs") into the Company;
•the timing of acquisitions;
•our relationships with, and our ability and timing to attract additional, PROs;
•our ability to effectively align the interests of our PROs with us and our shareholders;
•the integration of our PROs and their managed portfolios into the Company, including into our financial and operational reporting infrastructure and internal control framework;
•our operating performance and projected operating results, including our ability to achieve market rents and occupancy levels, reduce operating expenditures and increase the sale of ancillary products and services;
•our ability to access additional off-market acquisitions;
•actions and initiatives of the U.S. federal, state and local government and changes to U.S. federal, state and local government policies and the execution and impact of these actions, initiatives and policies;
•the state of the U.S. economy generally or in specific geographic regions, states, territories or municipalities;
•economic trends and economic recoveries;
•our ability to obtain and maintain financing arrangements on favorable terms;
•general volatility of the securities markets in which we participate;
•changes in the value of our assets;
•projected capital expenditures;
•the impact of technology on our products, operations, and business;
•the implementation of our technology and best practices programs (including our ability to effectively implement our integrated Internet marketing strategy);
•changes in interest rates and the degree to which our hedging strategies may or may not protect us from interest rate volatility;
•impact of and changes in governmental regulations, tax law and rates, accounting guidance and similar matters;
•our ability to continue to qualify and maintain our qualification as a real estate investment trust for U.S. federal income tax purposes ("REIT");

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•availability of qualified personnel;
•the timing of conversions of each series of Class B common units of limited partner interest ("subordinated performance units") in NSA OP, LP (our "operating partnership") and subsidiaries of our operating partnership into Class A common units of limited partner interest ("OP units") in our operating partnership, the conversion ratio in effect at such time and the impact of such convertibility on our diluted earnings (loss) per share;
•the risks of investing through joint ventures, including whether the anticipated benefits from a joint venture are realized or may take longer to realize than expected;
•estimates relating to our ability to make distributions to our shareholders in the future; and
•our understanding of our competition.
The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. Forward-looking statements are not predictions of future events. These beliefs, assumptions, and expectations can change as a result of many possible events or factors, not all of which are known to us. Readers should carefully review our financial statements and the notes thereto, as well as the sections entitled "Business," "Risk Factors," "Properties," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," described in Item 1, Item 1A, Item 2 and Item 7, respectively, of this Annual Report on Form 10-K and the other documents we file from time to time with the Securities and Exchange Commission. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
PART I
Item 1. Business
General
National Storage Affiliates Trust is a fully integrated, self-administered and self-managed real estate investment trust organized in the state of Maryland on May 16, 2013. We have elected and we believe that we have qualified to be taxed as a REIT for U.S. federal income tax purposes commencing with our taxable year ended December 31, 2015. We serve as the sole general partner of our operating partnership subsidiary, NSA OP, LP (our "operating partnership"), a Delaware limited partnership formed on February 13, 2013 to conduct our business, which is focused on the ownership, operation, and acquisition of self storage properties located within the top 100 metropolitan statistical areas ("MSAs") throughout the United States. As of December 31, 2019, we held ownership interests in and operated a geographically diversified portfolio of 742 self storage properties, located in 35 states and Puerto Rico, comprising approximately 47.1 million rentable square feet, configured in approximately 378,000 storage units. According to the 2020 Self-Storage Almanac, we are the sixth largest owner and operator of self storage properties in the United States based on number of properties, self storage units, and rentable square footage. We completed our initial public offering in 2015 and our common shares of beneficial interest, $0.01 par value per share ("common shares") are listed on the New York Stock Exchange under the symbol "NSA."
Our executive chairman of the board of trustees and former chief executive officer, Arlen D. Nordhagen, co-founded SecurCare Self Storage, Inc. in 1988 to invest in and manage self storage properties. While growing SecurCare to over 150 self storage properties, Mr. Nordhagen recognized a market opportunity for a differentiated public self storage REIT that would leverage the benefits of national scale by integrating multiple experienced regional self storage operators with local operational focus and expertise. We believe that his vision, which is the foundation of the Company, aligns the interests of our participating regional operators ("PROs"), with those of our public shareholders by allowing our PROs to participate alongside our shareholders in our financial performance and the performance of our PROs' "managed portfolios", which means, with respect to each PRO, the portfolio of properties that such PRO manages on our behalf. A key component of this strategy is to capitalize on the local market expertise and knowledge of regional self storage operators by maintaining the continuity of their roles as property managers.

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We believe that our structure creates the right financial incentives to accomplish these objectives. We require our PROs to exchange the self storage properties they contribute to the Company for a combination of OP units and subordinated performance units in our operating partnership or subsidiaries of our operating partnership that issue units intended to be economically equivalent to the OP units and subordinated performance units issued by our operating partnership ("DownREIT partnerships"). OP units, which are economically equivalent to our common shares, create alignment with the performance of the Company as a whole. Subordinated performance units, which are linked to the performance of specific managed portfolios, incentivize our PROs to drive operating performance and support the sustainability of the operating cash flow generated by the self storage properties that they manage on our behalf. Because subordinated performance unit holders receive distributions only after portfolio-specific minimum performance thresholds are satisfied, subordinated performance units play a key role in aligning the interests of our PROs with us and our shareholders. Our structure thus offers PROs a unique opportunity to serve as regional property managers for their managed portfolios and directly participate in the potential upside of those properties while simultaneously diversifying their investment to include a broader portfolio of self storage properties. We believe our structure provides us with a competitive growth advantage over self storage companies that do not offer property owners the ability to participate in the performance and potential future growth of their managed portfolios.
We believe that our national platform has significant potential for continued external and internal growth. We seek to further expand our platform by continuing to recruit additional established self storage operators as well as opportunistically partnering with institutional funds and other institutional investors in strategic joint venture arrangements while integrating our operations through the implementation of centralized initiatives, including management information systems, revenue enhancement, and cost optimization programs. We are currently engaged in preliminary discussions with additional self storage operators and believe that we could add one to three more PROs in addition to the PROs we have currently, which will enhance our existing geographic footprint and allow us to enter regional markets in which we currently have limited or no market share. We are also currently under contract to internalize an existing PRO, subject to the satisfaction of customary closing conditions. See "SecurCare Internalization" below.
Our PROs
The Company had ten PROs as of December 31, 2019: SecurCare Self Storage, Inc. and its controlled affiliates ("SecurCare"), Kevin Howard Real Estate Inc., d/b/a Northwest Self Storage and its controlled affiliates ("Northwest"), Optivest Properties LLC and its controlled affiliates ("Optivest"), Guardian Storage Centers LLC and its controlled affiliates ("Guardian"), Move It Self Storage and its controlled affiliates ("Move It"), Arizona Mini Storage Management Company d/b/a Storage Solutions and its controlled affiliates ("Storage Solutions"), Hide-Away Storage Services, Inc. and its controlled affiliates ("Hide-Away"), an affiliate of Shader Brothers Corporation d/b/a Personal Mini Storage ("Personal Mini"), Southern Storage Management Systems, Inc. d/b/a Southern Self Storage ("Southern") and affiliates of Investment Real Estate Management, LLC d/b/a Moove In Self Storage ("Moove In").
To capitalize on their recognized and established local brands, our PROs continue to function as property managers for their managed portfolios under their existing brands (which include various brands in addition to those discussed below). Over the long-run, we may seek to brand or co-brand each location as part of NSA.
•SecurCare, which is headquartered in Lone Tree, Colorado, has been operating since 1988 and is one of our PROs responsible for covering the west, mountain, midwest and southeast regions. SecurCare provided property management services to 215 of our properties located in California, Colorado, Florida, Georgia, Indiana, Kentucky, Louisiana, Mississippi, North Carolina, Ohio, Oklahoma, South Carolina and Texas as of December 31, 2019. SecurCare is currently managed by David Cramer, who has worked in the self storage industry for more than 20 years.
•Northwest, which is headquartered in Portland, Oregon, is our PRO responsible for covering the northwest region. Northwest provided property management services to 78 of our properties located in Idaho, Oregon and Washington as of December 31, 2019. Northwest is led by Kevin Howard, a former member of our board of trustees, who founded Northwest over 30 years ago and is recognized in the industry for his successful track record as a self storage specialist in the areas of design and development, operations and property management, consultation, and brokerage.

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•Optivest, which is based in Dana Point, California, is one of our PROs responsible for covering portions of the northeast and southwest regions. Optivest managed 64 of our properties located in Arizona, California, Massachusetts, Nevada, New Hampshire, New Mexico and Texas as of December 31, 2019. Optivest is run by its co-founder, Warren Allan, who has more than 25 years of financial and operational management experience in the self storage industry and is recognized as a self storage acquisition and development specialist.
•Guardian, which is based in Irvine, California, is one of our PROs responsible for covering portions of the southern California and southwest regions. Guardian managed 55 of our properties located in California, Arizona and Nevada as of December 31, 2019. Guardian is led by John Minar, who has nearly 40 years of self storage acquisition, rehabilitation, ownership, operations and development experience.
•Move It, which is based in Dallas, Texas, is one of our PROs responsible for covering portions of the Texas and southeast markets. Move It managed 33 of our properties located in Alabama, Florida, Louisiana, Mississippi and Texas as of December 31, 2019. Move It is led by its founder, Tracy Taylor, who has more than 40 years of experience in self storage development, acquisition and management, and is currently on the board of directors for the Large Owners Council of the Self Storage Association and is a former Chairman of the Self Storage Association.
•Storage Solutions, which is based in Chandler, Arizona, is our PRO responsible for covering portions of the Arizona and Nevada markets. Storage Solutions managed 10 of our properties in Arizona and Nevada as of December 31, 2019. Storage Solutions is led by its founder, Bill Bohannan, who is one of the largest operators in Phoenix and has more than 35 years of self storage acquisition, development and management experience. Mr. Bohannan is recognized in the industry as a self storage acquisition, development and management specialist.
•Hide-Away, which is based in Sarasota, Florida, is our PRO responsible for covering the western Florida market. Hide-Away managed 22 of our properties in western Florida as of December 31, 2019. Hide-Away is led by its founder, Steve Wilson, one of the early developers of the self storage business, who served for more than 35 years as the President of Hide-Away and its related entities, and is a former Chairman of the Self Storage Association.
•Personal Mini, which is based in Orlando, Florida, is our PRO responsible for covering portions of the central Florida market. Personal Mini managed eight of our properties in central Florida as of December 31, 2019. Personal Mini is led by Marc Smith, a self storage investor who has been involved in all facets of the self storage business. Mr. Smith is a past Chairman of the Self Storage Association, and also previously served as president of the Southeast Region of the Self Storage Association.
•Southern, which is based in Palm Beach Gardens, Florida, is one of our PROs responsible for covering portions of Arizona and the southeast region, including New Orleans, the Florida Panhandle, southern Georgia, and Puerto Rico. Southern managed 29 of our properties in Arizona, Louisiana, the Florida Panhandle, southern Georgia, and Puerto Rico as of December 31, 2019. Southern is led by Bob McIntosh and Peter Cowie, who are active real estate operators with more than 30 years of self storage experience.
•Moove In, which is based in York, Pennsylvania, is our PRO responsible for covering portions of the northeast region, including portions of Pennsylvania, Massachusetts, and New Jersey. Moove In managed 11 of our properties in Pennsylvania, Massachusetts, and New Jersey as of December 31, 2019. Moove In is led by John Gilliland, a past Chairman of the Self Storage Association.
We benefit from the local market knowledge and active presence of our PROs, allowing us to build and foster important customer and industry relationships. These local relationships provide attractive off-market acquisition opportunities that we believe will continue to fuel additional external growth.
We believe our structure allows our PROs to optimize their established property management platforms while addressing financial and operational hurdles. Before joining us, our PROs faced challenges in securing low cost capital and had to manage multiple investors and lending relationships, making it difficult to compete with larger competitors, including public REITs, for acquisition and investment opportunities. Our PROs were also limited in their ability to raise growth capital through the sale of assets, a portfolio refinancing, or capital contributions from new equity partners. Serving as our on-the-ground acquisition teams, our PROs now have access to our broader

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financing sources and lower cost of capital, while our national platform allows them to benefit from economies of scale to drive operating efficiencies in a rapidly evolving, technology-driven industry.
SecurCare Internalization
On February 24, 2020, we entered into a definitive agreement with SecurCare to merge SecurCare into a wholly owned subsidiary of the Company. As a result of the merger, SecurCare's property management platform and related intellectual property will be internalized by us. As part of the internalization, most of SecurCare's employees, including its president and chief executive officer, David Cramer, and its other key persons, will be offered employment by us and will continue managing SecurCare's portfolio of properties under the brand SecurCare as members of our existing property management platform. Mr. Cramer will replace Steven B. Treadwell as our chief operating officer and executive vice president effective at or around the closing of the merger. As a result of the merger, we will no longer pay any fees or reimbursements to SecurCare and distributions on the series of subordinated performance units related to SecurCare's managed portfolio will be discontinued. The transactions are expected to close during the second quarter of 2020, subject to customary closing conditions. However, there is no assurance that the transactions will be consummated at all or at the time or pursuant to the terms currently contemplated. For additional information, see the current report on Form 8-K that we filed with the Securities and Exchange Commission on February 24, 2020.
Our Consolidated Properties
We seek to own properties that are well located in high quality sub-markets with highly accessible street access and attractive supply and demand characteristics, providing our properties with strong and stable cash flows that are less sensitive to the fluctuations of the general economy. Many of these markets have multiple barriers to entry against increased supply, including zoning restrictions against new construction and new construction costs that we believe are higher than our properties' fair market value. As of December 31, 2019, we owned a geographically diversified portfolio of 567 self storage properties, located in 29 states and Puerto Rico, comprising approximately 34.5 million rentable square feet, configured in approximately 275,000 storage units. Of these properties, 265 were acquired by us from our PROs, 301 were acquired by us from third-party sellers and one was acquired by us from the 2016 Joint Venture (as defined in Note 5 to the consolidated financial statements in Item 8). A complete listing of, and additional information about, our self storage properties is included in Item 2 of this report. 
During the year ended December 31, 2019, we acquired 69 consolidated self storage properties, of which 19 were acquired by us from our PROs, 49 were acquired by us from third-party sellers and one was acquired by us from the 2016 Joint Venture. The following is a summary of our 2019 consolidated acquisition activity (dollars in thousands):
Number of Number of Rentable
State Properties Units Square Feet Fair Value
2019 Acquisitions:
Florida 12    5,400    653,564    $ 90,580   
Louisiana 12    6,052    682,729    69,330   
Texas 11    5,292    801,344    79,688   
Georgia 10    5,113    658,636    70,134   
Pennsylvania 6    2,665    299,125    33,162   
Idaho 3    925    202,545    12,450   
New Jersey 3    1,436    191,304    18,182   
New Mexico 3    1,950    233,868    28,221   
Arizona 2    801    97,320    11,475   
Massachusetts 2    1,454    124,200    12,312   
Missouri 2    861    103,726    9,066   
Other(1)
3    1,011    128,937    13,230   
Total 69    32,960    4,177,298    $ 447,830   

(1) Self storage properties in other states acquired during the year ended December 31, 2019 include Maryland, New Hampshire and Oregon.

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During the year ended December 31, 2019, we sold one self storage property to an unrelated third party for $6.5 million. The self storage property comprised less than 0.1 million rentable square feet configured in approximately 500 storage units.
During the year ended December 31, 2018, we acquired 57 consolidated self storage properties and an expansion project adjacent to an existing property, of which four were acquired by us from our PROs and 53 were acquired by us from third-party sellers. The following is a summary of our 2018 consolidated acquisition activity (dollars in thousands):
Number of Number of Rentable
State/Territory Properties Units Square Feet Fair Value
2018 Acquisitions:
Arizona 13    6,943    758,623    $ 74,168   
Kansas 13    4,443    548,415    59,876   
Florida 5    2,893    322,111    32,483   
Missouri 4    2,000    235,300    28,175   
North Carolina 4    2,296    285,975    39,596   
California 2    895    102,207    15,741   
Nevada 2    837    108,065    11,172   
Oregon 2    486    63,805    8,137   
Texas 2    956    125,087    9,549   
Other(1)
10    6,411    662,175    77,752   
Total 57    28,160    3,211,763    356,649   

(1) Self storage properties in other states and territories acquired during the year ended December 31, 2018 include Georgia, Maryland, Ohio, Washington, and Puerto Rico.
During the year ended December 31, 2018, we sold two self storage properties to unrelated third parties for $5.5 million. The self storage properties comprised approximately 0.1 million rentable square feet configured in approximately 1,500 storage units.
Our Unconsolidated Real Estate Ventures
We seek to opportunistically partner with institutional funds and other institutional investors to acquire attractive portfolios utilizing a promoted return structure. We believe there is significant opportunity for continued external growth by partnering with institutional investors seeking to deploy capital in the self storage industry.
2018 Joint Venture
As of December 31, 2019, our 2018 Joint Venture (as defined in Note 5 to the consolidated financial statements in Item 8), in which we have a 25% ownership interest, owned and operated 103 self storage properties containing approximately 7.7 million rentable square feet, configured in over 63,000 storage units and located across 17 states.
2016 Joint Venture
As of December 31, 2019, our 2016 Joint Venture, in which we have a 25% ownership interest, owned and operated a portfolio of 72 properties containing approximately 4.9 million rentable square feet, configured in approximately 40,000 storage units and located across 13 states. During the year ended December 31, 2019, our 2016 Joint Venture sold to the Company one self storage property for $4.1 million, comprising less than 0.1 million rentable square feet, configured in approximately 300 storage units.
Our Property Management Platform
Through our property management platform, branded iStorage, we direct, manage and control the day-to-day operations and affairs of certain consolidated properties and our unconsolidated real estate ventures. We earn certain customary fees for managing and operating the properties in the unconsolidated real estate ventures and we facilitate tenant insurance and/or tenant warranty protection programs for tenants at these properties in exchange for half of all proceeds from such programs. Over time, as PROs retire, we may we transfer management of all or part of an existing PRO's managed portfolio to our or another PRO's property management platform.

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As of December 31, 2019, our property management platform managed and controlled 42 of our consolidated properties in select markets in California, Illinois, Kansas, Maryland, Missouri, Ohio, Texas and Virginia.
Our Competitive Strengths
We believe our unique PRO structure combined with our property management platform allows us to differentiate ourselves from other self storage operators, and the following competitive strengths enable us to effectively compete against our industry peers:
High Quality Properties in Key Growth Markets.    We held ownership interests in and operated a geographically diversified portfolio of 742 self storage properties, located in 35 states and Puerto Rico, comprising approximately 47.1 million rentable square feet, configured in approximately 378,000 storage units as of December 31, 2019. Over 75% of our consolidated portfolio is located in the top 100 MSAs, based on our 2019 net operating income ("NOI"). We believe that these properties are primarily located in high quality growth markets that have attractive supply and demand characteristics and are less sensitive to the fluctuations of the general economy. Many of these markets have multiple barriers to entry against increased supply, including zoning restrictions against new construction and new construction costs that we believe are higher than our properties' fair market value. Furthermore, we believe that our significant size and the overall geographic diversification of our portfolio reduces risks associated with specific local or regional economic downturns or natural disasters.
Differentiated, Growth-Oriented Strategy Focused on Established Operators.    We are a self storage REIT with a unique structure that supports our differentiated external growth strategy. Our PRO structure appeals to operators who are looking for access to growth capital while maintaining an economic stake in the self storage properties that each manages on the Company's behalf. These attributes entice operators to join the Company rather than sell their properties for cash consideration. Through our PRO structure, we seek to attract operators who are confident in the future performance of their properties and desire to participate in the growth of the Company. We have successfully recruited established operators across the United States with a history of efficient property management and a track record of successful acquisitions. Our structure and differentiated strategy have enabled us to build a substantial captive pipeline from existing operators as well as potentially create external growth from the recruitment of additional PROs.
Integrated Platform Utilizing Advanced Technology for Enhanced Operational Performance and Best Practices.    Our national platform allows us to capture cost savings through integration and centralization, thereby eliminating redundancies and utilizing economies of scale across the property management platforms of us and our PROs. As compared to a stand-alone operator, our national platform has greater access to lower-cost capital, reduced Internet marketing costs per customer lead, discounted property insurance expense, and reduced overhead costs. In addition, the Company has sufficient scale for various centralized functions, including financial reporting, the operation of call centers, expanding cell tower leasing, a national credit card processing program, marketing, information technology, legal support, and capital market functions, to achieve substantial cost savings over smaller, individual operators.
Our national platform utilizes advanced technology for our data warehouse program, Internet marketing, our centralized call centers, financial and property analytic dashboards, revenue optimization analytics and expense management tools to enhance operational performance. These centralized programs, which are run through our Technology and Best Practices Group, are positively impacting our business performance, and we believe that they will continue to be a driver of organic growth going forward. We will continue to utilize our Technology and Best Practices Group to help us benefit from the collective sharing of key operating strategies among our PROs in areas like human resource management, local marketing and operating procedures and building tenant insurance-related arrangements.
Aligned Incentive Structure with Shareholder Downside Protection.    Our structure promotes operator accountability as subordinated performance units issued to our PROs in exchange for the contribution of their properties are entitled to distributions only after those properties satisfy minimum performance thresholds. In the event of a material reduction in operating cash flow, distributions on our subordinated performance units will be reduced before or disproportionately to distributions on our common shares held by our common shareholders. In addition, we expect our PROs will generally co-invest subordinated equity in the form of subordinated performance units in each acquisition that they source from a third-party seller, and the value of these subordinated performance units will fluctuate with the performance of their managed portfolios. Therefore, our PROs are incentivized to select acquisitions that are expected to exceed minimum performance thresholds, thereby increasing the value of their

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subordinated equity stake. We expect that our shareholders will benefit from the higher levels of property performance that our PROs are incentivized to deliver.
Our Business and Growth Strategies
By capitalizing on our competitive strengths, we seek to increase scale, achieve optimal revenue-producing occupancy and rent levels, and increase long-term shareholder value by achieving sustainable long-term growth. Our business and growth strategies to achieve these objectives are as follows:
Maximize Property Level Cash Flow.    We strive to maximize the cash flows at our properties by leveraging the economies of scale provided by our national platform, including through the implementation of new ideas derived from our Technology and Best Practices Group. We believe that our unique PRO structure, centralized infrastructure and efficient national platform will enable us to achieve optimal market rents and occupancy, reduce operating expenses and increase the sale by our PROs of ancillary products and services, including tenant insurance, of which we receive a portion of the proceeds, truck rentals and packing supplies.
Acquire Built-in Captive Pipeline of Target Properties from Existing PROs.    We have an attractive, high quality potential acquisition pipeline (our "captive pipeline") of approximately 140 self storage properties valued at approximately $1.4 billion that will continue to drive our future growth. We consider a property to be in our captive pipeline if it (i) is under a management service agreement with one of our PROs, (ii) meets our property quality criteria, and (iii) is either required to be offered to us under the applicable facilities portfolio management agreement or a PRO has a reasonable basis to believe that the controlling owner of the property intends to sell the property in the next seven years.
Our PROs have management service agreements with all of the properties in our captive pipeline and hold controlling and non-controlling ownership interests in some of these properties. With respect to each property in our captive pipeline in which a PRO holds a controlling ownership interest, such PRO has agreed that it will not transfer (or permit the transfer of, to the extent possible) any interest in such self storage property without first offering or causing to be offered (if permissible) such interest to us. In addition, upon maturity of the outstanding mortgage indebtedness encumbering such property, so long as occupancy is consistent with or exceeds average local market levels, which we determine in our sole discretion, such PRO has agreed to offer or cause to be offered (if permissible) such interest to us. With respect to captive pipeline properties in which our PROs have a non-controlling ownership interest or no ownership interest, each PRO has agreed to use commercially reasonable good faith efforts to facilitate our purchase of such property. We preserve the discretion to accept or reject any of the properties that our PROs are required to, or elect to, offer (or cause to be offered) to us.
Access Additional Off-Market Acquisition Opportunities.    Our PROs and their "on-the-ground" personnel have established an extensive network of industry relationships and contacts in their respective markets. Through these local connections, our PROs are able to access acquisition opportunities that are not publicly marketed or sold through auctions. Our structure incentivizes our PROs to source acquisitions in their markets from third-party sellers and consolidate these properties into the Company. Other public self storage companies generally have acquisition teams located at their central offices, which in many instances are far removed from regional and local markets. We believe our operators' networks and close familiarity with the other operators in their markets provide us clear competitive advantages in identifying and selecting attractive acquisition opportunities. Our PROs have sourced 265 acquisitions from third-party sellers comprising approximately 18.0 million rentable square feet as of December 31, 2019.
Recruit Additional New PROs in Target Markets.    We intend to continue to execute on our external growth strategy through additional acquisitions and contributions from future PROs in key markets. We believe there is significant opportunity for growth through consolidation of the highly fragmented composition of the market. We believe that future operators will be attracted to our unique structure, providing them with lower cost of capital, better economies of scale, and greater operational and overhead efficiencies while preserving their existing property management platforms. We intend to add one to three additional PROs to complement our existing geographic footprint and to achieve our goal of creating a highly diversified nationwide portfolio of properties focused in the top 100 MSAs. When considering a PRO candidate, we consider various factors, including the size of the potential PRO's portfolio, the quality and location of its properties, its market exposure, its operating expertise, its ability to grow its business, and its reputation with industry participants.
Strategic Joint Venture Arrangements.    We intend to continue to opportunistically partner with institutional funds and other institutional investors to acquire attractive portfolios utilizing a promoted return structure. We

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believe there is significant opportunity for continued external growth by partnering with institutional investors seeking to deploy capital in the self storage industry. We intend to leverage our property management platform to provide property and asset management services for future strategic joint ventures, generating additional operating profits and third party fee income.
Our Financing Strategy
We expect to maintain a flexible approach in financing new property acquisitions. In general, we expect to fund our property acquisitions through a combination of borrowings under bank credit facilities (including term loans and revolving facilities), property-level debt, issuances of OP equity and public and private equity and debt issuances.
As of December 31, 2019, our unsecured credit facility provided for total borrowings of $1.275 billion (the "credit facility"). The credit facility consists of the following components: (i) a revolving line of credit (the "Revolver") which provides for a total borrowing commitment up to $500.0 million, under which we may borrow, repay and re-borrow amounts, (ii) a $125.0 million tranche A term loan facility (the "Term Loan A"), (iii) a $250.0 million tranche B term loan facility (the "Term Loan B"), (iv) a $225.0 million tranche C term loan facility (the "Term Loan C"), and (v) a $175.0 million tranche D term loan facility (the "Term Loan D"). As of December 31, 2019, we had the entire amounts drawn on Term Loan A, Term Loan B, Term Loan C and Term Loan D and we had no outstanding borrowings under the Revolver, and the capacity to borrow an additional $494.3 million under the Revolver while remaining in compliance with the credit facility's financial covenants. As of December 31, 2019, we have an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.750 billion.
We have a credit agreement with a syndicated group of lenders for a term loan facility that matures in June 2023 (the "2023 Term Loan Facility") and is separate from the credit facility in an aggregate amount of $175.0 million. As of December 31, 2019 the entire amount was outstanding under the 2023 Term Loan Facility with an effective interest rate of 2.83%. We have an expansion option under the 2023 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount of $400.0 million.
We have a credit agreement with a lender for a term loan facility that matures in December 2028 (the "2028 Term Loan Facility") and is separate from the credit facility and 2023 Term Loan Facility in an aggregate amount of $75.0 million. As of December 31, 2019 the entire amount was outstanding under the 2028 Term Loan Facility with an effective interest rate of 4.62%. We have an expansion option under the 2028 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount up to $125.0 million.
On April 24, 2019, we entered into a credit agreement with a lender for a term loan facility that matures in April 2029 (the "2029 Term Loan Facility") and is separate from the credit facility, 2023 Term Loan Facility and 2028 Term Loan Facility in an aggregate amount of $100.0 million. As of December 31, 2019 the entire amount was outstanding under the 2029 Term Loan Facility with an effective interest rate of 4.27%.
The credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility each contain the same financial covenants and customary affirmative and negative covenants that, among other things, could limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
On August 30, 2019, our operating partnership issued $100.0 million of 3.98% senior unsecured notes due August 30, 2029 (the "2029 Senior Unsecured Notes") and $50.0 million of 4.08% senior unsecured notes due August 30, 2031 (the "2031 Senior Unsecured Notes" and together with the 2029 Senior Unsecured Notes, the "Senior Unsecured Notes") in a private placement to certain institutional accredited investors. The Senior Unsecured Notes are subject to customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
We expect to employ leverage in our capital structure in amounts determined from time to time by our board of trustees. Although our board of trustees has not adopted a policy which limits the total amount of indebtedness that we may incur, it will consider a number of factors in evaluating our level of indebtedness from time to time, as well as the amount of such indebtedness that will be either fixed and variable-rate, and in making financial decisions, including, among others, the following:
•the interest rate of the proposed financing;
•the extent to which the financing impacts our flexibility in managing our properties;

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•prepayment penalties and restrictions on refinancing;
•the purchase price of properties we acquire with debt financing;
•our long-term objectives with respect to the financing;
•our target investment returns;
•the ability of particular properties, and the Company as a whole, to generate cash flow sufficient to cover expected debt service payments;
•overall level of consolidated indebtedness;
•timing of debt maturities;
•provisions that require recourse and cross-collateralization;
•corporate credit ratios including debt service coverage, debt to total market capitalization and debt to undepreciated assets; and
•the overall ratio of fixed- and variable-rate debt.
Our indebtedness may be recourse, non-recourse or cross-collateralized. If the indebtedness is non-recourse, the collateral will be limited to the particular properties to which the indebtedness relates. In addition, we may invest in properties subject to existing loans secured by mortgages or similar liens on our properties, or may refinance properties acquired on a leveraged basis. We may use the proceeds from any borrowings to refinance existing indebtedness, to refinance investments, including the redevelopment of existing properties, for general working capital or for other purposes when we believe it is advisable.
Dividend Reinvestment Plan
In the future, we may adopt a dividend reinvestment plan that will permit shareholders who elect to participate in the plan to have their cash dividends reinvested in additional common shares.
Regulation
General
Generally, self storage properties are subject to various laws, ordinances and regulations, including those relating to lien sale rights and procedures, public accommodations, insurance, and the environment. Changes in any of these laws, ordinances or regulations could increase the potential liability existing or created by tenants or others on our properties. Laws, ordinances, or regulations affecting development, construction, operation, upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of self storage sites or other impairments to operations, which would adversely affect our cash flows from operating activities.
Under the Americans with Disabilities Act of 1990 (the "ADA"), all places of public accommodation are required to meet certain federal requirements related to access and use by disabled persons. For additional information on the ADA, see "Item 1A. Risk Factors—Risks Related to Our Business—Costs associated with complying with the ADA may result in unanticipated expenses."
Insurance activities are subject to state insurance laws and regulations as determined by the particular insurance commissioner for each state in accordance with the McCarran-Ferguson Act, as well as subject to the Gramm-Leach-Bliley Act and the privacy regulations promulgated by the Federal Trade Commission pursuant thereto.
Under the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended ("CERCLA"), and comparable state laws, we may be required to investigate and remediate regulated hazardous materials at one or more of our properties. For additional information on environmental matters and regulation, see "Item 1A. Risk Factors—Risks Related to Our Business—Environmental compliance costs and liabilities associated with operating our properties may affect our results of operations."
Property management activities are often subject to state real estate brokerage laws and regulations as determined by the particular real estate commission for each state.

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REIT Qualification
We have elected and we believe that we have qualified to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, (the "Code"), commencing with our taxable year ended on December 31, 2015. We generally will not be subject to U.S. federal income tax on our net taxable income to the extent that we distribute annually all of our net taxable income to our shareholders and maintain our qualification as a REIT. We believe that we have been organized and have operated in conformity with the requirements for qualification and taxation as a REIT under the Code, and we expect that our intended manner of operation will enable us to continue to meet the requirements for qualification and taxation as a REIT. To qualify, and maintain our qualification, as a REIT, we must meet on a continuing basis, through our organization and actual investment and operating results, various requirements under the Code relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the diversity of ownership of our shares. If we fail to qualify as a REIT in any taxable year and do not qualify for certain statutory relief provisions, we will be subject to U.S. federal income tax at regular corporate rates and may be precluded from qualifying as a REIT for the subsequent four taxable years following the year during which we failed to qualify as a REIT. Even if we qualify for taxation as a REIT, we still may be subject to some U.S. federal, state and local taxes on our income or assets. In addition, subject to maintaining our qualification as a REIT, a portion of our business is conducted through, and a portion of our income is earned by, one or more taxable REIT subsidiaries ("TRSs"), which are subject to U.S. federal corporate income tax at regular rates. Distributions paid by us generally will not be eligible for taxation at the preferential U.S. federal income tax rates that currently apply to certain distributions received by individuals from taxable corporations, unless such distributions are attributable to dividends received by us from a TRS.
U.S. Federal Income Tax Legislation
On December 22, 2017, Congress enacted H.R. 1, also known as the Tax Cuts and Jobs Act of 2017 ("TCJA"). The TCJA made major changes to the Internal Revenue Code, including the reduction of the tax rates applicable to individuals and subchapter C corporations, a reduction or elimination of certain deductions (including new limitations on the deductibility of interest expense), permitting immediate expensing of capital expenditures and significant changes in the taxation of earnings from non-U.S. sources. The effect of the significant changes made by the TCJA remains uncertain, and additional administrative guidance is still required in order to fully evaluate the effect of many provisions. In addition, final regulations implementing certain of these new rules have not yet been issued and additional changes or corrections may still be forthcoming. While we do not currently expect this reform to have a significant impact to the Company's consolidated financial statements, stockholders are urged to consult with their tax advisors regarding the effects of the TCJA or other legislative, regulatory or administrative developments on an investment in the Company's common stock.
Competition
We compete with many other entities engaged in real estate investment activities for customers and acquisitions of self storage properties and other assets, including national, regional, and local owners, operators, and developers of self storage properties. We compete based on a number of factors including location, rental rates, security, suitability of the property's design to prospective tenants' needs, and the manner in which the property is operated and marketed. We believe that the primary competition for potential customers comes from other self storage properties within a three to five mile radius. We have positioned our properties within their respective markets as high-quality operations that emphasize tenant convenience, security, and professionalism.
We also may compete with numerous other potential buyers when pursuing a possible property for acquisition, which can increase the potential cost of a project. These competing bidders also may possess greater resources than us and therefore be in a better position to acquire a property. However, our use of OP units and subordinated performance units as transactional currency allows us to structure our acquisitions in tax-deferred transactions. As a result, potential targets who are tax-sensitive might favor us as a suitor.
Our primary national competitors in many of our markets for both tenants and acquisition opportunities include local and regional operators, institutional investors, private equity funds, as well as the other public self storage REITs, including Public Storage, CubeSmart, Extra Space Storage Inc. and Life Storage, Inc.  These entities also seek financing through similar channels to the Company. Therefore, we will continue to compete for institutional investors in a market where funds for real estate investment may decrease.

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Employees
As of December 31, 2019, the Company had 459 employees, which includes employees of our property management platform but does not include persons employed by our PROs. As of December 31, 2019, our PROs, collectively, had approximately 1,100 full-time and part-time employees involved in management, operations, and reporting with respect to our self storage property portfolio.
Available Information
We file registration statements, proxy statements, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those statements and reports with the Securities and Exchange Commission (the "SEC"). Investors may obtain copies of these statements and reports by accessing the SEC's website at www.sec.gov. Our statements and reports and any amendments to any of those statements and reports that we file with the Securities and Exchange Commission are available free of charge as soon as reasonably practicable on our website at www.nationalstorageaffiliates.com. The information contained on our website is not incorporated into this Annual Report on Form 10-K. Our common shares are listed on the New York Stock Exchange under the symbol "NSA."
Item 1A. Risk Factors
 An investment in our common shares involves a high degree of risk. Before making an investment decision, you should carefully consider the following risk factors, together with the other information contained in this Annual Report on Form 10-K. If any of the risks discussed in this Annual Report on Form 10-K occurs, our business, financial condition, liquidity and results of operations could be materially and adversely affected.
Risks Related to Our Business
Adverse economic or other conditions in the markets in which we do business and more broadly associated with the real estate industry could negatively affect our occupancy levels and rental rates and therefore our operating results and the value of our self storage properties.
Our operating results are dependent upon our ability to achieve optimal occupancy levels and rental rates at our self storage properties. Adverse economic or other conditions in the markets in which we do business, particularly in our markets in California, Oregon, Florida, Texas, Georgia, Arizona and North Carolina, which accounted for approximately 22%, 11%, 10%, 10%, 6%, 6% and 5%, respectively, of our total rental and other property-related revenues for the year ended December 31, 2019, may lower our occupancy levels and limit our ability to maintain or increase rents or require us to offer rental discounts. No single customer represented a significant concentration of our 2019 revenues. The following adverse developments, among others, in the markets in which we do business may adversely affect the operating performance of our properties:
•business layoffs or downsizing, industry slowdowns, relocation of businesses and changing demographics; 
•periods of economic slowdown or recession, declining demand for self storage or the public perception that any of these events may occur; 
•local or regional real estate market conditions, such as competing properties or products, the oversupply of self storage, vacancies or changes in self storage space market rents, or a reduction in demand for self storage in a particular area; and 
•perceptions by prospective tenants of the safety, convenience and attractiveness of our properties and the neighborhoods in which they are located.
We are also susceptible to the effects of adverse macro-economic events and business conditions that can result in higher unemployment, shrinking demand for products, large-scale business failures and tight credit markets. Our results of operations are sensitive to changes in overall economic conditions that impact consumer spending, including discretionary spending, as well as to increased bad debts due to recessionary pressures. Adverse economic conditions affecting disposable consumer income, such as employment levels, business conditions, interest rates and the availability of financing, tax rates, fuel and energy costs, could reduce consumer spending or cause consumers to shift their spending to other products and services. A general reduction in the level of discretionary spending or shifts in consumer discretionary spending could adversely affect our growth and profitability. Our operating results and cash available for distribution could also be adversely impacted if we experience increased operating costs, including maintenance, insurance premiums and real estate taxes, whether due to economic conditions, government

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regulation or otherwise. In addition, our operating expenses, including taxes, insurance, maintenance and debt service payments, may not be reduced even if we experience a reduction in revenues, which may exacerbate the impact on our profitability.
We may not be successful in identifying and consummating suitable acquisitions, adding additional suitable new PROs, or integrating and operating such acquisitions, including integrating them into our financial and operational reporting infrastructure and internal control framework in a timely manner, which may impede our growth.
Our ability to expand through acquisitions is integral to our business strategy and requires us to identify suitable acquisition candidates or investment opportunities that meet our criteria and are compatible with our growth strategy. We may not be successful in identifying suitable properties or other assets that meet our acquisition criteria or in consummating acquisitions on satisfactory terms or at all. Failure to identify or consummate acquisitions will slow our growth, which could in turn adversely affect our share price.
For the potential acquisitions in our captive pipeline, we have not entered into negotiations with the respective owners of these properties and there can be no assurance as to whether we will acquire any of these properties or the actual timing of any such acquisitions. Each captive pipeline property is subject to additional due diligence and the determination by us to pursue the acquisition of the property. In addition, with respect to the captive pipeline properties in which our PROs have a non-controlling ownership interest or no ownership interest, the current owner of each property is not required to offer such property to us and there can be no assurance that we will acquire these properties.
Our ability to acquire properties on favorable terms and successfully integrate and operate them, including integrating them into our financial and operational reporting infrastructure in a timely manner, may be constrained by the following significant risks:
•we face competition from national (e.g., large public and private self storage companies, institutional investors and private equity funds), regional and local owners, operators and developers of self storage properties, which may result in higher property acquisition prices and reduced yields; 
•we may not be able to achieve satisfactory completion of due diligence investigations and other customary closing conditions; 
•we may fail to finance an acquisition on favorable terms or at all; 
•we may spend more time and incur more costs than budgeted to make necessary improvements or renovations to acquired properties; 
•we may experience difficulties in effectively integrating the financial and operational reporting systems of the properties or portfolios we acquire into (or supplanting such systems with) our financial and operational reporting infrastructure and internal control framework in a timely manner; and 
•we may acquire properties subject to liabilities without any recourse, or with only limited recourse, with respect to unknown liabilities such as liabilities for clean-up of undisclosed environmental contamination, tax liabilities, claims by persons dealing with the former owners of the properties and claims for indemnification by general partners, trustees, officers and others indemnified by the former owners of the properties. The sellers or contributors of properties may make limited representations and warranties to us about the properties and may agree to indemnify us for a certain period of time following the closing for breaches of those representations and warranties. However, any resulting liabilities identified may not fall within the scope or time frame covered by the indemnification, and we may be required to bear those liabilities, which may materially and adversely affect our operating results, financial condition and business.
We face competition for tenants.
We compete with many other entities engaged in real estate investment activities for tenants, including national, regional and local owners, operators and developers of self storage properties. Our primary national competitors for tenants in many of our markets are the large public and private self storage companies, institutional investors, and private equity funds. Actions by our competitors may decrease or prevent increases in the occupancy and rental rates, while increasing the operating expenses of our properties.

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Rental revenues are significantly influenced by demand for self storage space generally, and a decrease in such demand would likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio.
Because our portfolio of properties consists primarily of self storage properties, we are subject to risks inherent in investments in a single industry. A decrease in the demand for self storage space would have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio. Demand for self storage space has been and could be adversely affected by weakness in the national, regional and local economies, changes in supply of, or demand for, similar or competing self storage properties in an area and the excess amount of self storage space in a particular market. To the extent that any of these conditions occur, they are likely to affect market rents for self storage space, which could cause a decrease in our rental revenue. Any such decrease could impair our operating results, ability to satisfy debt service obligations and ability to make cash distributions to our shareholders.
Increases in taxes and regulatory compliance costs may reduce our income and adversely impact our cash flows.
Increases in income or other taxes generally are not passed through to tenants under leases and may reduce our net income, funds from operations ("FFO"), cash flows, financial condition, ability to pay or refinance our debt obligations, ability to make cash distributions to shareholders, and the trading price of our securities. Similarly, changes in laws increasing the potential liability for environmental conditions existing on properties or increasing the restrictions on discharges or other conditions may result in significant unanticipated expenditures, which could result in similar adverse effects.
Many states and jurisdictions are facing severe budgetary problems. Action that may be taken in response to these problems, such as changes to sales taxes or other governmental efforts, including mandating medical insurance for employees, could adversely impact our business and results of operations.
Our property taxes could increase due to various reasons, including changes in law and a reassessment as a result of our contribution transactions, which could adversely impact our operating results and cash flow.
The value of our properties may be reassessed for property tax purposes by taxing authorities including as a result of our acquisition and contribution transactions. Our property taxes could also increase due to changes in tax rates or removal of limitations on the amount by which our property taxes or property reassessments may increase. For example, there is a vote to remove certain Proposition 13 protections in the State of California for owners of commercial real estate, including self storage properties, which will be included on California's November 2020 ballot. Proposition 13 currently limits annual real estate tax increases of assessed value of real property. If the vote to remove these protections is successful, it would increase the assessed value and/or tax rates applicable to commercial property in California, including self storage properties. We currently have 83 consolidated properties and 10 unconsolidated properties in California. Accordingly, the amount of property taxes we pay in the future may increase substantially from what we have paid in the past or from what we expected in connection with our underwriting activities. If the property taxes we pay increase, our operating results and cash flow would be adversely impacted, and our ability to pay any expected dividends to our shareholders could be adversely affected.
Our storage leases are relatively short-term in nature, which exposes us to the risk that we may have to re-lease our units and we may be unable to do so on attractive terms, on a timely basis or at all.
Our storage leases are relatively short-term in nature, typically month-to-month, which exposes us to the risk that we may have to re-lease our units frequently and we may be unable to do so on attractive terms, on a timely basis or at all. Because these leases generally permit the tenant to leave at the end of the month without penalty, our revenues and operating results may be impacted by declines in market rental rates more quickly than if our leases were for longer terms. In addition, any delay in re-leasing units as vacancies arise would reduce our revenues and harm our operating results.
Security breaches through cyber-attacks, cyber-intrusions, or other methods could disrupt our information technology networks and related systems.
We and our PROs are increasingly dependent upon automated information technology processes and Internet commerce, and many of our and their tenants come from the telephone or over the Internet. Moreover, the nature of our and our PROs' business involves the receipt and retention of certain personal information about such tenants. In many cases, we and our PROs also rely significantly on third-party vendors to retain data, process transactions and provide other systems services. Our networks and operations could be disrupted, and sensitive data could be compromised, by physical or electronic security breaches, targeted against us, our PROs, our vendors or other

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organizations, including financial markets or institutions, including by way of or through cyber-attacks or cyber-intrusions over the Internet, malware, computer viruses, attachments to e-mails, phishing, employee theft or misuse, or inadequate security controls. Although we make efforts to protect the security and integrity of our networks and systems, there can be no assurance that these efforts and measures will be effective or that attempted security breaches or disruptions would not be successful, as such attacks and breaches may be difficult to detect (or not detected at all) and are becoming more sophisticated. In such event, we may experience business interruptions; data loss, ransom, misappropriation, or corruption; theft or misuse of confidential or proprietary information; or litigation and investigation by tenants, governmental or regulatory agencies, or other third parties, which could result in the payment of fines, penalties and other damages. Such events could also have other adverse impacts on us, including breaches of debt covenants or other contractual or REIT compliance obligations, late or misstated financial reports, and significant diversion of management attention and resources. As a result, such events could have a material adverse effect on our financial condition, results of operations and cash flows and harm our business reputation or have such effects on our PROs.
We may become subject to litigation or threatened litigation that may divert management's time and attention, require us to pay damages and expenses or restrict the operation of our business.
We may become subject to disputes, including class or collective actions, with customers (or prospective customers), employees, commercial parties with whom we maintain relationships or other parties with whom we do business or have interacted. Any such dispute could result in litigation between us and the other parties. Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention to its successful resolution (through litigation, settlement or otherwise), which would detract from our management's ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant and may not be covered by insurance. In addition, any such resolution could involve our agreement with terms that restrict the operation of our business.
There are other commercial parties, at both a local and national level, that may assert that our use of our brand names and other intellectual property conflict with their rights to use brand names and other intellectual property that they consider to be similar to ours. Any such commercial dispute and related resolution would involve all of the risks described above, including, in particular, our agreement to restrict the use of our brand name or other intellectual property.
We also could be sued for personal injuries and/or property damage occurring on our properties. The liability insurance we maintain may not cover all costs and expenses arising from such lawsuits.
The acquisition of new properties that lack operating history with us will make it more difficult to predict our operating results.
With respect to acquisitions, if we fail to accurately estimate occupancy levels, rental rates, operating costs or costs of improvements to bring an acquired property up to the standards established for our intended market position, the performance of the property may be below expectations. Acquired properties may have characteristics or deficiencies affecting their valuation or profitability potential that we have not yet discovered. We cannot assure that the performance of properties acquired by us will increase or be maintained following our acquisition.
Costs associated with complying with the ADA may result in unanticipated expenses.
Under the ADA, places of public accommodation are required to meet certain federal requirements related to access and use by disabled persons. A number of additional U.S. federal, state and local laws may also require modifications to our properties, or restrict certain further renovations of the properties, with respect to access thereto by disabled persons. Noncompliance with the ADA could result in the imposition of fines or an award of damages to private litigants and also could result in an order to correct any non-complying feature, which could result in substantial capital expenditures. If one or more of our properties is not in compliance with the ADA or other legislation, then we would be required to incur additional costs to bring the property into compliance. If we incur substantial costs to comply with the ADA or other legislation, our financial condition, results of operations, cash flow, per share trading price of our common shares and our ability to satisfy our debt service obligations and to make cash distributions to our shareholders could be adversely affected.

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Environmental compliance costs and liabilities associated with operating our properties may affect our results of operations.
Under various U.S. federal, state and local laws, ordinances and regulations, owners and operators of real estate may be liable for the costs of investigating and remediating certain hazardous substances or other regulated materials on or in such property. CERCLA and comparable state laws typically impose strict joint and several liabilities without regard to whether the owner or operator knew of, or was responsible for, the presence of such substances or materials. The presence of such substances or materials, or the failure to properly remediate such substances, may adversely affect the owner's or operator's ability to lease, sell or rent such property or to borrow using such property as collateral. Persons who arrange for the disposal or treatment of hazardous substances or other regulated materials may be liable for the costs of removal or remediation of such substances at a disposal or treatment facility, whether or not such facility is owned or operated by such person. Certain environmental laws impose liability for release of asbestos-containing materials into the air and third-parties may seek recovery from owners or operators of real properties for personal injury associated with asbestos-containing materials.
Certain environmental laws also impose liability, without regard to knowledge or fault, for removal or remediation of hazardous substances or other regulated materials upon owners and operators of contaminated property even after they no longer own or operate the property. Moreover, the past or present owner or operator of a property from which a release emanates could be liable for any personal injuries or property damages that may result from such releases, as well as any damages to natural resources that may arise from such releases.
Certain environmental laws impose compliance obligations on owners and operators of real property with respect to the management of hazardous materials and other regulated substances. For example, environmental laws govern the management of asbestos-containing materials and lead-based paint. Failure to comply with these laws can result in penalties or other sanctions.
In connection with the ownership, operation and management of our current or past properties and any properties that we may acquire and/or manage in the future, we could be legally responsible for environmental liabilities or costs relating to a release of hazardous substances or other regulated materials at or emanating from such property. In order to assess the potential for such liability, we conduct an environmental assessment of each property prior to acquisition and manage our properties in accordance with environmental laws while we own or operate them. We have engaged qualified, reputable and adequately insured environmental consulting firms to perform environmental site assessments of all of our properties prior to acquisition and are not aware of any environmental issues that are expected to materially impact the operations of any property.
No assurances can be given that existing environmental studies with respect to any of our properties reveal all environmental liabilities, that any prior owner or operator of our properties did not create any material environmental condition not known to us, or that a material environmental condition does not otherwise exist as to any one or more of our properties. There also exists the risk that material environmental conditions, liabilities or compliance concerns may have arisen after the review was completed or may arise in the future. Finally, future laws, ordinances or regulations and future interpretations of existing laws, ordinances or regulations may impose additional material environmental liability.
We rely on on-site personnel to maximize tenant satisfaction at each of our properties, and any difficulties we or they encounter in hiring, training and maintaining skilled on-site personnel may harm our operating performance.
The general professionalism of site managers and staff are contributing factors to a site's ability to successfully secure rentals and retain tenants and we rely on on-site personnel to maintain clean and secure self storage properties. If we or our PROs are unable to successfully recruit, train and retain qualified on-site personnel, the quality of service we and our PROs strive to provide at our properties could be adversely affected, which could lead to decreased occupancy levels and reduced operating performance of our properties.
We and certain of our PROs have tenant insurance- and/or tenant protection plan-related arrangements that are in some cases subject to state-specific governmental regulation, which may adversely affect our results.
We and certain of our PROs have tenant insurance- and/or tenant protection plan-related arrangements with regulated insurance companies and our tenants. Some of our PROs earn access fees in connection with these arrangements. We receive a portion of the fees from these PROs. The tenant insurance and tenant protection plan businesses, including the payments associated with these arrangements, are in some cases subject to state-specific

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governmental regulation. State regulatory authorities generally have broad discretion to grant, renew and revoke licenses and approvals, to promulgate, interpret and implement regulations, and to evaluate compliance with regulations through periodic examinations, audits and investigations of the affairs of insurance industry participants. Although these arrangements are managed by our property management platform and/or certain of our PROs who have developed marketing programs and management procedures to navigate the regulatory environment, as a result of regulatory or private action in any jurisdiction in which we operate, we may be temporarily or permanently suspended from continuing some or all of our tenant insurance- and/or tenant protection plan-related activities, or otherwise fined or penalized or suffer an adverse judgment, which could adversely affect our business and results of operations.
Privacy concerns could result in regulatory changes that may harm our business.
Personal privacy has become a significant issue in the jurisdictions in which we operate. Many jurisdictions in which we operate have imposed or in the future may impose restrictions and requirements on the use of personal information by those collecting such information. For example, the California Consumer Privacy Act of 2018, which became effective as of January 1, 2020, provides consumers with expansive rights and control over personal information obtained by or shared with certain covered businesses. Changes to law or regulations or the passage of new laws affecting privacy, if applicable to our business, could impose additional costs and liability on us and could limit our use and disclosure of such information.
Uninsured losses or losses in excess of our insurance coverage could adversely affect our financial condition, operating results and cash flow.
We maintain comprehensive liability, fire, flood, earthquake, wind (as deemed necessary or as required by our lenders), extended coverage and rental loss insurance with respect to our properties. Certain types of losses, however, may be either uninsurable or not economically insurable either in total or in part (due to location or otherwise), such as losses due to earthquakes, hurricanes, tornadoes, floods, riots, acts of war or terrorism. Should an uninsured loss occur, we could lose both our investment in and anticipated profits and cash flow from a property. In addition, if any such loss is insured, we may be required to pay significant amounts on any claim for recovery of such a loss prior to our insurer being obligated to reimburse us for the loss, or the amount of the loss may exceed our coverage for the loss. We currently self-insure a portion of our commercial insurance deductible risk through our captive insurance company. To the extent that our captive insurance company is unable to bear that risk, we may be required to fund additional capital to our captive insurance company or we may be required to bear that loss. As a result, our operating results may be adversely affected.
Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties.
Because real estate investments are relatively illiquid, our ability to promptly sell one or more properties in our portfolio in response to changing economic, financial and investment conditions is limited. The real estate market is affected by many factors, such as general economic conditions, availability of financing, interest rates and other factors, including supply and demand, that are beyond our control. We cannot predict whether we will be able to sell any property for the price or on the terms set by us or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We also cannot predict the length of time needed to find a willing purchaser and to close the sale of a property. In addition, we may be required to expend funds to correct defects or to make improvements before a property can be sold. We cannot assure you that we will have funds available to correct those defects or to make those improvements.
In acquiring a property, we may agree to transfer restrictions that materially restrict us from selling that property for a period of time or impose other restrictions, such as a limitation on the amount of debt that can be placed or repaid on that property. For example, we are party to certain agreements with our PROs that provide that, until March 31, 2023, our operating partnership shall not, and shall cause its subsidiaries not to, sell, dispose or otherwise transfer any property that is a part of the applicable self storage property portfolio relating to a series of subordinated performance units without the consent of the partners (including us) holding at least 50% of the then outstanding OP units and the partners holding at least 50% of the then outstanding series of subordinated performance units that relate to the applicable property, except for sales, dispositions or other transfers of a property to wholly owned subsidiaries of our operating partnership. These restrictions may require us to keep certain properties that we would otherwise sell, which could have an adverse effect on our results of operations, financial condition, cash flow and ability to execute our business plan.

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Our business could be harmed if key personnel terminate their employment with us.
Our success depends, to a significant extent, on the continued services of Arlen D. Nordhagen, Tamara D. Fischer and Brandon S. Togashi and the other members of our senior management team. We have entered into employment agreements with Mr. Nordhagen, Ms. Fischer and Mr. Togashi and these employment agreements provide for an initial three-year term of employment and automatic one-year extensions thereafter unless either party provides at least 90 days' notice of non-renewal. Notwithstanding these agreements, there can be no assurance that any of them will remain employed by us. The loss of services of one or more members of our senior management team could harm our business and our prospects.
We invest in strategic joint ventures that subject us to additional risks.
Some of our investments are, and in the future may be, structured as strategic joint ventures. Part of our strategy is to opportunistically partner with institutional funds and other institutional investors to acquire attractive portfolios through a promoted return structure. These arrangements are driven by the magnitude of capital required to complete the acquisitions and maintain the acquired portfolios. Such arrangements involve risks not present where a third party is not involved, including the possibility that partners or co-venturers might become bankrupt or otherwise fail to fund their share of required capital contributions. Additionally, partners or co-venturers might at any time have economic or other business interests or goals different from us and or in competition with us.
Joint ventures generally provide for a reduced level of control over an acquired project because governance rights are shared with others. Accordingly, certain major decisions relating to joint ventures, including decisions relating to, among other things, the approval of annual budgets, sales and acquisitions of properties, financings, and certain actions relating to bankruptcy, are often made by a majority vote of the investors or by separate agreements that are reached with respect to individual decisions. In addition, such decisions may be subject to the risk that the partners or co-venturers may make business, financial or management decisions with which we do not agree or take risks or otherwise act in a manner that does not serve our best interests. Because we may not have the ability to exercise control over such operations, we may not be able to realize some or all of the benefits that we believe will be created from our involvement. At times, we and our partners or co-venturers may also each have the right to trigger a buy-sell arrangement, which could cause us to sell our interest, or acquire our partners' or co-venturers' interest, at a time when we otherwise would not have initiated such a transaction. If any of the foregoing were to occur, our business, financial condition and results of operations could suffer as a result.
Risks Related to Our Structure and Our Relationships with Our PROs
Some of our PROs have limited experience operating under the Company's capital structure, and we may not be able to achieve the desired outcomes that the structure is intended to produce.
Some of our PROs have limited experience operating under our capital structure. As a means of incentivizing our PROs to drive operating performance and support the sustainability of the operating cash flow from the properties they manage on our behalf, we issued each PRO subordinated performance units aimed at aligning the interests of our PROs with our interests and those of our shareholders. The subordinated performance units are entitled to distributions exclusively tied to the performance of each PRO's managed portfolios but only after minimum performance thresholds are satisfied. Our issuance of such units, however, may have been and could be based on inaccurate valuations and thus misallocated, which would limit or eliminate the effectiveness of our intended incentive-based program. Moreover, difficulties in aligning incentives and implementing our structure could allow a PRO to underperform without triggering our right to terminate the applicable facilities portfolio and asset management agreements and transfer management rights of the PRO to us (or a designee) or cause our management to be distracted from other aspects of our business, which could adversely affect our operating results and business.
We are restricted in making certain property sales on account of agreements with our PROs that may require us to keep certain properties that we would otherwise sell.
The partnership unit designations related to our subordinated performance units provide that, until March 31, 2023, our operating partnership may not sell, dispose or otherwise transfer any property that is a part of the applicable self storage property portfolio relating to a series of subordinated performance units without the consent of the partners (including us) holding at least 50% of the then outstanding OP units and the consent of partners holding at least 50% of the then outstanding series of subordinated performance units that relate to the applicable property, except for sales, dispositions or other transfers of a property to wholly owned subsidiaries of our operating

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partnership. This restriction may require us to keep certain properties that we would otherwise sell, which could have an adverse effect on our results of operations, financial condition, cash flow and ability to execute our business plan. In addition, we may enter into agreements with future PROs that contain the same or similar restrictions or that impose such restrictions for different periods.
Our ability to terminate our facilities portfolio management agreements and asset management agreements with a PRO is limited, which may adversely affect our ability to execute our business plan.
We may elect to terminate our facilities portfolio management agreements and asset management agreements with a PRO and transfer property management responsibilities over the properties managed by such PRO to us (or our designee), (i) upon certain defaults by a PRO as set forth in these agreements, or (ii) if the PRO's properties, on a portfolio basis, fail to meet certain pre-determined performance thresholds for more than two consecutive calendar years or if the operating cash flow generated by the properties of the PRO for any calendar year falls below a level that will enable us to fund minimum levels of distributions, debt service payments attributable to the properties, and fund the properties' allocable operating expenses. Consequently, to the extent a PRO complies with these covenants, standards, and minimum requirements, we may not be able to terminate the applicable facilities portfolio management agreements and asset management agreements and transfer property management responsibilities over such properties even if our board of trustees believes that such PRO is not properly executing our business plan and/or is failing to operate its properties to their full potential. Moreover, transferring the management responsibilities over the properties managed by a PRO may be costly or difficult to implement or may be delayed, even if we are able to and believe that such a change in portfolio and property management would be beneficial to us and our shareholders.
We may less vigorously pursue enforcement of terms of agreements entered into with our PROs because of conflicts of interest with our PROs.
Our PROs are entities that have contributed or will contribute through contribution agreements, self storage properties, or legal entities owning self storage properties, to our operating partnership or DownREIT partnerships in exchange for ownership interests in our operating partnership or DownREIT partnerships. As part of each transaction, our PROs make and have made limited representations and warranties to our operating partnership regarding the entities, properties and other assets to be acquired by our operating partnership or DownREIT partnerships in the contribution and generally agree to indemnify our operating partnership for 12 months after the closing of the contribution for breaches of such representations. Such indemnification is limited, however, and our operating partnership is not entitled to any other indemnification in connection with the contributions. In addition, following each contribution from a PRO, the day-to-day operations of each of the managed properties will be managed by the PRO who was the principal of the applicable self storage property portfolios prior to the contribution. In addition, certain key persons of our PROs are members of our board of trustees, members of our PRO advisory committee or are executive officers of the Company. Consequently, we may choose not to enforce, or to enforce less vigorously, our rights under these agreements and any other agreements with our PROs due to our desire to maintain our ongoing relationship with our PROs, which could adversely affect our operating results and business.
We own self storage properties in some of the same geographic regions as our PROs and may compete for tenants with other properties managed by our PROs.
Pursuant to the facilities portfolio management agreements with our PROs, each PRO has agreed that, without our consent, the PRO will not, and it will cause its affiliates not to, enter into any new agreements or arrangements for the management of additional self storage properties, other than the properties we are not acquiring and the properties each PRO contributes to our operating partnership. However, we have not and will not acquire all of the self storage properties of our PROs. We will therefore own self storage properties in some of the same geographic regions as our PROs, and, as a result, we may compete for tenants with our PROs. This competition may affect our ability to attract and retain tenants and may reduce the rental rates we are able to charge, which could adversely affect our operating results and business.
Our PROs may engage in other activities, diverting their attention from the management of our properties, which could adversely affect the execution of our business plan and our operating results.
Our PROs and their employees and personnel are in the business of managing self storage properties. We have agreed that our PROs may continue to manage properties not included in our portfolio, and our PROs are not obligated to dedicate any specific employees or personnel exclusively to the management of our properties. As a

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result, their time and efforts may be diverted from the management of our properties, which could adversely affect the execution of our business plan and our operating results.
When a PRO elects or is required to "retire" we may become exposed to new and additional costs and risks.
Under the facilities portfolio management agreements, after a two year period following the later of completion of our initial public offering or the initial contribution of their properties to us, a PRO may elect, or be required, to "retire" from the self storage business. Upon a retirement event, management of the properties will be transferred to us (or our designee) in exchange for OP units with a value equal to four times the average of the normalized annual EBITDA from the management contracts related to such PRO's managed portfolio over the immediately preceding 24-month period. As a result of this transfer, we may become exposed to new and additional costs and risks. Accordingly, the retirement of a PRO may adversely effect our financial condition and operating results. For example, in connection with a retiring PRO's internalization into the Company, there can be no assurance that the Company will be able to retain such retiring PRO's employees, successfully hire new employees, or effectively integrate such employees and the retiring PRO's property management platform into the Company's or another PRO's property management platforms.
Our formation transactions and subsequent contribution transactions were generally not negotiated on an arm's-length basis and may not be as favorable to us as if they had been negotiated with unaffiliated third parties.
We did not conduct arm's-length negotiations with certain of the parties involved regarding the terms of the formation transactions and subsequent contribution transactions, including the contribution agreements, facilities portfolio management agreements, sales commission agreements, asset management agreements and registration rights agreements. In the course of structuring the formation transactions and subsequent contribution transactions, certain members of our senior management team and other contributors had the ability to influence the type and level of benefits that they received from us. Accordingly, the terms of the formation transactions and subsequent contribution transactions may not solely reflect the best interests of us or our shareholders and may be overly favorable to the other party to such transactions and agreements.
Conflicts of interest could arise with respect to certain transactions between the holders of OP units (including subordinated performance units), which include our PROs, on the one hand, and us and our shareholders, on the other.
Conflicts of interest could arise with respect to the interests of holders of OP units (including subordinated performance units), on the one hand, which include members of our senior management team, PROs, and trustees (including Arlen D. Nordhagen, our executive chairman of the board of trustees and former chief executive officer) and us and our shareholders, on the other. In particular, the consummation of certain business combinations, the sale, disposition or transfer of certain of our assets or the repayment of certain indebtedness that may be desirable to us and our shareholders could have adverse tax consequences to such unit holders. In addition, our trustees and officers have duties to the Company under applicable Maryland law in connection with their management of the Company. At the same time, we have fiduciary duties, as a general partner, to our operating partnership and to the limited partners under Delaware law in connection with the management of our operating partnership. Our duties as a general partner to our operating partnership and its partners may come into conflict with the duties of our trustees and officers to the Company and our shareholders. The partnership agreement of our operating partnership does not require us to resolve such conflicts in favor of either the Company or the limited partners in our operating partnership. Further, there can be no assurance that any procedural protections we implement to address these or other conflicts of interest will result in optimal outcomes for us and our shareholders.
The partnership agreement of our operating partnership contains provisions that may delay, defer or prevent a change in control.
The partnership agreement of our operating partnership provides that subordinated performance unit holders holding more than 50% of the voting power of the subordinated performance units must approve certain change of control transactions involving us unless, as a result of such transactions, the holders of subordinated performance units are offered a choice (1) to allow their subordinated performance units to remain outstanding without the terms thereof being materially and adversely changed or the subordinated performance units are converted into or exchanged for equity securities of the surviving entity having terms and conditions that are substantially similar to those of the subordinated performance units (it being understood that we may not be the surviving entity and that the parent of the surviving entity or the surviving entity may not be publicly traded) or (2) to receive for each subordinated performance unit an amount of cash, securities or other property payable to a holder of OP units had

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such holder exercised its right to exchange its subordinated performance units for OP units without taking into consideration a specified conversion penalty associated with such an exchange. In addition, in the case of any such change of control transactions in which we have not received the consent of OP unit holders holding more than 50% of the OP units (other than those held by the Company or its subsidiaries) and of subordinated performance unit holders holding more than 50% of the voting power of the subordinated performance units (other than those held by the Company or its subsidiaries), such transaction is required to be approved by a companywide vote of limited partners holding more than 50% of our outstanding OP units in which OP units (including for this purpose OP units held by us and our subsidiaries) are voted and subordinated performance units (not held by us and our subsidiaries) are voted on an applicable as converted basis and in which we will be deemed to vote the OP units held by us and our subsidiaries in proportion to the manner in which all of our outstanding common shares were voted at a shareholders meeting relating to such transaction. These approval rights could delay, deter, or prevent a transaction or a change in control that might involve a premium price for our common shares or otherwise be in the best interests of our shareholders.
We may change our investment and financing strategies and enter into new lines of business without shareholder consent, which may subject us to different risks.
We may change our business and financing strategies and enter into new lines of business at any time without the consent of our shareholders, which could result in our making investments and engaging in business activities that are different from, and possibly riskier than, the investments and businesses described in this document. A change in our strategy or our entry into new lines of business may increase our exposure to other risks or real estate market fluctuations.
Certain provisions of Maryland law could inhibit a change in our control.
Certain provisions of the Maryland General Corporation Law (the "MGCL") applicable to a Maryland real estate investment trust may have the effect of inhibiting a third-party from making a proposal to acquire us or of impeding a change in our control under circumstances that otherwise could provide the holders of our common shares with the opportunity to realize a premium over the then prevailing market price of such shares. The "business combination" provisions of the MGCL, subject to limitations, prohibit certain business combinations between a REIT and an "interested shareholder" (defined generally as any person who beneficially owns 10% or more of the voting power of our then outstanding voting shares or an affiliate or associate of ours who, at any time within the two-year period prior to the date in question, was the beneficial owner, directly or indirectly, of 10% or more of our then outstanding voting shares) or an affiliate thereof for five years after the most recent date on which the shareholder becomes an interested shareholder and, thereafter, imposes special appraisal rights and special shareholder voting requirements on these combinations. These provisions of the MGCL do not apply, however, to business combinations that are approved or exempted by the board of trustees of a REIT prior to the time that the interested shareholder becomes an interested shareholder. Pursuant to the statute, our board of trustees has by resolution exempted business combinations between us and (1) any other person, provided that the business combination is first approved by our board of trustees (including a majority of trustees who are not affiliates or associates of such person), (2) Arlen D. Nordhagen and any of his affiliates and associates and (3) any person acting in concert with the foregoing, from these provisions of the MGCL. As a result, such persons may be able to enter into business combinations with us that may not be in the best interests of our shareholders without compliance by us with the supermajority vote requirements and other provisions of the statute. This resolution, however, may be altered or repealed in whole or in part at any time. If this resolution is repealed, or our board of trustees does not otherwise approve a business combination, this statute may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer.
The "control share" provisions of the MGCL provide that holders of "control shares" of a Maryland real estate investment trust (defined as voting shares which, when aggregated with all other shares controlled by the shareholder, entitle the shareholder to exercise one of three increasing ranges of voting power in the election of trustees) acquired in a "control share acquisition" (defined as the direct or indirect acquisition of ownership or control of issued and outstanding "control shares," subject to certain exceptions) have no voting rights with respect to such shares except to the extent approved by our shareholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding votes entitled to be cast by the acquirer of control shares, our officers and our trustees who are also our employees. Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of our shares. There can be no assurance that this provision will not be amended or eliminated at any time in the future.

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Our authorized but unissued common and preferred shares may prevent a change in our control.
Our declaration of trust authorizes us to issue additional authorized but unissued common shares and preferred shares. In addition, our board of trustees may, without common shareholder approval, increase the aggregate number of our authorized shares or the number of shares of any class or series that we have authority to issue and classify or reclassify any unissued common shares or preferred shares, and may set or change the preferences, rights and other terms of any unissued classified or reclassified shares. As a result, among other things, our board may establish a class or series of common shares or preferred shares that could delay or prevent a transaction or a change in our control that might involve a premium price for our common shares or otherwise be in the best interests of our shareholders.
Our rights and the rights of our shareholders to take action against our trustees and officers are limited, which could limit your recourse in the event of actions not in your best interest.
Our declaration of trust limits the liability of our present and former trustees and officers to us and our shareholders for money damages to the maximum extent permitted under Maryland law. Under current Maryland law, our present and former trustees and officers will not have any liability to us or our shareholders for money damages other than liability resulting from:
•actual receipt of an improper benefit or profit in money, property or services; or 
•active and deliberate dishonesty by the trustee or officer that was established by a final judgment and is material to the cause of action.
Our declaration of trust authorizes us to indemnify our present and former trustees and officers for actions taken by them in those capacities to the maximum extent permitted by Maryland law. Our bylaws require us to indemnify each present and former trustee or officer, to the maximum extent permitted by Maryland law, in connection with any proceeding to which he or she is made, or threatened to be made, a party to or witness in by reason of his or her service to us as a trustee or officer or in certain other capacities. In addition, we may be obligated to pay or reimburse the expenses incurred by our present and former trustees and officers without requiring a preliminary determination of their ultimate entitlement to indemnification. As a result, we and our shareholders may have more limited rights against our present and former trustees and officers than might otherwise exist absent the current provisions in our declaration of trust and bylaws or that might exist with other companies, which could limit your recourse in the event of actions not in your best interest.
Our declaration of trust contains provisions that make removal of our trustees difficult, which could make it difficult for our shareholders to effect changes to our management.
Our declaration of trust provides that, subject to the rights of holders of one or more classes or series of preferred shares, a trustee may be removed with or without cause, by the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of trustees. Vacancies on our board of trustees generally may be filled only by a majority of the remaining trustees in office, even if less than a quorum. These requirements make it more difficult to change our management by removing and replacing trustees and may prevent a change in our control that is in the best interests of our shareholders.
Restrictions on ownership and transfer of our shares may restrict change of control or business combination opportunities in which our shareholders might receive a premium for their shares.
In order for us to qualify as a REIT for each taxable year, no more than 50% in value of our outstanding shares may be owned, directly or constructively, by five or fewer individuals during the last half of any calendar year, and at least 100 persons must beneficially own our shares during at least 335 days of a taxable year of 12 months, or during a proportionate portion of a shorter taxable year. "Individuals" for this purpose include natural persons, private foundations, some employee benefit plans and trusts, and some charitable trusts. To assist us in preserving our REIT qualification, among other purposes, our declaration of trust generally prohibits, among other limitations, any person from beneficially or constructively owning more than 9.8% in value or in number of shares, whichever is more restrictive, of our aggregate outstanding shares of all classes and series, the outstanding shares of any class or series of our preferred shares or our outstanding common shares. These ownership limits and the other restrictions on ownership and transfer of our shares contained in our declaration of trust could have the effect of discouraging a takeover or other transaction in which holders of our common shares might receive a premium for their shares over the then prevailing market price or which holders might believe to be otherwise in their best interests. Our board of

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trustees has established exemptions from these ownership limits which permits certain of our institutional investors to hold up to 20% of our common shares and up to 25% of our preferred shares.
Risks Related to Our Debt Financings
There are risks associated with our indebtedness.
There is no assurance that we will succeed in securing expansions of our credit facility, 2023 Term Loan Facility or 2028 Term Loan Facility, if we desire to do so.
Our level of debt and the limitations imposed on us by our debt agreements could have significant adverse consequences, including the following:
•our cash flow may be insufficient to meet our required principal and interest payments; 
•we may be unable to borrow additional funds as needed or on favorable terms, including to make acquisitions or to continue to make distributions required to maintain our qualification as a REIT; 
•we may be unable to refinance our indebtedness at maturity or the refinancing terms may be less favorable than the terms of our original indebtedness; 
•because a portion of our debt may bear interest at variable rates that are not hedged, a material increase in interest rates could materially increase our interest expense; 
•we may be forced to dispose of one or more of our properties, possibly on disadvantageous terms; 
•our debt level could place us at a competitive disadvantage compared to our competitors with less debt; 
•we may experience increased vulnerability to economic and industry downturns, reducing our ability to respond to changing business and economic conditions; 
•we may default on our obligations and the lenders or mortgagees may foreclose on our properties that secure their loans and receive an assignment of rents and leases; 
•we may default on our obligations and the lenders or mortgagees may enforce our guarantees; 
•we may violate restrictive covenants in our loan documents, which would entitle the lenders to accelerate our debt obligations; and 
•our default under any one of our mortgage loans with cross-default or cross-collateralization provisions could result in a default on other indebtedness or result in the foreclosures of other properties.
Disruptions in the financial markets could affect our ability to obtain debt financing on reasonable terms or at all and have other adverse effects on us.
Uncertainty in the credit markets may negatively impact our ability to access additional debt financing or to refinance existing debt maturities on favorable terms (or at all), which may negatively affect our ability to make acquisitions. A downturn in the credit markets may cause us to seek alternative sources of potentially less attractive financing, and may require us to adjust our business plans accordingly. In addition, these factors may make it more difficult for us to sell properties or may adversely affect the price we receive for properties that we do sell, as prospective buyers may experience increased costs of debt financing or difficulties in obtaining debt financing.
We depend on external sources of capital that are outside of our control, which could adversely affect our ability to acquire or develop properties, satisfy our debt obligations and/or make distributions to shareholders.
We depend on external sources of capital to acquire properties, to satisfy our debt obligations and to make distributions to our shareholders required to maintain our qualification as a REIT, and these sources of capital may not be available on favorable terms, or at all. Our access to external sources of capital depends on a number of factors, including the market's perception of our growth potential and our current and potential future earnings and our ability to continue to qualify as a REIT for U.S. federal income tax purposes. If we are unable to obtain external sources of capital, we may not be able to acquire properties when strategic opportunities exist, satisfy our debt obligations or make cash distributions to our shareholders that would permit us to qualify as a REIT or avoid paying tax on all of our net taxable income.

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Increases in interest rates may increase our interest expense and adversely affect our cash flow and our ability to service our indebtedness and make cash distributions to our shareholders, and our decision to hedge against interest rate risk might not be effective.
As of December 31, 2019, we had approximately $1.5 billion of debt outstanding, of which all debt subject to variable interest rates was fixed pursuant to interest rate swap agreements with no debt subject to variable interest rates (excluding variable-rate debt subject to interest rate swaps). Although the credit markets have recently experienced historic lows in interest rates, if interest rates rise, the interest rates on variable-rate debt that we may incur in the future could be higher than current levels, which could increase our financing costs and decrease our cash flow and our ability to pay cash distributions to our shareholders.
Although we have historically sought, and may in the future seek, to manage our exposure to interest rate volatility by using interest rate hedging arrangements, these arrangements may not be effective. Developing an effective interest rate risk strategy is complex and no strategy can completely insulate us from risks associated with interest rate fluctuations. Failure to hedge effectively against interest rate changes may adversely affect our financial condition, results of operations and ability to make cash distributions to our shareholders.
The terms and covenants relating to our indebtedness could adversely impact our economic performance.
Our credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility, 2029 Term Loan Facility and Senior Unsecured Notes contain (and any new or amended facility we may enter into from time to time will likely contain) customary affirmative and negative covenants, including financial covenants that, among other things, cap our total leverage at 60% of our gross asset value, provided, however, that we are permitted to maintain a ratio of up to 65% up to two (2) consecutive fiscal quarters immediately following the quarter in which a material acquisition (as defined in our credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility, 2029 Term Loan Facility and Senior Unsecured Notes) occurs, require us to have a maximum unsecured debt to unencumbered asset value ratio not to exceed 60%, provided, however, the we are be permitted to maintain a ratio of up to 65% up to two (2) consecutive fiscal quarters immediately following the quarter in which a material acquisition (as defined in our credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility, 2029 Term Loan Facility and Senior Unsecured Notes) occurs. In the event that we fail to satisfy our covenants, we would be in default under our credit agreements or note purchase agreement and may be required to repay such debt with capital from other sources. Under such circumstances, other sources of debt or equity capital may not be available to us, or may be available only on unattractive terms. Moreover, the presence of such covenants could cause us to operate our business with a view toward compliance with such covenants, which might not produce optimal returns for shareholders.
Uncertainty regarding the London interbank offered rate ("LIBOR") may adversely impact our borrowings and interest rating hedging.
In July 2017, the U.K. Financial Conduct Authority announced that it would cease to compel banks to participate in setting LIBOR as a benchmark by the end of 2021 (the "LIBOR Transition Date"). It is unclear if LIBOR will cease to exist at that time, whether new methods of calculating LIBOR will be established, or if an alternative reference rate will be established. The Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions convened by the U.S. Federal Reserve, has recommended the Secured Overnight Financing Rate ("SOFR") as a more robust reference rate alternative to U.S. dollar LIBOR. SOFR is calculated based on overnight transactions under repurchase agreements, backed by Treasury securities. SOFR is observed and backward looking, which stands in contrast with LIBOR under the current methodology, which is an estimated forward-looking rate and relies, to some degree, on the expert judgment of submitting panel members. Given that SOFR is a secured rate backed by government securities, it will be a rate that does not take into account bank credit risk (as is the case with LIBOR). SOFR is therefore likely to be lower than LIBOR and is less likely to correlate with the funding costs of financial institutions. Whether or not SOFR attains market traction as a LIBOR replacement tool remains in question. As such, the future of LIBOR at this time is uncertain. Many of our debt agreements and our interest rate swap agreements are linked to LIBOR, including our Credit Facility, 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility. Before the LIBOR Transition Date, we may need to amend such agreements that utilize LIBOR as a factor in determining the interest rate based on a new standard that is established, if any. However, these efforts may not be successful in mitigating the legal and financial risk from changing the reference rate in our legacy agreements. Furthermore, the transition away from LIBOR may adversely impact our ability to manage and hedge exposures to fluctuations in interest rates using derivative instruments. There is no guarantee that a transition from LIBOR to an alternative will not result in financial market

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disruptions, significant increases in benchmark rates, or borrowing costs to borrowers, any of which could have an adverse effect on our business, results of operations, financial condition, and the market price of our common shares.
Risks Related to Our Qualification as a REIT
Our failure to remain qualified as a REIT would subject us to U.S. federal income tax and applicable state and local taxes, which would reduce the amount of operating cash flow to our shareholders.
We have elected and we believe that we have qualified to be taxed as a REIT commencing with our taxable year ended December 31, 2015. We have not requested, and do not intend to request a ruling from the Internal Revenue Service ("IRS"), that we qualify as a REIT. Qualification as a REIT involves the application of highly technical and complex Code provisions and Treasury Regulations promulgated thereunder for which there are limited judicial and administrative interpretations. The complexity of these provisions and of applicable Treasury Regulations is greater in the case of a REIT that, like us, holds its assets through partnerships, and judicial and administrative interpretations of the U.S. federal income tax laws governing REIT qualification are limited. To qualify as a REIT, we must meet, on an ongoing basis through actual operating results, various tests regarding the nature and diversification of our assets and our income, the ownership of our outstanding shares and the amount of our distributions. Our compliance with the REIT income and quarterly asset requirements also depends upon our ability to manage successfully the composition of our income and assets on an ongoing basis. Our ability to satisfy these asset tests depends upon our analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain independent appraisals. Moreover, new legislation, court decisions or administrative guidance may, in each case possibly with retroactive effect, make it more difficult or impossible for us to qualify as a REIT. Thus, while we believe that we have been organized and operated and we intend to operate so that we will continue to qualify as a REIT, given the highly complex nature of the rules governing REITs, the ongoing importance of factual determinations and the possibility of future changes in our circumstances, no assurance can be given that we have qualified or will so qualify for any particular year. These considerations also might restrict the types of assets that we can acquire or services that we can provide in the future.
If we fail to qualify as a REIT in any taxable year, and we do not qualify for certain statutory relief provisions, we would be required to pay U.S. federal income tax on our taxable income at regular corporate rates, and distributions to our shareholders would not be deductible by us in determining our taxable income. In such a case, we might need to borrow money, sell assets, or reduce or even cease making distributions in order to pay our taxes. Our payment of income tax would reduce significantly the amount of operating cash flow to our shareholders. Furthermore, if we fail to maintain our qualification as a REIT, we no longer would be required to make distributions to our shareholders. In addition, unless we were eligible for certain statutory relief provisions, we could not re-elect to be taxed as a REIT until the fifth calendar year following the year in which we failed to qualify.
Even if we qualify as a REIT, we may face other tax liabilities that reduce our cash flow.
Even if we qualify for taxation as a REIT, we may be subject to certain U.S. federal, state and local taxes on our income and assets, including taxes on any undistributed income, state or local income and property and transfer taxes, including real property transfer taxes. In addition, we could, in certain circumstances, be required to pay an excise or penalty tax (which could be significant in amount) in order to utilize one or more relief provisions under the Code to maintain our qualification as a REIT. Any of these taxes would decrease operating cash flow to our shareholders. In addition, in order to meet the REIT qualification requirements, or to avert the imposition of a 100% tax that applies to certain gains derived by a REIT from dealer property or inventory, we may hold some of our assets or provide certain services to our tenants through one or more TRSs, or other subsidiary corporations that will be subject to corporate-level income tax at regular corporate rates. Any TRSs or other taxable corporations in which we invest will be subject to U.S. federal, state and local corporate taxes. Furthermore, if we acquire appreciated assets from a corporation that is or has been a subchapter C corporation in a transaction in which the adjusted tax basis of such assets in our hands is less than the fair market value of the assets, determined at the time we acquired such assets, and if we subsequently dispose of any such assets during the 5-year period following the acquisition of the assets from the C corporation, we will be subject to tax at the highest corporate tax rates on any gain from the disposition of such assets to the extent of the excess of the fair market value of the assets on the date that we acquired such assets over the basis of such assets on such date, which we refer to as built-in gains. Payment of these taxes generally could materially and adversely affect our income, cash flow, results of operations, financial condition, liquidity and prospects, and could adversely affect the value of our common shares and our ability to make distributions to our shareholders.

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Failure to make required distributions would subject us to tax, which would reduce the operating cash flow to our shareholders.
In order to qualify as a REIT, we must distribute to our shareholders each calendar year at least 90% of our net taxable income (excluding net capital gain). To the extent that we satisfy the 90% distribution requirement, but distribute less than 100% of our net taxable income (including net capital gain), we would be subject to U.S. federal corporate income tax on our undistributed net taxable income. In addition, we will incur a 4% non-deductible excise tax on the amount, if any, by which our distributions in any calendar year are less than a minimum amount specified under U.S. federal income tax laws. Although we intend to distribute our net taxable income to our shareholders in a manner intended to satisfy the REIT 90% distribution requirement and to avoid the 4% non-deductible excise tax, it is possible that we, from time to time, may not have sufficient cash to distribute 100% of our net taxable income. There may be timing differences between our actual receipt of cash and the inclusion of items in our income for U.S. federal income tax purposes. Accordingly, there can be no assurance that we will be able to distribute net taxable income to shareholders in a manner that satisfies the REIT distribution requirements and avoids the 4% non-deductible excise tax.
To maintain our REIT qualification, we may be forced to borrow funds during unfavorable market conditions.
In order to maintain our REIT qualification and avoid the payment of income and excise taxes, we may need to borrow funds to meet the REIT distribution requirements even if the then prevailing market conditions are not favorable for these borrowings. These borrowing needs could result from, among other things, timing differences between the actual receipt of cash and inclusion of income for federal income tax purposes, or the effect of non-deductible capital expenditures, the creation of reserves or required debt or amortization payments. These sources, however, may not be available on favorable terms or at all. Our access to third-party sources of capital depends on a number of factors, including the market's perception of our growth potential, our current debt levels, the per share trading price of our common shares, and our current and potential future earnings. We cannot assure you that we will have access to such capital on favorable terms at the desired times, or at all, which may cause us to curtail our investment activities and/or to dispose of assets at inopportune times, and could adversely affect our financial condition, results of operations, cash flows and our ability to pay distributions on, and the per share trading price of, our common shares.
Complying with the REIT requirements may cause us to forgo and/or liquidate otherwise attractive investments.
To qualify as a REIT, we must ensure that at least 75% of our gross income for each taxable year, excluding certain amounts, is derived from certain real property-related sources, and at least 95% of our gross income for each taxable year, excluding certain amounts, is derived from certain real property-related sources and passive income such as dividends and interest. In addition, we must ensure that, at the end of each calendar quarter, at least 75% of the value of our total assets consists of cash, cash items, U.S. government securities and qualified real estate assets. The remainder of our investment in securities generally cannot include more than 10% of the outstanding voting securities of any one issuer (other than U.S. government securities, securities of corporations that are treated as TRSs and qualified real estate assets) or more than 10% of the total value of the outstanding securities of any one issuer (other than government securities, securities of corporations that are treated as TRSs and qualified real estate assets). In addition, in general, no more than 5% of the value of our assets can consist of the securities of any one issuer (other than U.S. government securities, securities of corporations that are treated as TRSs and qualified real estate assets), no more than 20% of the value of our total assets can be represented by securities of one or more TRSs and no more than 25% of the value of our assets can consist of debt instruments issued by publicly offered REITs that are not otherwise secured by real property. If we fail to comply with these asset requirements at the end of any calendar quarter, we must correct the failure within 30 days after the end of the calendar quarter or qualify for certain statutory relief provisions to avoid losing our REIT qualification and suffering adverse tax consequences.
To meet these tests, we may be required to take or forgo taking actions that we would otherwise consider advantageous. For instance, in order to satisfy the gross income or asset tests applicable to REITs under the Code, we may be required to forgo investments that we otherwise would make. Furthermore, we may be required to liquidate from our portfolio otherwise attractive investments. In addition, we may be required to make distributions to shareholders at disadvantageous times or when we do not have funds readily available for distribution. These actions could reduce our income and amounts available for distribution to our shareholders. Thus, compliance with the REIT requirements may hinder our investment performance.

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We may be subject to a 100% tax on income from "prohibited transactions," and this tax may limit our ability to sell assets or require us to restructure certain of our activities in order to avoid being subject to the tax.
We will be subject to a 100% tax on any income from a prohibited transaction. "Prohibited transactions" generally include sales or other dispositions of property (other than property treated as foreclosure property under the Code) that is held as inventory or primarily for sale to customers in the ordinary course of a trade or business by a REIT, either directly or indirectly through certain pass-through subsidiaries. The characterization of an asset sale as a prohibited transaction depends on the particular facts and circumstances.
The 100% tax will not apply to gains from the sale of inventory that is held through a TRS or other taxable corporation, although such income will be subject to tax in the hands of the corporation at regular corporate income tax rates.
Our TRSs will be subject to U.S. federal income tax and will be required to pay a 100% penalty tax on certain income or deductions if our transactions with our TRSs are not conducted on arm's length terms.
We may conduct certain activities (such as facilitating sales by our PROs of tenant insurance, of which we receive a portion of the proceeds, selling packing supplies and locks and renting trucks or other moving equipment) through one or more TRSs.
A TRS is a corporation other than a REIT in which a REIT directly or indirectly holds stock, and that has made a joint election with such REIT to be treated as a TRS. If a TRS owns more than 35% of the total voting power or value of the outstanding securities of another corporation, such other corporation will also be treated as a TRS. Other than some activities relating to lodging and health care properties, a TRS may generally engage in any business, including the provision of customary or non-customary services to tenants of its parent REIT. A TRS is subject to U.S. federal income tax as a regular C corporation.
No more than 20% of the value of a REIT's total assets may consist of stock or securities of one or more TRSs. This requirement limits the extent to which we can conduct our activities through TRSs. The values of some of our assets, including assets that we hold through TRSs, may not be subject to precise determination, and values are subject to change in the future. Furthermore, if a REIT lends money to a TRS, the TRS may be unable to deduct all or a portion of the interest paid to the REIT, which could increase the tax liability of the TRS. In addition, the Code imposes a 100% tax on certain transactions between a TRS and its parent REIT that are not conducted on an arm's length basis. We intend to structure transactions with any TRS on terms that we believe are arm's length to avoid incurring the 100% excise tax described above. There can be no assurances, however, that we will be able to avoid application of the 100% tax.
If our operating partnership is treated as a corporation for U.S. federal income tax purposes, we will cease to qualify as a REIT.
We believe our operating partnership qualifies as a partnership for U.S. federal income tax purposes. As a partnership for U.S. federal income tax purposes, our operating partnership will not be subject to U.S. federal income tax on its income. Instead, each of its partners, including us, will be required to pay tax on its allocable share of our operating partnership's income. No assurance can be provided, however, that the IRS will not challenge our operating partnership's status as a partnership for U.S. federal income tax purposes, or that a court would not sustain such a challenge. If the IRS were successful in treating our operating partnership as a corporation for U.S. federal income tax purposes, we would fail to meet the gross income tests and certain of the asset tests applicable to REITs. As a result, we would cease to qualify as a REIT and both we and our operating partnership would become subject to U.S. federal, state and local income tax. The payment by our operating partnership of income tax would reduce significantly the amount of cash available to our operating partnership to satisfy obligations to make principal and interest payments on its debt and to make distribution to its partners, including us.
Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.
The REIT provisions of the Code may limit our ability to hedge our assets and operations. Under these provisions, any income that we generate from transactions intended to hedge our interest rate risk will be excluded from gross income for purposes of the REIT 75% and 95% gross income tests if (i) the instrument (a) hedges interest rate risk on liabilities used to carry or acquire real estate assets or (b) hedges an instrument described in clause (a) for a period following the extinguishment of the liability or the disposition of the asset that was previously hedged by the hedged instrument, and (ii) the relevant instrument is properly identified under applicable Treasury

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regulations. Income from hedging transactions that does not meet these requirements will generally constitute non-qualifying income for purposes of both the REIT 75% and 95% gross income tests. As a result of these rules, we may have to limit our use of hedging techniques that might otherwise be advantageous or implement those hedges through a TRS. This could increase the cost of our hedging activities because our TRS would be subject to tax on gains or expose us to greater risks associated with changes in interest rates than we would otherwise want to bear. In addition, losses in our TRS will generally not provide any tax benefit to us, although, subject to limitation, such losses may be carried forward to offset future taxable income of the TRS.
The ability of our board of trustees to revoke our REIT election without shareholder approval may cause adverse consequences to our shareholders.
Our declaration of trust provides that the board of trustees may revoke or otherwise terminate our REIT election, without the approval of our shareholders, if the board determines that it is no longer in our best interest to attempt to, or continue to, qualify as a REIT. If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our net taxable income and we generally would no longer be required to distribute any of our net taxable income to our shareholders, which may have adverse consequences on our total return to our shareholders.
Legislative or regulatory tax changes related to REITs could materially and adversely affect our business.
At any time, the U.S. federal income tax laws or regulations governing REITs or the administrative interpretations of those laws or regulations may be changed, possibly with retroactive effect. We cannot predict if or when any new U.S. federal income tax law, regulation or administrative interpretation, or any amendment to any existing U.S. federal income tax law, regulation or administrative interpretation, will be adopted, promulgated or become effective or whether any such law, regulation or interpretation may take effect retroactively. We and our shareholders could be adversely affected by any such change in, or any new, U.S. federal income tax law, regulation or administrative interpretation.
The TCJA, which was signed into law on December 22, 2017, significantly changes U.S. federal income tax laws applicable to businesses and their owners, including REITs and their shareholders, and may lessen the relative competitive advantage of operating as a REIT rather than as a C corporation. For additional discussion, see "U.S. Federal Income Tax Legislation".
Risks Related to Our Common Shares and Preferred Shares
Common shares and preferred shares eligible for future sale may have adverse effects on our share price.
Subject to applicable law and the rules of any stock exchange on which our shares may be listed or traded, our board of trustees, without common shareholder approval, may authorize us to issue additional authorized and unissued common shares and preferred shares on the terms and for the consideration it deems appropriate and may amend our declaration of trust to increase the total number of shares, or the number of shares of any class or series, that we are authorized to issue. In addition, our operating partnership may issue OP units, which are redeemable for cash or, at our option exchangeable on a one-for-one basis into common shares after an agreed period of time and certain other conditions, preferred units of limited partnership interest, which are redeemable for cash or, at our option exchangeable on a one-for-one basis into our 6.000% Series A cumulative redeemable preferred shares of beneficial interest ("Series A Preferred Shares") and subordinated performance units, which are only convertible into OP units beginning two years following the initial issuance of the applicable series and then (i) at the holder's election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at our election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations. Notwithstanding the two-year lock out period on conversions of subordinated performance units into OP units, if all such subordinated performance units were convertible into OP units as of December 31, 2019, each subordinated performance unit would on average hypothetically convert into 1.48 OP units, or into an aggregate of approximately 22.8 million OP units. These amounts are based on historical financial information for the trailing twelve months ended December 31, 2019. The hypothetical conversion is calculated by dividing the average cash available for distribution, or CAD, per subordinated performance unit by 110% of the CAD per OP unit over the same period. We anticipate that as our CAD grows over time, the conversion ratio will also grow, including to levels that may exceed this amount. The actual number of OP units into which such subordinated performance units will become convertible may vary significantly and will depend upon the applicable conversion penalty and the actual CAD to the OP units and the actual CAD to the converted subordinated performance units in the one-year period ending prior to conversion. We

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have also granted registration rights to those persons who will be eligible to receive common shares issuable upon exchange of OP units issued in our formation transactions and certain contribution transactions.
Pursuant to the registration rights agreements, we have filed a shelf registration statement on Form S-3 to register the offer and resale of the common shares issuable upon exchange of OP units (or securities convertible into or exchangeable for OP units and we expect to file a shelf registration statement on Form S-3 to register the offer and resale of the Series A Preferred Shares issuable upon the exchange of our 6.000% Series A-1 cumulative redeemable preferred units of limiting partnership interest ("Series A-1 preferred units") in the Company's operating partnership). We have the right to include common shares to be sold for our own account or other holders in the shelf registration statement. We are required to use all commercially reasonable efforts to keep such shelf registration statement continuously effective for a period ending when all common shares covered by the shelf registration statement are no longer Registrable Shares, as defined in the shelf registration statement.
We intend to bear the expenses incident to these registration requirements except that we will not bear the costs of (i) any underwriting fees, discounts or commissions, (ii) out-of-pocket expenses of the persons exercising the registration rights or (iii) transfer taxes.
We cannot predict the effect, if any, of future sales of our common or preferred shares or the availability of shares for future sales, on the market price of our common or preferred shares. The market price of our common shares may decline significantly when the restrictions on resale by certain of our shareholders lapse. Sales of substantial amounts of common or preferred shares or the perception that such sales could occur may adversely affect the prevailing market price for our common shares.
We cannot assure our ability to pay dividends in the future.
Historically, we have paid quarterly common share dividends to our shareholders and quarterly distributions to our operating partnership unitholders, and we intend to continue to pay quarterly dividends to our shareholders and to make quarterly distributions to our operating partnership unitholders in amounts such that all or substantially all of our net taxable income in each year is distributed, which, along with other factors, should enable us to continue to qualify for the tax benefits accorded to a REIT under the Code. We have not established a minimum dividends payment level, and all future distributions will be made at the discretion of our board of trustees. Our ability to pay dividends will depend upon, among other factors:
•the operational and financial performance of our properties; 
•capital expenditures with respect to existing and newly acquired properties; 
•general and administrative expenses associated with our operation as a publicly-held REIT;
•maintenance of our REIT qualification;
•the amount of, and the interest rates on, our debt and the ability to refinance our debt;
•the absence of significant expenditures relating to environmental and other regulatory matters; and 
•other risk factors described in this Annual Report on Form 10-K.
Certain of these matters are beyond our control and any significant difference between our expectations and actual results could have a material adverse effect on our cash flow and our ability to make distributions to shareholders.
Future offerings of debt or equity securities, which may rank senior to our common shares, may adversely affect the market price of our common shares.
If we decide to issue debt securities in the future, which would rank senior to our common shares, it is likely that they will be governed by an indenture or other instrument containing covenants restricting our operating flexibility. Additionally, any equity securities or convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common shares and may result in dilution to owners of our common shares. We and, indirectly, our shareholders will bear the cost of issuing and servicing such securities. Because our decision to issue debt or equity securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, holders of our common shares will bear the risk of our future offerings reducing the market price of our common shares and diluting the value of their share holdings in us.

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Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
As of December 31, 2019, we held ownership interests in and operated a geographically diversified portfolio of 742 self storage properties, located in 35 states and Puerto Rico, comprising approximately 47.1 million rentable square feet, configured in approximately 378,000 storage units. Of these properties, we consolidated 567 self storage properties that contain approximately 34.5 million rentable square feet and we held a 25% ownership interest in 175 unconsolidated real estate venture properties that contain approximately 12.6 million rentable square feet.
The following table sets forth summary information regarding our consolidated properties by state as of December 31, 2019.
Number of Number of Rentable % of Rentable Period-end
State/Territory Properties Units Square Feet Square Feet Occupancy
California(1)
83    49,618    6,226,952    18.1  % 88.4  %
Texas 71    29,465    4,218,584    12.2  % 86.6  %
Oregon 61    24,498    3,105,199    8.9  % 81.1  %
Florida 46    28,956    3,021,295    8.8  % 86.4  %
Georgia 44    19,044    2,547,949    7.4  % 87.7  %
North Carolina 33    15,377    1,885,479    5.5  % 90.8  %
Arizona 31    16,893    1,925,442    5.6  % 86.9  %
Oklahoma 30    13,848    1,902,842    5.5  % 87.5  %
Louisiana(1)
26    12,336    1,538,959    4.5  % 84.8  %
Indiana 16    8,777    1,134,820    3.3  % 89.6  %
Kansas 16    5,713    763,249    2.2  % 86.6  %
Washington 14    4,496    578,723    1.7  % 80.1  %
Nevada 13    6,678    844,811    2.4  % 89.4  %
Colorado 11    5,048    615,456    1.8  % 84.2  %
New Hampshire 11    4,727    576,995    1.7  % 90.3  %
Missouri 9    3,859    490,023    1.4  % 74.7  %
Ohio 8    3,642    461,393    1.3  % 88.5  %
Puerto Rico 6    4,460    431,612    1.3  % 89.9  %
Pennsylvania 6    2,647    298,615    0.9  % 89.4  %
New Mexico 5    3,108    389,743    1.1  % 87.1  %
Illinois 4    1,993    271,136    0.8  % 86.0  %
Maryland 4    1,993    214,337    0.6  % 88.5  %
South Carolina 4    1,212    147,580    0.4  % 91.2  %
Idaho 3    843    170,229    0.5  % 94.3  %
Massachusetts 3    1,737    166,650    0.5  % 95.0  %
Mississippi 3    864    114,311    0.3  % 79.6  %
New Jersey 3    1,436    191,124    0.6  % 83.7  %
Kentucky 1    380    60,950    0.2  % 83.7  %
Alabama 1    762    110,616    0.3  % 84.7  %
Virginia 1    597    80,335    0.2  % 83.4  %
Total/Weighted Average 567    275,007    34,485,409    100.0  % 86.8  %
(1) Six of the California properties and two of the Louisiana properties are subject to non-cancelable leasehold interest agreements that are classified as operating leases. See "Note 13. Leases" in Item 8. "Financial Statements and Supplementary Data."

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The following table sets forth summary information regarding our unconsolidated real estate venture properties by state as of December 31, 2019.
Number of Number of Rentable % of Rentable Period-end
State Properties Units Square Feet Square Feet Occupancy
Florida 27    15,374    1,721,835    13.6  % 81.7  %
Michigan 24    15,616    1,977,773    15.7  % 87.6  %
New Jersey 15    10,524    1,225,838    9.7  % 88.1  %
Alabama 14    5,533    826,475    6.6  % 86.1  %
Ohio 14    8,787    1,064,746    8.4  % 85.6  %
Georgia 11    6,141    872,333    6.9  % 87.0  %
California 10    6,197    754,379    6.0  % 87.2  %
Other(1)
60    34,938    4,171,544    33.1  % 84.6  %
Total 175    103,110    12,614,923    100.0  % 85.5  %

(1) Other states in the unconsolidated real estate ventures include Arizona, Delaware, Illinois, Massachusetts, Minnesota, Mississippi, Nevada, New York, Oklahoma, Pennsylvania, Rhode Island, Tennessee, Texas and Virginia.
Our portfolio consists of self storage properties that are designed to offer customers convenient, affordable, and secure storage units. Generally, our properties are in highly visible locations clustered in states or markets with strong population and job growth and are specifically designed to accommodate residential and commercial tenants with features such as security systems, electronic gate entry, easy access, climate control, and pest control. Our units typically range from 25 square feet to 300 square feet, and some of our properties also offer outside storage for vehicles, boats, and equipment. We provide 24-hour access to many storage units through computer controlled access systems, as well as alarm and sprinkler systems on many of our individual storage units. Almost all of the storage units in our portfolio are leased on a month-to-month basis providing us the flexibility to increase rental rates over time as market conditions permit. Additional information on our consolidated self storage properties is contained in "Schedule III - Real Estate and Accumulated Depreciation" in this Annual Report on Form 10-K.
Item 3. Legal Proceedings
We are not currently subject to any legal proceedings that we consider to be material.
Item 4. Mine Safety Disclosures
Not applicable.

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PART II
Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Our common shares have been listed and traded on the NYSE under the symbol "NSA" since April 22, 2015. Prior to that time there was no public market for our common shares.
Holders
As of February 25, 2020, the Company had 55 record holders of its common shares. The 55 holders of record do not include the beneficial owners of common shares whose shares are held by a broker or bank. Such information was obtained from our transfer agent and registrar.
Dividends
Since our initial quarter as a publicly-traded REIT, we have made regular quarterly distributions to our shareholders. Holders of common shares are entitled to receive distributions when declared by our board of trustees out of any assets legally available for that purpose. In order to maintain our status as a REIT, we are required to distribute at least 90% of our "REIT taxable income," which is generally equivalent to our net taxable ordinary income, determined without regard to the deduction for dividends paid and excluding net capital gains to our shareholders annually in order to maintain our REIT qualification for U.S. federal income tax purposes.
Common share dividends are characterized for U.S. federal income tax purposes as ordinary income, capital gains, return of capital or a combination thereof. Each year we communicate to shareholders the tax characterization of the common share dividends paid during the preceding year. Our tax return for the year ended December 31, 2019 has not yet been filed and consequently, the taxability information presented for our dividends paid in 2019 is based upon management's estimate. The following table summarizes the taxability of our dividends per common share for the year ended December 31, 2019:
Year Ended
December 31, 2019
Ordinary Income $ 0.841586    66.3  %
Return of Capital 0.428414    33.7  %
Total $ 1.270000    100.0  %
Equity Compensation Plan Information
Information about our equity compensation plans is incorporated by reference to Item 12 of Part III of this Annual Report on Form 10-K.
Unregistered Sales of Equity Securities
During the three months ended December 31, 2019, the Company, in its capacity as general partner of its operating partnership, caused the operating partnership to issue 293,522 common shares to satisfy redemption requests from certain limited partners.
On October 24, 2019, the operating partnership issued 21,752 subordinated performance units to an affiliate of Moove In, one of the Company's existing PROs, in exchange for cash in connection with the acquisition of a self storage property.
On December 18, 2019, the operating partnership issued 6,662 OP units and 20,197 subordinated performance units to an affiliate of Hide-Away, one of the Company's existing PROs, in connection with the acquisition of a self storage property.
On December 19, 2019, the operating partnership issued 11,100 subordinated performance units to an affiliate of Personal Mini, one of the Company's existing PROs, in exchange for cash in connection with the acquisition of a self storage property.
On January 16, 2020, the operating partnership issued 73,329 OP units to an unrelated third party in connection with the acquisition of a self storage property.

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On January 16, 2020, the operating partnership issued 13,105 subordinated performance units to an affiliate of Move It, one of the Company's existing PROs, in exchange for cash in connection with the acquisition of a self storage property.
As of February 25, 2020, other than those OP units held by the Company, 33,301,798 OP units were outstanding (including 773,568 outstanding Long-Term Incentive Plan Units ("LTIP units") and 1,848,261 outstanding OP units in certain consolidated subsidiaries of the operating partnership ("DownREIT OP units"), which are convertible into, or exchangeable for, OP units on a one-for-one basis, subject to certain conditions).
These issuances were exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended.
Performance Graph
The following chart compares the yearly cumulative total shareholder return for our common shares with the cumulative shareholder return of companies on (i) the S&P 500 Index, (ii) the Russell 2000 and (iii) the Nareit All Equity REIT Index as provided by Nareit for the period beginning April 23, 2015 and ending December 31, 2019.
NSA-20191231_G1.JPG
Period Ending
Index 4/23/2015 12/31/2015 12/31/2016 12/31/2017 12/31/2018 12/31/2019
National Storage Affiliates Trust $ 100    $ 137    $ 184    $ 238    $ 240    $ 318   
S&P 500 100    98    110    134    128    168   
Russell 2000 100    91    109    126    112    140   
Nareit All Equity REIT Index 100    101    109    119    114    147   
The foregoing item assumes $100.00 invested on April 23, 2015, with dividends reinvested. The Performance Graph will not be deemed to be incorporated by reference into any filing by NSA under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that NSA specifically incorporates the same by reference.

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Item 6. Selected Financial Data
The following table sets forth our selected historical financial and operating data as of and for the periods indicated. You should read the information below in conjunction with the financial statements and notes thereto included in Item 8. "Financial Statements and Supplementary Data" and Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" in this Annual Report on Form 10-K or in previous filings with the SEC. Dollars in the following table are in thousands, except per share amounts.
Year Ended December 31,
2019 2018 2017 2016 2015
OPERATING DATA:
Total revenue
$ 387,896    $ 330,896    $ 268,130    $ 199,046    $ 133,919   
Total operating expenses
261,047    229,242    189,630    141,390    102,328   
Net income
66,013    56,326    45,998    24,866    4,796   
Net (income) loss attributable to noncontrolling interests (62,030)   (42,217)   (43,037)   (6,901)   7,644   
Net income attributable to the Company
3,983    14,109    2,961    17,965    12,440   
Earnings (loss) per share—basic
$ (0.15)   $ 0.07    $ 0.01    $ 0.60    $ 0.80   
Earnings (loss) per share—diluted
$ (0.15)   $ 0.07    $ 0.01    $ 0.31    $ 0.17   
Weighted average shares outstanding—basic (in thousands)
58,208    53,293    44,423    29,887    15,463   
Weighted average shares outstanding—diluted (in thousands)
58,208    53,293    44,423    78,747    45,409   
Dividends declared per common share
$ 1.27    $ 1.16    $ 1.04    $ 0.88    $ 0.54   
BALANCE SHEET DATA (at end of period)
Self storage properties, net
$ 2,753,897    $ 2,391,462    $ 2,104,875    $ 1,733,533    $ 1,079,101   
Total assets
3,084,245    2,729,263    2,266,730    1,892,092    1,099,049   
Debt financing
1,534,047    1,278,102    958,097    878,954    567,795   
Total equity
$ 1,452,101    $ 1,402,299    $ 1,271,487    $ 979,068    $ 516,047   
OTHER DATA (at end of period)
Number of properties(1)
567    499    444    382    277   
Rentable square feet (in thousands)(2)
34,485    30,366    27,182    23,077    15,770   
Occupancy percentage(3)
87  % 87  % 87  % 88  % 89  %

(1) For a discussion of our acquisition and disposition activity during the years ended December 31, 2019 and 2018, see "Note 6. Self Storage Property Acquisitions and Dispositions" in Item 8. "Financial Statements and Supplementary Data."
(2) Rentable square feet includes all enclosed self storage units but excludes commercial, residential, and covered parking space. 
(3) Represents total occupied rentable square feet divided by total rentable square feet as of the end of the period.


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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the financial statements and notes thereto included in Item 8. "Financial Statements and Supplementary Data" as well as Item 1. "Business," Item 1A. "Risk Factors," and Item 2. "Properties," respectively, in this Annual Report on Form 10-K.
Overview
National Storage Affiliates Trust is a fully integrated, self-administered and self-managed real estate investment trust organized in the state of Maryland on May 16, 2013. We have elected and we believe that we have qualified to be taxed as a REIT commencing with our taxable year ended December 31, 2015. We serve as the sole general partner of our operating partnership, a Delaware limited partnership formed on February 13, 2013 to conduct our business, which is focused on the ownership, operation, and acquisition of self storage properties located within the top 100 MSAs throughout the United States.
Our Structure
Our structure promotes operator accountability as subordinated performance units issued to our PROs in exchange for the contribution of their properties are entitled to distributions only after those properties satisfy minimum performance thresholds. In the event of a material reduction in operating cash flow, distributions on our subordinated performance units will be reduced before or disproportionately to distributions on our common shares held by our common shareholders. In addition, we expect our PROs will generally co-invest subordinated equity in the form of subordinated performance units in each acquisition that they source, and the value of these subordinated performance units will fluctuate with the performance of their managed portfolios. Therefore, our PROs are incentivized to select acquisitions that are expected to exceed minimum performance thresholds, thereby increasing the value of their subordinated equity stake. We expect that our shareholders will benefit from the higher levels of property performance that our PROs are incentivized to deliver.
Our PROs
We had ten PROs as of December 31, 2019: SecurCare, Northwest, Optivest, Guardian, Move It, Storage Solutions, Hide Away, Personal Mini, Southern and Moove In. We seek to further expand our platform by continuing to recruit additional established self storage operators, while integrating our operations through the implementation of centralized initiatives, including management information systems, revenue enhancement, and cost optimization programs. Our national platform allows us to capture cost savings by eliminating redundancies and utilizing economies of scale across the property management platforms of our PROs while also providing greater access to lower-cost capital.
Our Consolidated Properties
We seek to own properties that are well located in high quality sub-markets with highly accessible street access and attractive supply and demand characteristics, providing our properties with strong and stable cash flows that are less sensitive to the fluctuations of the general economy. Many of these markets have multiple barriers to entry against increased supply, including zoning restrictions against new construction and new construction costs that we believe are higher than our properties' fair market value.
As of December 31, 2019, we owned a geographically diversified portfolio of 567 self storage properties, located in 29 states and Puerto Rico, comprising approximately 34.5 million rentable square feet, configured in approximately 275,000 storage units. Of these properties, 265 were acquired by us from our PROs, 301 were acquired by us from third-party sellers and one was acquired by us from the 2016 Joint Venture.
Our Unconsolidated Real Estate Ventures
We seek to opportunistically partner with institutional funds and other institutional investors to acquire attractive portfolios utilizing a promoted return structure. We believe there is significant opportunity for continued external growth by partnering with institutional investors seeking to deploy capital in the self storage industry.

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2018 Joint Venture
As of December 31, 2019, our 2018 Joint Venture, in which we have a 25% interest, owned and operated a portfolio of 103 properties containing approximately 7.7 million rentable square feet, configured in approximately 63,000 storage units and located across 17 states.
2016 Joint Venture
As of December 31, 2019, our 2016 Joint Venture, in which we have a 25% ownership interest, owned and operated a portfolio of 72 properties containing approximately 4.9 million rentable square feet, configured in approximately 40,000 storage units and located across 13 states.
During the year ended December 31, 2019, our 2016 Joint Venture sold to the Company one self storage property for $4.1 million, comprising less than 0.1 million rentable square feet, configured in approximately 300 storage units.
Our Property Management Platform
Through our property management platform, branded iStorage, we direct, manage and control the day-to-day operations and affairs of certain consolidated properties and our unconsolidated real estate ventures. We earn certain customary fees for managing and operating the properties in the unconsolidated real estate ventures and we facilitate tenant insurance and/or tenant warranty protection programs for tenants at these properties in exchange for half of all proceeds from such programs.
As of December 31, 2019, our property management platform managed and controlled 42 of our consolidated properties in select markets in California, Illinois, Kansas, Maryland, Missouri, Ohio, Texas and Virginia.
Results of Operations
When reviewing our results of operations it is important to consider the timing of acquisition activity. We acquired 69 self storage properties during the year ended December 31, 2019 and 57 self storage properties during the year ended December 31, 2018. As a result of these and other factors, we do not believe that our historical results of operations discussed and analyzed below are comparable or necessarily indicative of our future results of operations or cash flows.
To help analyze the operating performance of our self storage properties, we also discuss and analyze operating results relating to our same store portfolio. Our same store portfolio is defined as those properties owned and operated since the first day of the earliest year presented, excluding any properties sold, expected to be sold or subject to significant changes such as expansions or casualty events which cause the portfolio's year-over-year operating results to no longer be comparable.
The following discussion and analysis of the results of our operations and financial condition for the year ended December 31, 2019 compared to the year ended December 31, 2018 should be read in conjunction with the accompanying consolidated financial statements included in Item 8. The discussion and analysis of the results of our operations and financial condition for the year ended December 31, 2018 compared to the year ended December 31, 2017, can be found in Part II, "Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the year ended December 31, 2018, which was filed with the SEC on February 26, 2019.
Certain figures, such as interest rates and other percentages, included in this section have been rounded for ease of presentation. Percentage figures included in this section have not in all cases been calculated on the basis of such rounded figures but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this section may vary slightly from those obtained by performing the same calculations using the figures in our consolidated financial statements or in the associated text. Certain other amounts that appear in this section may similarly not sum due to rounding.

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Year Ended December 31, 2019 compared to the Year Ended December 31, 2018
Net income was $66.0 million for the year ended December 31, 2019, compared to $56.3 million for the year ended December 31, 2018, an increase of $9.7 million. The increase was primarily due to an increase in net operating income ("NOI") resulting from self storage properties acquired during 2018 and 2019, increases in management fees and other revenue, partially offset by increases in depreciation and amortization, interest expense and general and administrative expenses. For a description of NOI, see "Non-GAAP Financial measures – NOI".
Overview
As of December 31, 2019, our same store portfolio consisted of 439 self storage properties. See "---Results of Operations" above for the definition of our same store portfolio. The following table illustrates the changes in rental revenue, other property-related revenue, management fees and other revenue, property operating expenses, and other expenses for the year ended December 31, 2019 compared to the year ended December 31, 2018 (dollars in thousands):
Year Ended December 31,
2019 2018 Change
Rental revenue
Same store portfolio
$ 287,179    $ 276,377    $ 10,802   
Non-same store portfolio
67,680    23,462    44,218   
Effect of bad debt expense classification resulting from adoption of leasing standard
—    8,564    (8,564)  
Total rental revenue
354,859    308,403    46,456   
Other property-related revenue
Same store portfolio
9,998    9,443    555   
Non-same store portfolio
2,304    740    1,564   
Total other property-related revenue
12,302    10,183    2,119   
Property operating expenses
Same store portfolio
88,694    87,262    1,432   
Non-same store portfolio
21,653    8,049    13,604   
Effect of bad debt expense classification resulting from adoption of leasing standard
—    8,564    (8,564)  
Total property operating expenses
110,347    103,875    6,472   
Net operating income
Same store portfolio
208,483    198,558    9,925   
Non-same store portfolio
48,331    16,153    32,178   
Total net operating income
256,814    214,711    42,103   
Management fees and other revenue 20,735    12,310    8,425   
General and administrative expenses (45,581)   (36,220)   (9,361)  
Depreciation and amortization (105,119)   (89,147)   (15,972)  
Other (expense) income
Interest expense (56,464)   (42,724)   (13,740)  
Equity in losses of unconsolidated real estate ventures
(4,970)   (1,423)   (3,547)  
Acquisition costs (1,317)   (663)   (654)  
Non-operating income (expense) 452    (91)   543   
Gain on sale of self storage properties 2,814    391    2,423   
Other expense
(59,485)   (44,510)   (14,975)  
Income before income taxes
67,364    57,144    10,220   
Income tax expense
(1,351)   (818)   (533)  
Net income
66,013    56,326    9,687   

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Year Ended December 31,
2019 2018 Change
Net income attributable to noncontrolling interests (62,030)   (42,217)   (19,813)  
Net income attributable to National Storage Affiliates Trust
3,983    14,109    (10,126)  
Distributions to preferred shareholders (12,390)   (10,350)   (2,040)  
Net (loss) income attributable to common shareholders
$ (8,407)   $ 3,759    $ (12,166)  
Total Revenue
Our total revenue increased by $57.0 million, or 17.2%, for the year ended December 31, 2019, as compared to the year ended December 31, 2018. This increase was primarily attributable to incremental revenue from 69 self storage properties acquired during the year ended December 31, 2019, increases in management fees and other revenue from our unconsolidated real estate ventures and regular rental increases for in-place tenants.
Rental Revenue
Rental revenue increased by $46.5 million, or 15.1%, for the year ended December 31, 2019, as compared to the year ended December 31, 2018. As discussed in Note 2 to the consolidated financial statements in Item 8, we adopted ASU 2016-02 and ASU 2018-11 effective January 1, 2019. As a result of this adoption, beginning on January 1, 2019, activity related to uncollectible accounts is recognized as a current-period adjustment within revenue. For periods prior to January 1, 2019, such amounts were previously included in operating expenses, and as such, for comparability, we have presented $8.6 million of activity related to uncollectible accounts as a reduction to same store and non-same store rental revenue for the year ended December 31, 2018. The increase in rental revenue was due to a $44.2 million increase in non-same store rental revenue which was primarily attributable to incremental rental revenue of $29.6 million from 69 self storage properties acquired during 2019, and $15.4 million from 57 self storage properties acquired during 2018. Same store portfolio rental revenues increased $10.8 million, or 3.9%, due to a 3.5% increase, from $11.58 to $11.98, in annualized same store rental revenue (including fees and net of any discounts and uncollectible customer amounts) divided by average occupied square feet ("average annualized rental revenue per occupied square foot"), driven primarily by increased contractual lease rates for in-place tenants and fees and an increase in average occupancy from 88.5% for the year ended December 31, 2018 to 88.8% for the year ended December 31, 2019. Average occupancy is calculated based on the average of the month-end occupancy immediately preceding the period presented and the month-end occupancies included in the respective period presented.
Other Property-Related Revenue
Other property-related revenue represents ancillary income from our self storage properties, such as tenant insurance-related access fees and sales of storage supplies. Other property-related revenue increased by $2.1 million, or 20.8%, for the year ended December 31, 2019, as compared to the year ended December 31, 2018. This increase primarily resulted from a $1.6 million increase in non-same store other property-related revenue which was primarily attributable to incremental other property-related revenue of $0.8 million from 69 self storage properties acquired during 2019, and $0.8 million from 57 self storage properties acquired during 2018.
Management Fees and Other Revenue
Management fees and other revenue, which are primarily related to managing and operating the unconsolidated real estate ventures, were $20.7 million for the year ended December 31, 2019, compared to $12.3 million for the year ended December 31, 2018, an increase of $8.4 million or 68.4%. This increase was primarily attributable to incremental fees earned from the 2018 Joint Venture following the acquisition of the Initial 2018 JV Portfolio (as defined in Note 2 to the consolidated financial statements in Item 8) in September 2018.
Property Operating Expenses
Property operating expenses were $110.3 million for the year ended December 31, 2019 compared to $103.9 million for the year ended December 31, 2018, an increase of $6.4 million, or 6.2%. As discussed in Note 2 to the consolidated financial statements in Item 8, we adopted ASU 2016-02 and ASU 2018-11 effective January 1, 2019. As a result of this adoption, beginning on January 1, 2019, activity related to uncollectible accounts is recognized as a current-period adjustment within revenue. For periods prior to January 1, 2019, such amounts were previously

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included in operating expenses, and as such, for comparability, we have presented $8.6 million of activity related to uncollectible accounts as a reduction to same store and non-same store property operating expenses for the year ended December 31, 2018. The increase in property operating expenses resulted from a $13.6 million increase in non-same store property operating expenses that was primarily attributable to incremental property operating expenses of $9.3 million from 69 self storage properties acquired during 2019, and $4.6 million from 57 self storage properties acquired during 2018.
General and Administrative Expenses
General and administrative expenses increased $9.4 million, or 25.8%, for the year ended December 31, 2019, compared to the year ended December 31, 2018. This increase was attributable to increases in supervisory and administrative fees charged by our PROs of $3.1 million primarily as a result of incremental fees related to the 69 self storage properties acquired during 2019, costs related to our property management platform of $2.3 million, salaries and benefits of $2.2 million, equity-based compensation expense of $0.7 million and $1.1 million of other general and administrative expenses.
Depreciation and Amortization
Depreciation and amortization increased $16.0 million, or 17.9%, for the year ended December 31, 2019, compared to the year ended December 31, 2018. This increase was primarily attributable to incremental depreciation expense related to the 69 self storage properties acquired during 2019, partially offset by a decrease in amortization of customer in-place leases from $11.6 million for the year ended December 31, 2018 to $11.3 million for the year ended December 31, 2019.
Interest Expense
Interest expense increased $13.7 million, or 32.2%, for the year ended December 31, 2019, compared to the year ended December 31, 2018. The increase in interest expense was primarily attributable to additional borrowings consisting of $155.0 million of additional term loan borrowings under the Company's credit facility on July 29, 2019 and $100.0 million of borrowings under the 2029 Term Loan Facility. Additionally, on August 30, 2019, our operating partnership issued the $150.0 million Senior Unsecured Notes in a private placement to certain accredited investors. The increase in interest expense from these additional borrowings was partially offset by lower outstanding borrowings under the Revolver.
Equity In Losses Of Unconsolidated Real Estate Ventures
Equity in losses of unconsolidated real estate ventures represents our share of losses incurred through our 25% ownership interests in the 2018 Joint Venture and the 2016 Joint Venture. During the year ended December 31, 2019, we recorded $5.0 million of equity in losses from our unconsolidated real estate ventures compared to $1.4 million of losses for the year ended December 31, 2018. This was primarily the result of incremental losses from our 2018 Joint Venture driven by real estate depreciation and amortization of customer in-place leases following the acquisition of the Initial 2018 JV Portfolio in September 2018.
Gain On Sale of Self Storage Properties
Gain on sale of self storage properties was $2.8 million for the year ended December 31, 2019, compared to $0.4 million for the year ended December 31, 2018. During the year ended December 31, 2019, we sold one self storage property to an unrelated third party for gross proceeds of $6.5 million and during the year ended December 31, 2018, we sold two self storage properties to unrelated third parties for gross proceeds of $5.5 million.
Net Income Attributable to Noncontrolling Interests
As discussed in Note 2 to the consolidated financial statements in Item 8, we allocate U.S. generally accepted accounting principles ("GAAP") income (loss) utilizing the HLBV method, in which we allocate income or loss based on the change in each unitholders' claim on the net assets of our operating partnership at period end after adjusting for any distributions or contributions made during such period.
Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to noncontrolling interests. Net income attributable to noncontrolling interests was $62.0 million for the year ended December 31, 2019, compared to $42.2 million for the year ended December 31, 2018.

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Critical Accounting Policies and Use of Estimates
Our financial statements have been prepared on the accrual basis of accounting in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates and assumptions, including those that impact our most critical accounting policies. We base our estimates and assumptions on historical experience and on various other factors that we believe are reasonable under the circumstances. Actual results may differ from these estimates. We believe the following are our most critical accounting policies.
Principles of Consolidation and Presentation of Noncontrolling Interests
Our consolidated financial statements include the accounts of our operating partnership and its controlled subsidiaries. All significant intercompany balances and transactions have been eliminated in the consolidation of entities.
The limited partner ownership interests in our operating partnership that are held by owners other than us are referred to as noncontrolling interests. Noncontrolling interests also include ownership interests in DownREIT partnerships held by entities other than our operating partnership. Noncontrolling interests in a subsidiary are generally reported as a separate component of equity in our consolidated balance sheets. In our statements of operations, the revenues, expenses and net income or loss related to noncontrolling interests in our operating partnership are included in the consolidated amounts, with net income or loss attributable to the noncontrolling interests deducted separately to arrive at the net income or loss solely attributable to us.
When we obtain an economic interest in an entity, we evaluate the entity to determine if the entity is deemed a variable interest entity ("VIE"), and if we are deemed to be the primary beneficiary, in accordance with authoritative guidance issued on the consolidation of VIEs. When an entity is not deemed to be a VIE, we consider the provisions of additional guidance to determine whether the general partner controls a limited partnership or similar entity when the limited partners have certain rights. We consolidate all entities that are VIEs and of which the Company is deemed to be the primary beneficiary.
Self Storage Properties and Customer In-Place Leases
Self storage properties are carried at historical cost less accumulated depreciation and any impairment losses. When self storage properties are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. The purchase price is allocated to the individual properties based on the fair value determined using an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates, which take into account the relative size, age, and location of the individual properties along with current and projected occupancy and relative rental rates or appraised values, if available. Tangible assets are allocated to land, buildings and related improvements, and furniture and equipment.
In allocating the purchase price for a self storage property acquisition, we determine whether the acquisition includes intangible assets. We allocate a portion of the purchase price to an intangible asset attributed to the value of customer in-place leases. Because the majority of tenant leases are on a month-to-month basis, this intangible asset represents the estimated value of the leases in effect on the acquisition date. This intangible asset is amortized to expense using the straight-line method over 12 months, the estimated average remaining rental period for the leases.

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Non-GAAP Financial Measures
FFO and Core FFO
Funds from operations, or FFO, is a widely used performance measure for real estate companies and is provided here as a supplemental measure of the Company's operating performance. The December 2018 Nareit Funds From Operations White Paper - 2018 Restatement, which we refer to as the White Paper, defines FFO as net income (as determined under GAAP), excluding: real estate depreciation and amortization, gains and losses from the sale of certain real estate assets, gains and losses from change in control, mark-to-market changes in value recognized on equity securities, impairment write-downs of certain real estate assets and impairment of investments in entities when it is directly attributable to decreases in the value of depreciable real estate held by the entity and after items to record unconsolidated partnerships and joint ventures on the same basis. Distributions declared on subordinated performance units and DownREIT subordinated performance units represent our allocation of FFO to noncontrolling interests held by subordinated performance unitholders and DownREIT subordinated performance unitholders. For purposes of calculating FFO attributable to common shareholders, OP unitholders, and LTIP unitholders, we exclude distributions declared on subordinated performance units, DownREIT subordinated performance units, preferred shares and preferred units. We define Core FFO as FFO, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our core operating performance. These further adjustments consist of acquisition costs, organizational and offering costs, gains on debt forgiveness, gains (losses) on early extinguishment of debt, and after adjustments for unconsolidated partnerships and joint ventures.
Management uses FFO and Core FFO as key performance indicators in evaluating the operations of our properties. Given the nature of our business as a real estate owner and operator, we consider FFO and Core FFO as key supplemental measures of our operating performance that are not specifically defined by GAAP. We believe that FFO and Core FFO are useful to management and investors as a starting point in measuring our operational performance because FFO and Core FFO exclude various items included in net income (loss) that do not relate to or are not indicative of our operating performance such as gains (or losses) from sales of self storage properties and depreciation, which can make periodic and peer analyses of operating performance more difficult. Our computation of FFO and Core FFO may not be comparable to FFO reported by other REITs or real estate companies.
FFO and Core FFO should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, operating income and net income (loss). FFO and Core FFO do not represent cash generated from operating activities determined in accordance with GAAP and are not a measure of liquidity or an indicator of our ability to make cash distributions. We believe that to further understand our performance, FFO and Core FFO should be compared with our reported net income (loss) and considered in addition to cash flows computed in accordance with GAAP, as presented in our consolidated financial statements.

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The following table presents a reconciliation of net income (loss) to FFO and Core FFO for the periods presented (in thousands, except per share and unit amounts):
Year Ended December 31,
2019 2018 2017
Net income $ 66,013    $ 56,326    $ 45,998   
Add (subtract):
Real estate depreciation and amortization 103,835    87,938    73,669   
Company's share of unconsolidated real estate venture real estate depreciation and amortization
19,889    10,233    7,296   
Gain on sale of self storage properties (2,814)   (391)   (5,715)  
Mark-to-market changes in value on equity securities
(610)   —    —   
Company's share of unconsolidated real estate venture loss on sale of properties
202    205    —   
Distributions to preferred shareholders and unitholders
(13,243)   (10,822)   (2,300)  
FFO attributable to subordinated performance unitholders(1)
(34,121)   (27,111)   (28,364)  
FFO attributable to common shareholders, OP unitholders, and LTIP unitholders
139,151    116,378    90,584   
Add:
Acquisition costs 1,317    663    593   
Company's share of unconsolidated real estate venture acquisition costs
—    —    22   
Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders
$ 140,468    $ 117,041    $ 91,199   
Weighted average shares and units outstanding - FFO and Core FFO:(2)
Weighted average shares outstanding - basic 58,208    53,293    44,423   
Weighted average restricted common shares outstanding 28    29    25   
Weighted average OP units outstanding
30,277    28,977    26,126   
Weighted average DownREIT OP unit equivalents outstanding
1,848    1,835    1,835   
Weighted average LTIP units outstanding
585    694    957   
Total weighted average shares and units outstanding - FFO and Core FFO
90,946    84,828    73,366   
FFO per share and unit $ 1.53    $ 1.37    $ 1.23   
Core FFO per share and unit $ 1.54    $ 1.38    $ 1.24   

(1) Amounts represent distributions declared for subordinated performance unitholders and DownREIT subordinated performance unitholders for the periods presented.
(2) NSA combines OP units and DownREIT OP units with common shares because, after the applicable lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at NSA's option, exchangeable for common shares on a one-for-one basis and DownREIT OP units are also redeemable for cash or, at NSA's option, exchangeable for OP units in our operating partnership on a one-for-one basis, subject to certain adjustments in each case. Subordinated performance units, DownREIT subordinated performance units, and LTIP units may also, under certain circumstances, be convertible into or exchangeable for common shares (or other units that are convertible into or exchangeable for common shares). See footnote(1) to the following table for additional discussion of subordinated performance units, DownREIT subordinated performance units, and LTIP units in the calculation of FFO and Core FFO per share and unit.

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The following table presents a reconciliation of earnings (loss) per share - diluted to FFO and Core FFO per share and unit for the periods presented:
Year Ended December 31,
2019 2018 2017
Earnings (loss) per share - diluted $ (0.15)   $ 0.07    $ 0.01   
Impact of the difference in weighted average number of shares(1)
0.05    (0.03)   —   
Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method(2)
0.69    0.49    0.59   
Add real estate depreciation and amortization 1.14    1.04    1.00   
Add Company's share unconsolidated venture real estate depreciation and amortization
0.22    0.12    0.10   
Subtract gain on sale of self storage properties
(0.03)   —    (0.08)  
Mark-to-market changes in value recognized on equity securities
(0.01)   —    —   
FFO attributable to subordinated performance unitholders
(0.38)   (0.32)   (0.39)  
FFO per share and unit
1.53    1.37    1.23   
Add acquisition costs and Company's share of unconsolidated real estate venture acquisition costs
0.01    0.01    0.01   
Core FFO per share and unit
$ 1.54    $ 1.38    $ 1.24   
(1) Adjustment accounts for the difference between the weighted average number of shares used to calculate diluted earnings per share and the weighted average number of shares used to calculate FFO and Core FFO per share and unit. Diluted earnings per share is calculated using the two-class method for the company's restricted common shares, the treasury stock method for certain unvested LTIP units, and includes the assumption of a hypothetical conversion of subordinated performance units and DownREIT subordinated performance units into OP units, even though such units may only be convertible into OP units (i) after a lock-out period and (ii) upon certain events or conditions. For additional information about the conversion of subordinated performance units, DownREIT subordinated performance units and LTIP units into OP units, see Note 10 to the consolidated financial statements in Item 8. The computation of weighted average shares and units for FFO and Core FFO per share and unit includes all restricted common shares and LTIP units that participate in distributions and excludes all subordinated performance units and DownREIT subordinated performance units because their effect has been accounted for through the allocation of FFO to the related unitholders based on distributions declared.
(2) Represents the effect of adjusting the numerator to consolidated net income (loss) prior to GAAP allocations for noncontrolling interests, after deducting preferred share and unit distributions, and before the application of the two-class method and treasury stock method, as described in footnote (1).
NOI
We define NOI as net income (loss), as determined under GAAP, plus general and administrative expenses, depreciation and amortization, interest expense, loss on early extinguishment of debt, equity in earnings (losses) of unconsolidated real estate ventures, acquisition costs, organizational and offering expenses, income tax expense, impairment of long-lived assets, losses on the sale of properties and non-operating expense and by subtracting management fees and other revenue, gains on sale of properties, debt forgiveness, and non-operating income. NOI is not a measure of performance calculated in accordance with GAAP.
We believe NOI is useful to investors in evaluating our operating performance because:
•NOI is one of the primary measures used by our management and our PROs to evaluate the economic productivity of our properties, including our ability to lease our properties, increase pricing and occupancy and control our property operating expenses;
•NOI is widely used in the real estate industry and the self storage industry to measure the performance and value of real estate assets without regard to various items included in net income that do not relate to or are not indicative of operating performance, such as depreciation and amortization, which can vary depending upon accounting methods, the book value of assets, and the impact of our capital structure; and
•We believe NOI helps our investors to meaningfully compare the results of our operating performance from period to period by removing the impact of our capital structure (primarily interest expense on our outstanding indebtedness) and depreciation of the cost basis of our assets from our operating results.

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There are material limitations to using a non-GAAP measure such as NOI, including the difficulty associated with comparing results among more than one company and the inability to analyze certain significant items, including depreciation and interest expense, that directly affect our net income (loss). We compensate for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with our analysis of net income (loss). NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, income from operations and net loss.
The following table presents a reconciliation of net income (loss) to NOI for the periods presented (dollars in thousands):
Year Ended December 31,
2019 2018 2017
Net income $ 66,013    $ 56,326    $ 45,998   
(Subtract) add:
Management fees and other revenue (20,735)   (12,310)   (8,061)  
General and administrative expenses 45,581    36,220    30,060   
Depreciation and amortization 105,119    89,147    75,115   
Interest expense 56,464    42,724    34,068   
Equity in losses of unconsolidated real estate venture
4,970    1,423    2,339   
Acquisition costs 1,317    663    593   
Income tax expense 1,351    818    1,159   
Gain on sale of self storage properties (2,814)   (391)   (5,715)  
Non-operating (income) expense (452)   91    58   
Net operating income
$ 256,814    $ 214,711    $ 175,614   
Our consolidated NOI shown in the table above does not include our proportionate share of NOI for our unconsolidated real estate ventures. For additional information about our 2018 Joint Venture and 2016 Joint Venture see Note 5 to the consolidated financial statements in Item 8.
EBITDA and Adjusted EBITDA
We define EBITDA as net income (loss), as determined under GAAP, plus interest expense, loss on early extinguishment of debt, income taxes, depreciation and amortization expense and the Company's share of unconsolidated real estate venture depreciation and amortization. We define Adjusted EBITDA as EBITDA plus acquisition costs, organizational and offering expenses, equity-based compensation expense, losses on sale of properties and impairment of long-lived assets, minus gains on sale of properties and debt forgiveness, and after adjustments for unconsolidated partnerships and joint ventures. These further adjustments eliminate the impact of items that we do not consider indicative of our core operating performance. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
We present EBITDA and Adjusted EBITDA because we believe they assist investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. EBITDA and Adjusted EBITDA have limitations as an analytical tool. Some of these limitations are:
•EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures, contractual commitments or working capital needs;
•EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts;
•although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements;

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•Adjusted EBITDA excludes equity-based compensation expense, which is and will remain a key element of our overall long-term incentive compensation package, although we exclude it as an expense when evaluating our ongoing operating performance for a particular period;
•EBITDA and Adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and
•other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.
We compensate for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with our analysis of net income (loss). EBITDA and Adjusted EBITDA should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, income from operations, and net income (loss).
The following table presents a reconciliation of net loss to EBITDA and Adjusted EBITDA for the periods presented (dollars in thousands):
Year Ended December 31,
2019 2018 2017
Net income $ 66,013    $ 56,326    $ 45,998   
Add:
Depreciation and amortization 105,119    89,147    75,115   
Company's share of unconsolidated real estate venture depreciation and amortization
19,889    10,233    7,296   
Income tax expense 1,351    818    1,159   
Interest expense 56,464    42,724    34,068   
EBITDA
248,836    199,248    163,636   
Add:
Acquisition costs 1,317    663    593   
Company's share of unconsolidated real estate venture acquisition costs
—    —    22   
Gain on sale of self storage properties (2,814)   (391)   (5,715)  
Company's share of unconsolidated real estate venture loss on sale of properties
202    205    —   
Equity-based compensation expense 4,527    3,837    3,764   
Adjusted EBITDA
$ 252,068    $ 203,562    $ 162,300   

Liquidity and Capital Resources
Liquidity Overview
Liquidity is the ability to meet present and future financial obligations. Our primary source of liquidity is cash flow from our operations. Additional sources are proceeds from equity and debt offerings, and debt financings including borrowings under the credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility.
Our short-term liquidity requirements consist primarily of property operating expenses, property acquisitions, capital expenditures, general and administrative expenses and principal and interest on our outstanding indebtedness. A further short-term liquidity requirement relates to distributions to our common and preferred shareholders and holders of preferred units, OP units, subordinated performance units, DownREIT OP units and DownREIT subordinated performance units. We expect to fund short-term liquidity requirements from our operating cash flow, cash on hand and borrowings under our credit facility.
Our long-term liquidity needs consist primarily of the repayment of debt, property acquisitions, and capital expenditures. We acquire properties through the use of cash, preferred units, OP units and subordinated performance units in our operating partnership or DownREIT partnerships. We expect to meet our long-term liquidity

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requirements with operating cash flow, cash on hand, secured and unsecured indebtedness, and the issuance of equity and debt securities.
The availability of credit and its related effect on the overall economy may affect our liquidity and future financing activities, both through changes in interest rates and access to financing. Currently, interest rates are low compared to historical levels and many lenders are active in the market. We believe that, as a publicly-traded REIT, we will have access to multiple sources of capital to fund our long-term liquidity requirements, including the incurrence of additional debt and the issuance of debt and additional equity securities. However, we cannot assure you that this will be the case.
Cash Flows
At December 31, 2019, we had $20.6 million in cash and cash equivalents and $3.7 million of restricted cash, an increase in cash and cash equivalents of $7.4 million and an increase in restricted cash of $0.5 million from December 31, 2018. Restricted cash primarily consists of escrowed funds deposited with financial institutions for real estate taxes, insurance, and other reserves for capital improvements in accordance with our loan agreements. The following discussion relates to changes in cash due to operating, investing, and financing activities, which are presented in our consolidated statements of cash flows included in Item 8 of this report.
Operating Activities
Cash provided by our operating activities was $196.7 million for the year ended December 31, 2019 compared to $161.8 million for the year ended December 31, 2018, an increase of $34.9 million. Our operating cash flow increased primarily due to 57 self storage properties acquired during the year ended December 31, 2018 that generated cash flow for the entire year ended December 31, 2019 and 69 self storage properties that were acquired during the year ended December 31, 2019. In addition, operating distributions from our unconsolidated real estate ventures increased by $6.4 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. These increases were partially offset by higher cash payments for general and administrative expenses and interest expense.
Investing Activities
Cash used in investing activities was $393.0 million for the year ended December 31, 2019 compared to $514.5 million for the year ended December 31, 2018. The primary uses of cash for the year ended December 31, 2019 were for our acquisition of 69 self storage properties for cash consideration of $371.1 million, the acquisition of equity securities for $12.7 million, deposits for potential acquisitions of $4.4 million, capital expenditures of $20.6 million and the acquisition of the interest in a reinsurance company and related cash flows of $6.6 million, partially offset by distributions from unconsolidated real estate ventures of $11.5 million, $6.3 million of proceeds from the sale of one self storage property and $5.4 million of proceeds from the sale of equity securities. The primary uses of cash for the year ended December 31, 2018 were for our acquisition of 57 self storage properties and an expansion project for cash consideration of $313.7 million, investments in our unconsolidated real estate ventures of $165.6 million, deposits for acquisitions of $21.0 million and capital expenditures of $19.0 million, partially offset by $5.3 million of proceeds from the sale of two self storage properties.
Capital expenditures totaled $20.6 million, $19.0 million and $14.7 million during the years ended December 31, 2019, 2018 and 2017 respectively, we generally fund post-acquisition capital additions from cash provided by operating activities.
We categorize our capital expenditures broadly into three primary categories:
•recurring capital expenditures, which represent the portion of capital expenditures that are deemed to replace the consumed portion of acquired capital assets and extend their useful life;
•value enhancing capital expenditures, which represent the portion of capital expenditures that are made to enhance the revenue and value of an asset from its original purchase condition; and
•acquisitions capital expenditures, which represent the portion of capital expenditures capitalized during the current period that were identified and underwritten prior to a property's acquisition.

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The following table presents a summary of the capital expenditures for these categories, along with a reconciliation of the total for these categories to the capital expenditures reported in the accompanying consolidated statements of cash flows for the periods presented (dollars in thousands):
Year Ended December 31,
2019 2018 2017
Recurring capital expenditures $ 8,708    $ 6,001    $ 3,495   
Value enhancing capital expenditures 4,420    3,563    2,755   
Acquisitions capital expenditures 8,305    9,356    8,953   
Total capital expenditures 21,433    18,920    15,203   
Change in accrued capital spending (839)   94    (547)  
Capital expenditures per statement of cash flows $ 20,594    $ 19,014    $ 14,656   
Financing Activities
Cash provided by our financing activities was $204.3 million for the year ended December 31, 2019 compared to $352.6 million for the year ended December 31, 2018. Our sources of financing cash flows for the year ended December 31, 2019 primarily consisted of $572.0 million of borrowings under our credit facility, $100.0 million of borrowings under our 2029 Term Loan Facility, $150.0 million of borrowings under our Senior Unsecured Notes, $70.6 million of proceeds from the issuance of common shares and $43.6 million of proceeds from the issuance of Series A Preferred Shares. Our primary uses of financing cash flows for the year ended December 31, 2019 were for principal payments on existing debt of $561.6 million (which included $556.5 million of principal repayments under the Revolver and $5.1 million of scheduled fixed rate mortgage principal payments), distributions to noncontrolling interests of $76.0 million, distributions to common shareholders of $74.5 million and distributions to preferred shareholders of $12.4 million. Our sources of financing cash flows for the year ended December 31, 2018 primarily consisted of $175.6 million of proceeds from the issuance of common shares, $672.5 million of borrowings under our credit facility, $75.0 million of borrowings under our 2023 Term Loan Facility and $75.0 million of borrowings under our 2028 Term Loan Facility. Our primary uses of financing cash flows for the year ended December 31, 2018 were for principal payments on existing debt of $507.2 million (which included $496.5 million of principal repayments under the Revolver, $5.8 million of fixed rate mortgage principal payoffs and $4.9 million of scheduled fixed rate mortgage principal payments), distributions to noncontrolling interests of $63.4 million, distributions to common shareholders of $62.2 million and distributions to preferred shareholders of $10.4 million.
Credit Facility and Term Loan Facilities
As of December 31, 2019, our credit facility provided for total borrowings of $1.275 billion, consisting of five components: (i) a Revolver which provides for a total borrowing commitment up to $500.0 million, whereby we may borrow, repay and re-borrow amounts under the Revolver, (ii) a $125.0 million Term Loan A, (iii) a $250.0 million Term Loan B, (iv) a $225.0 million Term Loan C and (v) a $175.0 million Term Loan D. The Revolver matures in January 2024; provided that we may elect to extend the maturity to July 2024 by paying an extension fee of 0.075% of the total borrowing commitment thereunder at the time of extension and meeting other customary conditions with respect to compliance. The Term Loan A matures in January 2023, the Term Loan B matures in July 2024, the Term Loan C matures in January 2025 and the Term Loan D matures in July 2026. The Revolver, Term Loan A, Term Loan B, Term Loan C and Term Loan D are not subject to any scheduled reduction or amortization payments prior to maturity. As of December 31, 2019, we have an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.750 billion.
As of December 31, 2019, $125.0 million was outstanding under the Term Loan A with an effective interest rate of 3.74%, $250.0 million was outstanding under the Term Loan B with an effective interest rate of 2.91%, $225.0 million was outstanding under the Term Loan C with an effective interest rate of 2.80%, $175.0 million was outstanding under the Term Loan D with an effective interest rate of 3.57%. As of December 31, 2019, we would have had the capacity to borrow remaining Revolver commitments of $494.3 million while remaining in compliance with the credit facility's financial covenants.
We have a 2023 Term Loan Facility that matures in June 2023 and is separate from the credit facility in an aggregate amount of $175.0 million. As of December 31, 2019 the entire amount was outstanding under the 2023

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Term Loan Facility with an effective interest rate of 2.83%. We have an expansion option under the 2023 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount of $400.0 million.
We have a 2028 Term Loan Facility that matures in December 2028 and is separate from the credit facility and 2023 Term Loan Facility in an aggregate amount of $75.0 million. As of December 31, 2019 the entire amount was outstanding under the 2028 Term Loan Facility with an effective interest rate of 4.62%. We have an expansion option under the 2028 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount up to $125.0 million.
During the year ended December 31, 2019, we entered into a credit agreement with a lender for the 2029 Term Loan Facility that matures in April 2029 and is separate from the credit facility, 2023 Term Loan Facility and 2028 Term Loan Facility in an aggregate amount of $100.0 million. As of December 31, 2019 the entire amount was outstanding under the 2029 Term Loan Facility with an effective interest rate of 4.27%.
For a summary of our financial covenants and additional detail regarding our credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility, please see Note 8 to the consolidated financial statements in Item 8.
2029 And 2031 Senior Unsecured Notes
As discussed in Note 8 to the consolidated financial statements in Item 8, on August 30, 2019, our operating partnership issued $100.0 million of 3.98% senior unsecured notes due August 30, 2029 and $50.0 million of 4.08% senior unsecured notes due August 30, 2031 in a private placement to certain accredited investors.
Contractual Obligations
The following table summarizes information contained elsewhere in this Annual Report on Form 10-K regarding payments due under contractual obligations and commitments on an undiscounted basis as of December 31, 2019 (dollars in thousands):
Year Ending December 31,
2020 2021 2022 2023 2024 Thereafter Total
Debt financings:
Principal(1)
$ 40,647    $ 7,603    $ 4,205    $ 377,049    $ 271,964    $ 837,792    $ 1,539,260   
Interest(2)
54,498    53,571    53,381    44,468    36,474    89,512    331,904   
Real estate leasehold interests
1,419    1,444    1,459    1,464    1,470    36,728    43,984   
Office lease
286    387    381    346    353    691    2,444   
Total $ 96,850    $ 63,005    $ 59,426    $ 423,327    $ 310,261    $ 964,723    $ 1,917,592   
(1)Includes scheduled principal and maturity payments related to our debt financings.
(2)Interest is calculated until the maturity date (without regard to any extension that may be elected by the Company) based on the outstanding principal balance and the effective interest rate as of December 31, 2019.
Equity Transactions
Issuance of Common Shares and Series A Preferred Shares
During the year ended December 31, 2019, we sold 2,375,000 of our common shares and 1,785,680 of our Series A Preferred Shares through at the market offerings. The common shares were sold at an average offering price of $30.06 per share, resulting in net proceeds to us of approximately $70.6 million after deducting compensation payable by us to such agents and offering expenses. The Series A Preferred Shares were sold at an average offering price of $24.84 per share, resulting in net proceeds to us of approximately $43.6 million after deducting compensation payable by us to such agents and offering expenses.
During the year ended December 31, 2019, after receiving notices of redemption from certain OP unitholders, we elected to issue 581,001 common shares to such holders in exchange for 581,001 OP units in satisfaction of the operating partnership's redemption obligations.

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During the year ended December 31, 2019, the Company issued 37,770 common shares in exchange for $1.3 million of principal payment reimbursements received during the year ended December 31, 2019 related to mortgages assumed in connection with the acquisition of self storage properties from PROs during the year ended December 31, 2014.
Issuance of OP Equity
In connection with the 69 properties acquired during the year ended December 31, 2019, $51.8 million of OP equity was issued (consisting of 350,319 OP units, 340,702 Series A-1 preferred units and 1,178,400 subordinated performance units).
During the year ended December 31, 2019, the Company issued 863,148 OP units upon conversion of 913,680 subordinated performance units and 13,475 DownREIT OP units upon conversion of 15,377 DownREIT subordinated performance units as further described under "Subordinated Performance Units and DownREIT Subordinated Performance Units" in Note 3 to the consolidated financial statements in Item 8.
Dividends and Distributions
During the year ended December 31, 2019, the Company paid $74.5 million of distributions to common shareholders, $12.4 million of distributions to preferred shareholders and distributed $76.0 million to noncontrolling interests.
On February 20, 2020, our board of trustees declared a cash dividend and distribution, respectively, of $0.33 per common share and OP unit to shareholders and OP unitholders of record as of March 13, 2020. On February 20, 2020, our board of trustees also declared cash distributions of $0.375 per Series A Preferred Share and Series A-1 preferred unit to shareholders and unitholders of record as of March 13, 2020. In addition, we expect to declare a cash distribution in the first quarter of 2020 to our subordinated performance unitholders of record as of March 13, 2020. Such dividends and distributions are expected to be paid on March 31, 2020.
Cash Distributions from our Operating Partnership
Under the LP Agreement of our operating partnership, to the extent that we, as the general partner of our operating partnership, determine to make distributions to the partners of our operating partnership out of the operating cash flow or capital transaction proceeds generated by a real property portfolio managed by one of our PROs, the holders of the series of subordinated performance units that relate to such portfolio are entitled to share in such distributions. Under the LP Agreement of our operating partnership, operating cash flow with respect to a portfolio of properties managed by one of our PROs is generally an amount determined by us, as general partner of our operating partnership, equal to the excess of property revenues over property related expenses from that portfolio. In general, property revenue from the portfolio includes:
(i)all receipts, including rents and other operating revenues;
(ii)any incentive, financing, break-up and other fees paid to us by third parties;
(iii)amounts released from previously set aside reserves; and
(iv)any other amounts received by us, which we allocate to the particular portfolio of properties.
In general, property-related expenses include all direct expenses related to the operation of the properties in that portfolio, including real property taxes, insurance, property-level general and administrative expenses, employee costs, utilities, property marketing expense, property maintenance and property reserves and other expenses incurred at the property level. In addition, other expenses incurred by our operating partnership will also be allocated by us, as general partner, to the property portfolio and will be included in the property-related expenses of that portfolio. Examples of such other expenses include:
(i)corporate-level general and administrative expenses;
(ii)out-of-pocket costs, expenses and fees of our operating partnership, whether or not capitalized;
(iii)the costs and expenses of organizing and operating our operating partnership;
(iv)amounts paid or due in respect of any loan or other indebtedness of our operating partnership during such period;

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(v)extraordinary expenses of our operating partnership not previously or otherwise deducted under item (ii) above;
(vi)any third-party costs and expenses associated with identifying, analyzing, and presenting a proposed property to us and/or our operating partnership; and
(vii)reserves to meet anticipated operating expenditures, debt service or other liabilities, as determined by us.
To the extent that we, as the general partner of our operating partnership, determine to make distributions to the partners of our operating partnership out of the operating cash flow of a real property portfolio managed by one of our PROs, operating cash flow from a property portfolio is required to be allocated to OP unitholders and to the holders of series of subordinated performance units that relate to such property portfolio as follows:
First, an amount is allocated to OP unitholders in order to provide OP unitholders (together with any prior allocations of capital transaction proceeds) with a cumulative preferred allocation on the unreturned capital contributions attributed to the OP units in respect of such property portfolio. The preferred allocation for all of our existing portfolios is 6%. As of December 31, 2019, our operating partnership had an aggregate of $1,632.2 million of unreturned capital contributions with respect to common shareholders and OP unitholders, with respect to the various property portfolios.
Second, an amount is allocated to the holders of the series of subordinated performance units relating to such property portfolio in order to provide such holders with an allocation (together with prior distributions of capital transaction proceeds) on their unreturned capital contributions. Although the subordinated allocation for the subordinated performance units is non-cumulative from period to period, if the operating cash flow from a property portfolio related to a series of subordinated performance units is sufficient, in the judgment of the general partner (with the approval of a majority of our independent trustees), to fund distributions to the holders of such series of subordinated performance units, but we, as the general partner of our operating partnership, decline to make distributions to such holders, the amount available but not paid as distributions will be added to the subordinated allocation corresponding to such series of subordinated performance units. The subordinated allocation for the outstanding subordinated performance units is 6%. As of December 31, 2019, an aggregate of $152.8 million of unreturned capital contributions has been allocated to the various series of subordinated performance units.
Thereafter, any additional operating cash flow is allocated to OP unitholders and the applicable series of subordinated performance units equally.
Following the allocation described above, we as the general partner of our operating partnership, will generally cause our operating partnership to distribute the amounts allocated to the relevant series of subordinated performance units to the holders of such series of subordinated performance units. We, as the general partner, may cause our operating partnership to distribute the amounts allocated to OP unitholders or may cause our operating partnership to retain such amounts to be used by our operating partnership for any purpose. Any operating cash flow that is attributable to amounts retained by our operating partnership pursuant to the preceding sentence will generally be available to be allocated as an additional capital contribution to the various property portfolios.
The foregoing description of the allocation of operating cash flow between the OP unitholders and subordinated performance unitholders is used for purposes of determining distributions to holders of subordinated performance units but does not necessarily represent the operating cash flow that will be distributed to OP unitholders (or paid as dividends to holders of our common shares). Any distribution of operating cash flow allocated to the OP unitholders will be made at our discretion (and paid as dividends to holders of our common shares at the discretion of our board of trustees).
Under the LP Agreement of our operating partnership, capital transactions are transactions that are outside the ordinary course of our operating partnership's business, involve the sale, exchange, other disposition, or refinancing of any property, and are designated as capital transactions by us, as the general partner. To the extent the general partner determines to distribute capital transaction proceeds, the proceeds from capital transactions involving a particular property portfolio are required to be allocated to OP unitholders and to the series of subordinated performance units that relate to such property portfolio as follows:
First, an amount determined by us, as the general partner, of such capital transaction proceeds is allocated to OP unitholders in order to provide OP unitholders (together with any prior allocations of operating cash flow) with a cumulative preferred allocation on the unreturned capital contributions attributed to the OP unitholders in respect of

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such property portfolio that relate to such capital transaction plus an additional amount equal to such unreturned capital contributions.
Second, an amount determined by us, as the general partner, is allocated to the holders of the series of subordinated performance units relating to such property portfolio in order to provide such holders with a non-cumulative subordinated allocation on the unreturned capital contributions made by such holders in respect of such property portfolio that relate to such capital transaction plus an additional amount equal to such unreturned capital contributions.
The preferred allocation and subordinated allocation with respect to capital transaction proceeds for each portfolio is equal to the preferred allocation and subordinated allocation for distributions of operating cash flow with respect to that portfolio.
Thereafter, any additional capital transaction proceeds are allocated to OP unitholders and the applicable series of subordinated performance units equally.
Following the allocation described above, we, as the general partner of our operating partnership, will generally cause our operating partnership to distribute the amounts allocated to the relevant series of subordinated performance units to the holders of such series of subordinated performance units. We, as general partner of our operating partnership, may cause our operating partnership to distribute the amounts allocated to the OP unitholders or may cause our operating partnership to retain such amounts to be used by our operating partnership for any purpose. Any capital transaction proceeds that are attributable to amounts retained by our operating partnership pursuant to the preceding sentence will generally be available to be allocated as an additional capital contribution to the various property portfolios.
The foregoing allocation of capital transaction proceeds between the OP unitholders and subordinated performance unitholders is used for purposes of determining distributions to holders of subordinated performance units but does not necessarily represent the capital transaction proceeds that will be distributed to OP unitholders (or paid as dividends to holders of our common shares). Any distribution of capital transaction proceeds allocated to the OP unitholders will be made at our discretion (and paid as dividends to holders of our common shares at the discretion of our board of trustees).
Our OP units are redeemable for cash or, at our option exchangeable on a one-for-one basis into common shares after an agreed period of time and certain other conditions. Our subordinated performance units are only convertible into OP units following a two year lock-out period and then (i) at the holder's election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at our election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations.
Notwithstanding the two-year lock out period on conversions of subordinated performance units into OP units, if such subordinated performance units were convertible into OP units as of December 31, 2019, each subordinated performance unit would on average hypothetically convert into 1.48 OP units, or into an aggregate of approximately 22.8 million OP units. These amounts are based on historical financial information for the trailing twelve months ended December 31, 2019. The hypothetical conversion is calculated by dividing the average cash available for distribution, or CAD, per subordinated performance unit by 110% of the CAD per OP unit over the same period. We anticipate that as our CAD grows over time, the conversion ratio will also grow, including to levels that may exceed this amount. The actual number of OP units into which such subordinated performance units will become convertible may vary significantly and will depend upon the applicable conversion penalty and the actual CAD to the OP units and the actual CAD to the converted subordinated performance units in the one-year period ending prior to conversion. We have also granted registration rights to those persons who will be eligible to receive common shares issuable upon exchange of OP units issued in our formation transactions and certain contribution transactions.

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Allocation of Capital Contributions
We, as the general partner of our operating partnership, in our discretion, have the right to increase or decrease, as appropriate, the amount of capital contributions allocated to our operating partnership in general and to each series of subordinated performance units to reflect capital expenditures made by our operating partnership in respect of each portfolio, the sale or refinancing of all or a portion of the properties comprising the portfolio, the distribution of capital transaction proceeds by our operating partnership, the retention by our operating partnership of cash for working capital purposes and other events impacting the amount of capital contributions allocated to the holders. In addition, to avoid conflicts of interests, any decision by us to increase or decrease allocations of capital contributions must also be approved by a majority of our independent trustees.
Off-Balance Sheet Arrangements
Except as disclosed in the notes to our financial statements, as of December 31, 2019, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purposes entities, which typically are established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Further, except as disclosed in the notes to our financial statements, as of December 31, 2019, we have not guaranteed any obligations of unconsolidated entities nor made any commitments to provide funding to any such entities that creates any material exposure to any financing, liquidity, market or credit risk.
Segment 
We manage our business as one reportable segment consisting of investments in self storage properties located in the United States. Although we operate in several markets, these operations have been aggregated into one reportable segment based on the similar economic characteristics among all markets.
Seasonality 
The self storage business is subject to minor seasonal fluctuations. A greater portion of revenues and profits are realized from May through September. Historically, our highest level of occupancy has typically been in July, while our lowest level of occupancy has typically been in February. Results for any quarter may not be indicative of the results that may be achieved for the full fiscal year.
Inflation
Inflation in the United States has been relatively low in recent years and did not have a material impact on our results of operations for the years ended December 31, 2019, 2018 and 2017. Although the impact of inflation has been relatively insignificant in recent years, it remains a factor in the U.S. economy and may increase the cost of acquiring or replacing self storage properties and related improvements, as well as real estate property taxes, employee salaries, wages and benefits, utilities, and other expenses. Because our tenant leases are month-to-month, we may be able to rapidly adjust our rental rates to minimize the adverse impact of any inflation which could mitigate our exposure to increases in costs and expenses resulting from inflation.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk
Market risk refers to the risk of loss from adverse changes in market prices and interest rates. Our future income, cash flows, and fair values of financial instruments are dependent upon prevailing market interest rates. The primary market risk to which we believe we are exposed is interest rate risk. Interest rate risk is highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations, and other factors beyond our control. We use interest rate swaps to moderate our exposure to interest rate risk by effectively converting the interest on variable rate debt to a fixed rate. We make limited use of other derivative financial instruments and we do not use them for trading or other speculative purposes.
As of December 31, 2019, all our debt subject to variable interest rates was fixed pursuant to interest rate swap agreements.
When we have variable interest rate debt, we determine the interest rate risk amounts by considering the impact of hypothetical interest rates on our financial instruments. These analyses do not consider the effect of any change in overall economic activity that could occur. Further, in the event of a change, we may take actions to further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, these analyses would assume no changes in our financial structure.

55

Item 8. Financial Statements and Supplementary Data
The independent registered public accounting firm's reports, consolidated financial statements and schedule listed in the accompanying index are filed as part of this report and incorporated herein by this reference. See "Index to Financial Statements" on page F-1 of this Annual Report on Form 10-K.
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Disclosure Controls and Procedures
A review and evaluation was performed by our management, including our Chief Executive Officer (the "CEO") and Chief Financial Officer (the "CFO"), of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of the end of the period covered by this Annual Report on Form 10-K. Based on that review and evaluation, the CEO and CFO have concluded that our current disclosure controls and procedures, as designed and implemented, were effective.
Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in our periodic reports.
Management's Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, our principal executive and principal financial officers and effected by our board of trustees, audit committee, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP and includes those policies and procedures that:
•pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company;
•provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and trustees; and
•provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. 
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2019. In making this assessment, our management used criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 Framework).
Based on this assessment, our management believes that, as of December 31, 2019, our internal control over financial reporting was effective based on those criteria.
The Company’s independent registered public accounting firm has issued an attestation report on the Company’s internal control over financial reporting.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

56

Item 9B. Other Information
None.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information regarding our trustees, executive officers and certain other matters required by Item 401 of Regulation S-K is incorporated herein by reference to our definitive proxy statement relating to our annual meeting of shareholders (the "Proxy Statement"), to be filed with the SEC within 120 days after December 31, 2019.
The information regarding compliance with Section 16(a) of the Exchange Act required by Item 405 of Regulation S-K is incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
The information regarding our Code of Business Conduct and Ethics required by Item 406 of Regulation S-K is incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
The information regarding certain matters pertaining to our corporate governance required by Item 407(c)(3), (d)(4) and (d)(5) of Regulation S-K is incorporated by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
Item 11. Executive Compensation
The information regarding executive compensation and other compensation related matters required by Items 402 and 407(e)(4) and (e)(5) of Regulation S-K is incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The tables on equity compensation plan information and beneficial ownership of the Company required by Items 201(d) and 403 of Regulation S-K are incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information regarding transactions with related persons, promoters and certain control persons and trustee independence required by Items 404 and 407(a) of Regulation S-K is incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
Item 14. Principal Accounting Fees and Services
The information concerning principal accounting fees and services and the Audit Committee's pre-approval policies and procedures required by Item 14 is incorporated herein by reference to the Proxy Statement to be filed with the SEC within 120 days after December 31, 2019.
PART IV
Item 15. Exhibits, Financial Statement Schedules
(a)(1) The financial statements listed in the Index to Financial Statements on Page F-1 of this report are filed as part of this report and incorporated herein by reference.
(a)(2) The financial statement schedule listed in the Index to Financial Statements on Page F-1 of this report is filed as part of this report and incorporated herein by reference.
(a)(3) The Exhibit Index is incorporated herein by reference.

INDEX TO EXHIBITS
Exhibit Number Exhibit Description

57
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3.1
3.2
3.3
3.4
3.5
4.1
4.2

58
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Second Amended and Restated Credit Agreement dated as of July 29, 2019 by and among NSA OP, LP, as Borrower, the lenders from time to time party hereto, and KeyBank National Association, as Administrative Agent, and joined in for certain purposes by certain Subsidiaries of the Borrower and National Storage Affiliates Trust, with Keybanc Capital Markets Inc., and PNC Capital Markets LLC, as Co-Bookrunners and Co-Lead Arrangers, PNC Bank, National Association, as Syndication Agent, U.S. Bank National Association and BMO Capital Markets Corp. as Co-Lead Arrangers and Co-Documentation Agents, Wells Fargo Securities, LLC as Co-Lead Arranger, Wells Fargo Bank, National Association, as Co-Documentation Agent, and CitiBank, N.A., as Co-Lead Arranger and Co-Documentation Agent for the Revolving Credit Facility (Exhibit 10.1 to the Quarterly Report on Form 10-Q, filed with the SEC on November 1, 2019, is incorporated herein by this reference)

59
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60
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101.INS* XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH* Inline XBRL Taxonomy Extension Schema
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB* Inline XBRL Taxonomy Extension Label Linkbase
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase
104* Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
* Filed herewith.

Item 16. Form 10-K Summary
None.

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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

National Storage Affiliates Trust
By: /s/ TAMARA D. FISCHER
Tamara D. Fischer
president and chief executive officer
(principal executive officer)
Date: February 26, 2020


POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Tamara D. Fischer and Brandon S. Togashi, and each of them, with full power to act without the other, such person's true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign this Form 10-K and any and all amendments thereto, and to file the same, with exhibits and schedules thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or desirable to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.


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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned and in the capacities and on the dates indicated.
Signature Title Date
National Storage Affiliates Trust
/s/ TAMARA D. FISCHER trustee, president and chief executive officer February 26, 2020
Tamara D. Fischer (principal executive officer)
/s/ BRANDON S. TOGASHI chief financial officer February 26, 2020
Brandon S. Togashi (principal accounting and financial officer)
/s/ ARLEN D. NORDHAGEN executive chairman of the board of trustees February 26, 2020
Arlen D. Nordhagen
/s/ GEORGE L. CHAPMAN trustee February 26, 2020
George L. Chapman
/s/ PAUL W. HYLBERT, JR. trustee February 26, 2020
Paul W. Hylbert, Jr.
/s/ CHAD L. MEISINGER trustee February 26, 2020
Chad L. Meisinger
/s/ STEVEN G. OSGOOD trustee February 26, 2020
Steven G. Osgood
/s/ DOMINIC M. PALAZZO trustee February 26, 2020
Dominic M. Palazzo
/s/ REBECCA L. STEINFORT trustee February 26, 2020
Rebecca L. Steinfort
/s/ MARK VAN MOURICK trustee February 26, 2020
Mark Van Mourick
/s/ J. TIMOTHY WARREN trustee February 26, 2020
J. Timothy Warren



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NATIONAL STORAGE AFFILIATES TRUST
INDEX TO FINANCIAL STATEMENTS
Page
Financial Statements:
Reports of Independent Registered Public Accounting Firm
F-1
Consolidated Balance Sheets as of December 31, 2019 and 2018
F-5
Consolidated Statements of Operations for the Years Ended December 31, 2019, 2018 and 2017
F-6
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2019, 2018 and 2017
F-7
Consolidated Statements of Changes in Equity for the Years Ended December 31, 2019, 2018 and 2017
F-8
Consolidated Statements of Cash Flows for the Years Ended December 31, 2019, 2018 and 2017
Notes to the Consolidated Financial Statements
Financial Statement Schedule:
Schedule III - Real Estate and Accumulated Depreciation
All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.


F-1
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Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees
National Storage Affiliates Trust:

Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of National Storage Affiliates Trust and subsidiaries (the Company) as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive income (loss), changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2019, and the related notes, and the financial statement schedule, Schedule III – Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 26, 2020 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgment. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Evaluation of purchase price allocation for self storage property acquisitions
As discussed in Notes 2 and 6 to the consolidated financial statements, during 2019, the Company acquired $447.8 million of self storage properties that were recorded as asset acquisitions. The purchase price in an asset acquisition is allocated to the tangible and intangible assets acquired and liabilities assumed based on their relative fair value. Assets acquired and liabilities assumed primarily comprise land, buildings and related improvements, customer in-place leases, furniture and equipment, and assumed mortgage loans.
We identified the evaluation of purchase price allocation of self storage property acquisitions as a critical audit matter. This is due to the subjective and complex auditor judgment that was required to evaluate the Company’s estimated fair value of land, buildings, and improvements. In particular, there was a high
F-2
Table of Contents
degree of auditor judgment required to evaluate the comparable sales information and costs that would be incurred to replace building and improvement assets.
The primary procedures we performed to address this critical audit matter included the following. We tested certain internal controls over the Company’s process to estimate fair value, including developing estimated fair values of land, buildings, and improvements. We compared and evaluated estimated fair value of land, buildings, and improvements against purchase price allocations for similar land, buildings, and improvements acquired by the Company. With the assistance of valuation professionals with specialized skills and knowledge, we evaluated the estimated fair value of land by comparing the Company’s estimates to independently developed ranges using publicly available market data of recent land sales. We evaluated the Company’s estimated costs of replacing buildings and improvements. We compared the estimated costs to market data, including appraisal guides used to estimate the depreciated value of similar self storage structures.

/s/ KPMG LLP
We have served as the Company’s auditor since 2013.
Denver, Colorado
February 26, 2020
F-3
Table of Contents
Report of Independent Registered Public Accounting Firm
To the Shareholders and Board of Trustees
National Storage Affiliates Trust:
Opinion on Internal Control Over Financial Reporting
We have audited National Storage Affiliates Trust and subsidiaries’ (the Company) internal control over financial reporting as of December 31, 2019 based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive income (loss), changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2019, and the related notes, and the financial statement schedule, Schedule III - Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and our report dated February 26, 2020 expressed an unqualified opinion on those consolidated financial statements.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG LLP
Denver, Colorado
February 26, 2020

F-4
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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except per share amounts)
December 31,
2019 2018
ASSETS
Real estate
Self storage properties $ 3,091,719    $ 2,637,723   
Less accumulated depreciation (337,822)   (246,261)  
Self storage properties, net 2,753,897    2,391,462   
Cash and cash equivalents 20,558    13,181   
Restricted cash 3,718    3,182   
Debt issuance costs, net 3,264    1,260   
Investment in unconsolidated real estate ventures 214,061    245,125   
Other assets, net 65,441    75,053   
Operating lease right-of-use assets 23,306    —   
Total assets $ 3,084,245    $ 2,729,263   
LIABILITIES AND EQUITY
Liabilities
Debt financing $ 1,534,047    $ 1,278,102   
Accounts payable and accrued liabilities 57,909    33,130   
Operating lease liabilities 24,665    —   
Deferred revenue 15,523    15,732   
Total liabilities 1,632,144    1,326,964   
Commitments and contingencies (Note 12)
Equity
Preferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 8,727,119 and 6,900,000 issued and outstanding at December 31, 2019 and 2018, at liquidation preference
218,178    172,500   
Common shares of beneficial interest, par value $0.01 per share. 250,000,000 authorized, 59,659,108 and 56,654,009 shares issued and outstanding at December 31, 2019 and 2018, respectively
597    567   
Additional paid-in capital 905,763    844,276   
Distributions in excess of earnings (197,075)   (114,122)  
Accumulated other comprehensive (loss) income (7,833)   13,618   
Total shareholders' equity 919,630    916,839   
Noncontrolling interests 532,471    485,460   
Total equity 1,452,101    1,402,299   
Total liabilities and equity $ 3,084,245    $ 2,729,263   


See notes to consolidated financial statements.

F-5
Table of Contents
NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)

Year Ended December 31,
2019 2018 2017
REVENUE
Rental revenue $ 354,859    $ 308,403    $ 251,814   
Other property-related revenue 12,302    10,183    8,255   
Management fees and other revenue 20,735    12,310    8,061   
Total revenue 387,896    330,896    268,130   
OPERATING EXPENSES
Property operating expenses 110,347    103,875    84,455   
General and administrative expenses 45,581    36,220    30,060   
Depreciation and amortization 105,119    89,147    75,115   
Total operating expenses 261,047    229,242    189,630   
OTHER (EXPENSE) INCOME
Interest expense (56,464)   (42,724)   (34,068)  
Equity in losses of unconsolidated real estate ventures
(4,970)   (1,423)   (2,339)  
Acquisition costs (1,317)   (663)   (593)  
Non-operating income (expense) 452    (91)   (58)  
Gain on sale of self storage properties 2,814    391    5,715   
Other expense (59,485)   (44,510)   (31,343)  
Income before income taxes 67,364    57,144    47,157   
Income tax expense (1,351)   (818)   (1,159)  
Net income 66,013    56,326    45,998   
Net income attributable to noncontrolling interests
(62,030)   (42,217)   (43,037)  
Net income attributable to National Storage Affiliates Trust
3,983    14,109    2,961   
Distributions to preferred shareholders
(12,390)   (10,350)   (2,300)  
Net (loss) income attributable to common shareholders
$ (8,407)   $ 3,759    $ 661   
Earnings (loss) per share - basic and diluted $ (0.15)   $ 0.07    $ 0.01   
Weighted average shares outstanding - basic and diluted
58,208    53,293    44,423   


See notes to consolidated financial statements.

F-6
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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(dollars in thousands)
Year Ended December 31,
2019 2018 2017
Net income $ 66,013    $ 56,326    $ 45,998   
Other comprehensive income (loss)
Unrealized (loss) gain on derivative contracts
(29,941)   3,598    1,935   
Reclassification of other comprehensive (income) loss to interest expense
(3,337)   (1,817)   2,308   
Other comprehensive (loss) income
(33,278)   1,781    4,243   
Comprehensive income 32,735    58,107    50,241   
Comprehensive income attributable to noncontrolling interests
(49,977)   (43,244)   (44,697)  
Comprehensive (loss) income attributable to National Storage Affiliates Trust
$ (17,242)   $ 14,863    $ 5,544   


See notes to consolidated financial statements.

F-7
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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(dollars in thousands, except share amounts)
Accumulated
Additional Distributions Other
Preferred Shares Common Shares Paid-in in Excess of Comprehensive Noncontrolling Total
Number Amount Number Amount Capital Earnings (Loss) Income Interests Equity
Balances, December 31, 2016 —    $ —    43,110,362    $ 431    $ 576,365    $ (8,719)   $ 9,025    $ 401,966    $ 979,068   
Issuance of preferred shares, net of offering costs
6,900,000    172,500    —    —    (5,934)   —    —    —    166,566   
OP equity recorded in connection with property acquisitions:
OP units and subordinated performance units, net of offering costs
—    —    —    —    —    —    —    29,900    29,900   
LTIP units —    —    —    —    —    —    —    854    854   
Issuance of subordinated performance units
—    —    —    —    —    —    —    7,000    7,000   
Redemptions of OP units —    —    1,409,715    14    18,389    —    289    (18,692)   —   
Issuance of common shares, net of offering costs
—    —    5,750,000    58    140,203    —    —    —    140,261   
Issuance of common shares, share based compensation plans
—    —    6,862    —    —    —    —    —    —   
Effect of changes in ownership for consolidated entities
—    —    —    —    (17,749)   —    385    17,364    —   
Issuance of OP units —    —    —    —    —    —    —    1,262    1,262   
Equity-based compensation expense
—    —    —    —    244    —    —    3,520    3,764   
Issuance of LTIP units for acquisition expenses
—    —    —    —    —    —    —    15    15   
Issuance of restricted common shares
—    —    16,525    —    —    —    —    —    —   
Vesting and forfeitures of restricted common shares
—    —    (8,530)   —    (51)   —    —    —    (51)  
Reduction in receivables from partners of OP
—    —    —    —    —    —    —    812    812   
Preferred share dividends —    —    —    —    —    (2,300)   —    —    (2,300)  
Common share dividends —    —    —    —    —    (47,671)   —    —    (47,671)  
Distributions to noncontrolling interests
—    —    —    —    —    —    —    (58,234)   (58,234)  
See notes to consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
(dollars in thousands, except share amounts)

Accumulated
Additional Distributions Other
Preferred Shares Common Shares Paid-in in Excess of Comprehensive Noncontrolling Total
Number Amount Number Amount Capital Earnings (Loss) Income Interests Equity
Other comprehensive income —    —    —    —    —    —    2,583    1,660    4,243   
Net income —    —    —    —    —    2,961    —    43,037    45,998   
Balances, December 31, 2017 6,900,000    172,500    50,284,934    503    711,467    (55,729)   12,282    430,464    1,271,487   
OP equity recorded in connection with property acquisitions:
Series A-1 preferred units, OP units and subordinated performance units, net of offering costs
—    —    —    —    —    —    —    27,962    27,962   
Redemptions of OP units
—    —    462,778    5    5,904    —    172    (6,081)   —   
Issuance of common shares, net of offering costs
—    —    5,900,000    59    175,557    —    —    —    175,616   
Effect of changes in ownership for consolidated entities
—    —    —    —    (48,830)   —    410    48,420    —   
Issuance of OP units
—    —    —    —    —    —    —    1,236    1,236   
Equity-based compensation expense
—    —    —    —    253    —    —    3,584    3,837   
Issuance of restricted common shares
—    —    12,311    —    —    —    —    —    —   
Vesting and forfeitures of restricted common shares, net
—    —    (6,014)   —    (75)   —    —    —    (75)  
Reduction in receivables from partners of the operating partnership
—    —    —    —    —    —    —    642    642   
Preferred share dividends
—    —    —    —    —    (10,350)   —    —    (10,350)  
Common share dividends
—    —    —    —    —    (62,152)   —    —    (62,152)  
Distributions to noncontrolling interests
—    —    —    —    —    —    —    (64,011)   (64,011)  
Other comprehensive income
—    —    —    —    —    —    754    1,027    1,781   
Net income
—    —    —    —    —    14,109    —    42,217    56,326   
Balances, December 31, 2018 6,900,000    172,500    56,654,009    567    844,276    (114,122)   13,618    485,460    1,402,299   
Issuance of preferred shares, net of offering costs
1,785,680    44,642    —    —    (1,018)   —    —    —    43,624   
OP equity issued for property acquisitions:
See notes to consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED)
(dollars in thousands, except share amounts)

Accumulated
Additional Distributions Other
Preferred Shares Common Shares Paid-in in Excess of Comprehensive Noncontrolling Total
Number Amount Number Amount Capital Earnings (Loss) Income Interests Equity
Series A-1 preferred units, OP units and subordinated performance units, net of offering costs
—    —    —    —    —    —    —    51,321    51,321   
Redemptions of Series A-1 preferred units
41,439    1,036    —    —    20    —    —    (1,056)   —   
Redemptions of OP units
—    —    581,001    6    4,794    —    (41)   (4,759)   —   
Issuance of common shares, net of offering costs
—    —    2,412,770    24    71,867    —    —    —    71,891   
Effect of changes in ownership for consolidated entities
—    —    —    —    (14,429)   —    (185)   14,614    —   
Issuance of OP units
—    —    —    —    —    —    —    8,540    8,540   
Equity-based compensation expense
—    —    —    —    322    —    —    4,205    4,527   
Issuance of LTIP units for acquisition expenses
—    —    —    —    —    —    —    179    179   
Issuance of restricted common shares
—    —    18,218    —    —    —    —    —    —   
Vesting and forfeitures of restricted common shares, net
—    —    (6,890)   —    (69)   —    —    —    (69)  
Reduction in receivables from partners of the operating partnership
—    —    —    —    —    —    —    505    505   
Preferred share dividends
—    —    —    —    —    (12,390)   —    —    (12,390)  
Common share dividends
—    —    —    —    —    (74,546)   —    —    (74,546)  
Distributions to noncontrolling interests
—    —    —    —    —    —    —    (76,515)   (76,515)  
Other comprehensive loss
—    —    —    —    —    —    (21,225)   (12,053)   (33,278)  
Net income
—    —    —    —    —    3,983    —    62,030    66,013   
Balances, December 31, 2019 8,727,119    $ 218,178    59,659,108    $ 597    $ 905,763    $ (197,075)   $ (7,833)   $ 532,471    $ 1,452,101   


See notes to consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
Year Ended December 31,
2019 2018 2017
OPERATING ACTIVITIES
Net income $ 66,013    $ 56,326    $ 45,998   
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
105,119    89,147    75,115   
Amortization of debt issuance costs
2,913    2,569    2,175   
Amortization of debt discount and premium, net
(1,427)   (1,469)   (1,570)  
Gain on sale of self storage properties
(2,814)   (391)   (5,715)  
Mark-to-market changes in value on equity securities
(610)   —    —   
Equity-based compensation expense
4,527    3,837    3,764   
Equity in losses of unconsolidated real estate ventures
4,970    1,423    2,339   
Distributions from unconsolidated real estate ventures
14,551    8,187    5,093   
Change in assets and liabilities, net of effects of self storage property acquisitions:
Other assets 110    (5,713)   (2,398)  
Accounts payable and accrued liabilities 5,617    6,597    1,200   
Deferred revenue (2,318)   1,283    (1,713)  
Net Cash Provided by Operating Activities
196,651    161,796    124,288   
INVESTING ACTIVITIES
Acquisition of self storage properties
(371,096)   (313,712)   (391,619)  
Capital expenditures
(20,594)   (19,014)   (14,656)  
Investments in and advances to unconsolidated real estate ventures
—    (165,642)   (15,289)  
Distributions from unconsolidated real estate ventures
11,543    —    250   
Deposits and advances for self storage property and other acquisitions
(4,438)   (20,977)   (4,923)  
Expenditures for corporate furniture, equipment and other
(862)   (403)   (588)  
Acquisition of equity securities
(12,674)   —    —   
Proceeds from sale of equity securities
5,356    —    —   
Acquisition of interest in reinsurance company and related cash flows
(6,600)   —    —   
Net proceeds from sale of self storage properties
6,335    5,259    17,534   
Net Cash Used In Investing Activities
(393,030)   (514,489)   (409,291)  
FINANCING ACTIVITIES
Proceeds from issuance of common shares
70,637    175,616    140,261   
Proceeds from issuance of preferred shares
43,624    —    166,566   
Proceeds from issuance of subordinated performance units
—    —    7,000   
Borrowings under debt financings
822,000    822,500    760,900   
Receipts for OP unit subscriptions
1,271    1,211    1,150   
Principal payments under debt financings
(561,628)   (507,239)   (679,104)  
Payment of dividends to common shareholders
(74,546)   (62,152)   (47,671)  
Payment of dividends to preferred shareholders
(12,390)   (10,350)   (2,300)  
Distributions to noncontrolling interests
(76,010)   (63,350)   (57,314)  
See notes to consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(dollars in thousands)



Year Ended December 31,
2019 2018 2017
Debt issuance costs
(8,487)   (2,860)   (2,381)  
Equity offering costs
(179)   (727)   (1,034)  
Net Cash Provided by Financing Activities
204,292    352,649    286,073   
Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
7,913    (44)   1,070   
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of year 16,363    16,407    15,337   
End of year $ 24,276    $ 16,363    $ 16,407   


Supplemental Cash Flow Information
Cash paid for interest $ 52,666    $ 40,475    $ 32,951   
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Consideration exchanged in property acquisitions:
Issuance of OP units and subordinated performance units
$ 51,826    $ 28,063    $ 30,327   
Deposits on acquisitions applied to purchase price
20,977    5,050    350   
LTIP units vesting upon acquisition of properties
—    —    854   
Assumption of mortgages payable
—    7,581    —   
Other net liabilities assumed
2,403    2,167    3,616   
Issuance of OP unit subscription liability through reduced distributions
1,253    1,236    1,262   
Settlement of acquisition receivables through reduced distributions
505    642    812   
Increase in OP unit subscription liability through reduced distributions
—    19    108   
Change in payables for offering costs (321)   626    600   
Settlement of offering expenses from equity issuance proceeds
1,241    575    12,299   
Operating lease right-of-use assets on balance sheet due to implementation of leases standard
23,306    —    —   
Operating lease liabilities on balance sheet due to implementation of leases standard
24,665    —    —   


See notes to consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS





1. ORGANIZATION AND NATURE OF OPERATIONS
National Storage Affiliates Trust was organized in the state of Maryland on May 16, 2013 and is a fully integrated, self-administered and self-managed real estate investment trust focused on the self storage sector. As used herein, "NSA," the "Company," "we," "our," and "us" refers to National Storage Affiliates Trust and its consolidated subsidiaries, except where the context indicates otherwise. The Company has elected and believes that it has qualified to be taxed as a real estate investment trust for U.S. federal income tax purposes ("REIT") commencing with its taxable year ended December 31, 2015.
Through its controlling interest as the sole general partner of NSA OP, LP (its "operating partnership"), a Delaware limited partnership formed on February 13, 2013, the Company is focused on the ownership, operation, and acquisition of self storage properties located within the top 100 MSAs in the United States. Pursuant to the Agreement of Limited Partnership (as amended, the "LP Agreement") of its operating partnership, the Company's operating partnership is authorized to issue preferred units, Class A Units ("OP units"), different series of Class B Units ("subordinated performance units"), and Long-Term Incentive Plan Units ("LTIP units"). The Company also owns certain of its self storage properties through other consolidated limited partnership subsidiaries of its operating partnership, which the Company refers to as "DownREIT partnerships." The DownREIT partnerships issue equity ownership interests that are intended to be economically equivalent to the Company's OP units ("DownREIT OP units") and subordinated performance units ("DownREIT subordinated performance units").
The Company owned 567 consolidated self storage properties in 29 states and Puerto Rico with approximately 34.5 million rentable square feet (unaudited) in approximately 275,000 storage units as of December 31, 2019. These properties are managed with local operational focus and expertise by the Company and its participating regional operators ("PROs"). These PROs are SecurCare Self Storage, Inc. and its controlled affiliates ("SecurCare"), Kevin Howard Real Estate Inc., d/b/a Northwest Self Storage and its controlled affiliates ("Northwest"), Optivest Properties LLC and its controlled affiliates ("Optivest"), Guardian Storage Centers LLC and its controlled affiliates ("Guardian"), Move It Self Storage and its controlled affiliates ("Move It"), Arizona Mini Storage Management Company d/b/a Storage Solutions and its controlled affiliates ("Storage Solutions"), Hide-Away Storage Services, Inc. and its controlled affiliates ("Hide-Away"), an affiliate of Shader Brothers Corporation d/b/a Personal Mini Storage ("Personal Mini"), Southern Storage Management Systems, Inc. d/b/a Southern Self Storage ("Southern") and affiliates of Investment Real Estate Management, LLC d/b/a Moove In Self Storage ("Moove In").
As of December 31, 2019, the Company also managed through its property management platform an additional portfolio of 175 properties owned by the Company's unconsolidated real estate ventures. These properties contain approximately 12.6 million rentable square feet, configured in approximately 103,000 storage units and located across 21 states. The Company owns a 25% equity interest in each of its unconsolidated real estate ventures.
As of December 31, 2019, in total, the Company operated and held ownership interests in 742 self storage properties located across 35 states and Puerto Rico with approximately 47.1 million rentable square feet in approximately 378,000 storage units.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements are presented on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles ("GAAP").

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Principles of Consolidation
The Company's consolidated financial statements include the accounts of its operating partnership and its controlled subsidiaries. All significant intercompany balances and transactions have been eliminated in the consolidation of entities.
When the Company obtains an economic interest in an entity, the Company evaluates the entity to determine if the entity is deemed a variable interest entity ("VIE"), and if the Company is deemed to be the primary beneficiary, in accordance with authoritative guidance issued on the consolidation of VIEs. When an entity is not deemed to be a VIE, the Company considers the provisions of additional guidance to determine whether the general partner controls a limited partnership or similar entity when the limited partners have certain rights. The Company consolidates all entities that are VIEs and of which the Company is deemed to be the primary beneficiary. The Company has determined that its operating partnership is a VIE. The sole significant asset of National Storage Affiliates Trust is its investment in its operating partnership, and consequently, substantially all of the Company's assets and liabilities represent those assets and liabilities of its operating partnership.
As of December 31, 2019, the Company's operating partnership was the primary beneficiary of, and therefore consolidated, 21 DownREIT partnerships that are considered VIEs, which owned 34 self storage properties. The net book value of the real estate owned by these VIEs was $233.1 million and $240.4 million as of December 31, 2019 and December 31, 2018, respectively. For certain DownREIT partnerships which are subject to fixed rate mortgages payable, the carrying value of such fixed rate mortgages payable held by these VIEs was $136.4 million and $138.4 million as of December 31, 2019 and December 31, 2018, respectively. The creditors of the consolidated VIEs do not have recourse to the Company's general credit.
Noncontrolling Interests
All of the limited partner equity interests ("OP equity") in its operating partnership not held by the Company are reflected as noncontrolling interests. Noncontrolling interests also include ownership interests in DownREIT partnerships held by entities other than the Company's operating partnership. In the consolidated statements of operations, the Company allocates net income (loss) attributable to noncontrolling interests to arrive at net income (loss) attributable to National Storage Affiliates Trust.
For transactions that result in changes to the Company's ownership interest in its operating partnership, the carrying amount of noncontrolling interests is adjusted to reflect such changes. The difference between the fair value of the consideration received or paid and the amount by which the noncontrolling interests is adjusted is reflected as an adjustment to additional paid-in capital on the consolidated balance sheets.
Self Storage Properties
Self storage properties are carried at historical cost less accumulated depreciation and any impairment losses. Major replacements and betterments, which improve or extend the life of an asset, are capitalized. Expenditures for ordinary repairs and maintenance are expensed as incurred and are included in property operating expenses. Estimated depreciable lives of self storage properties are determined by considering the age and other indicators about the condition of the assets at the respective dates of acquisition, resulting in a range of estimated useful lives for assets within each category. All self storage property assets are depreciated using the straight-line method. Buildings and improvements are depreciated over estimated useful lives primarily between seven and 40 years; furniture and equipment are depreciated over estimated useful lives primarily between three and 10 years.
When a self storage property is acquired, the purchase price of the acquired self storage property is allocated to land, buildings and improvements, furniture and equipment, customer in-place leases, assumed real estate leasehold interests, and other assets acquired and liabilities assumed, based on the estimated fair value of each component. When a portfolio of self storage properties is acquired, the purchase price is allocated to the individual self storage properties based on the fair value determined using an income approach with appropriate risk-adjusted capitalization rates, which take into account the relative size, age and location of the individual self storage properties.
Cash and Cash Equivalents
The Company considers all highly-liquid investments purchased with original maturities of three months or less to be cash equivalents. From time to time, the Company maintains cash balances in financial institutions in excess of federally insured limits. The Company has never experienced a loss that resulted from exceeding federally insured limits.

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Restricted Cash
The Company's restricted cash consists of escrowed funds deposited with financial institutions for real estate taxes, insurance and other reserves for capital improvements in accordance with the Company's loan agreements.
Customer In-place Leases
In allocating the purchase price for a self storage property acquisition, the Company determines whether the acquisition includes intangible assets. The Company allocates a portion of the purchase price to an intangible asset attributed to the value of customer in-place leases. This intangible asset is amortized to expense using the straight-line method over 12 months, the estimated average rental period for the leases. Substantially all of the leases in place at acquired properties are at market rates, as the leases are month-to-month contracts.
Impairment of Long-Lived Assets
The Company evaluates long-lived assets for impairment when events and circumstances indicate that there may be impairment. When events or changes in circumstances indicate that the Company's long-lived assets may not be recoverable, the carrying value of these long-lived assets is compared to the undiscounted future net operating cash flows, plus a terminal value attributable to the assets. If an asset's carrying value is not considered recoverable, an impairment loss is recorded to the extent the net carrying value of the asset exceeds the fair value. For the periods presented, no assets were determined to be impaired under this policy.
Costs of Raising Capital
Commissions, legal fees and other costs that are directly associated with equity offerings are capitalized as deferred offering costs, pending a determination of the success of the offering. Deferred offering costs related to successful offerings are charged to additional paid-in capital within equity in the period it is determined that the offering was successful.
Debt issuance costs are amortized over the estimated life of the related debt using the straight-line method, which approximates the effective interest rate method. Amortization of debt issuance costs is included in interest expense in the accompanying statements of operations.
Revenue Recognition
Rental revenue
Rental revenue consists of space rentals and related fees. Management has determined that all of the Company's leases are operating leases. Substantially all leases may be terminated on a month-to-month basis and rental income is recognized ratably over the lease term using the straight-line method. Rents received in advance are deferred and recognized on a straight-line basis over the related lease term associated with the prepayment. Promotional discounts and other incentives are recognized as a reduction to rental income over the applicable lease term.
Other property-related revenue
Other property-related revenue primarily consists of ancillary revenues such as tenant insurance and/or tenant warranty protection-related access fees and sales of storage supplies which are recognized in the period earned.
The Company and certain of the Company’s PROs have tenant insurance- and/or tenant warranty protection plan-related arrangements with insurance companies and the Company’s tenants. During the years ended December 31, 2019, 2018 and 2017, the Company recognized $9.1 million, $7.5 million and $6.0 million, respectively, of tenant insurance and tenant warranty protection plan revenues.
The Company sells boxes, packing supplies, locks and other retail merchandise at its properties. During the years ended December 31, 2019, 2018 and 2017, the Company recognized retail sales of $1.7 million, $1.5 million and $1.3 million, respectively.
Management fees and other revenue
Management fees and other revenue consist of property management fees, platform fees, call center fees, acquisition fees, and a portion of tenant warranty protection or tenant insurance proceeds that the Company earns for managing and operating its unconsolidated real estate ventures.
With respect to both the 2018 Joint Venture and the 2016 Joint Venture, the Company provides supervisory and administrative property management services, centralized call center services, and technology platform and revenue

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management services to the properties in the unconsolidated real estate ventures. The property management fees are equal to 6% of monthly gross revenues and net sales revenues from the assets of the unconsolidated real estate ventures, and the platform fees are equal to $1,250 per month per unconsolidated real estate venture property. With respect to the 2016 Joint Venture only, the call center fees are equal to 1% of each of monthly gross revenues and net sales revenues from the 2016 Joint Venture properties. During the years ended December 31, 2019, 2018 and 2017, the Company recognized property management fees, call center fees and platform fees of $12.8 million, $7.8 million and $4.8 million, respectively.
For acquisition fees, the Company provides sourcing, underwriting and administration services to the unconsolidated real estate ventures. The 2016 Joint Venture paid the Company a $4.1 million acquisition fee equal to 0.65% of the gross capitalization (including debt and equity) of the original 66-property 2016 Joint Venture portfolio (the "Initial 2016 JV Portfolio") in 2016, at the time of the Initial 2016 JV Portfolio acquisition. The 2018 Joint Venture paid the Company a $4.0 million acquisition fee related to the initial acquisition of properties by the 2018 Joint Venture (the "Initial 2018 JV Portfolio") during the year ended December 31, 2018, at the time of the Initial 2018 JV Portfolio acquisition. These fees are refundable to the unconsolidated real estate ventures, on a prorated basis, if the Company is removed as the managing member during the initial four year life of the unconsolidated real estate ventures and as such, the Company's performance obligation for these acquisition fees are satisfied over a four year period. As of December 31, 2019 and 2018, the Company had deferred revenue related to the acquisition fees of $2.8 million and $4.6 million, respectively.
The Company also earns acquisition fees for properties acquired by the unconsolidated real estate ventures subsequent to the Initial 2016 JV Portfolio and the Initial 2018 JV Portfolio. These fees are based on a percentage of the gross capitalization of the acquired assets determined by the members of the 2016 Joint Venture and the 2018 Joint Venture, and are generally earned when the unconsolidated real estate ventures obtain title and control of an acquired property. During the years ended December 31, 2019, 2018 and 2017, the Company recognized acquisition fees of $1.8 million, $1.6 million and $1.5 million, respectively.
An affiliate of the Company facilitates tenant warranty protection or tenant insurance programs for tenants of the properties in the unconsolidated real estate ventures in exchange for 50% of all proceeds from such programs at each unconsolidated real estate venture property. During the years ended December 31, 2019, 2018 and 2017, the Company recognized $4.7 million, $2.4 million and $1.9 million, respectively, of revenue related to these activities.
Advertising Costs
The Company incurs advertising costs primarily attributable to internet, directory and other advertising. Advertising costs are included in property operating expenses in the accompanying statements of operations. These costs are expensed in the period in which the cost is incurred. The Company incurred advertising costs of $5.2 million, $4.1 million and $3.7 million for the years ended December 31, 2019, 2018 and 2017, respectively.
Acquisition Costs
The Company incurs title, legal and consulting fees, and other costs associated with the completion of acquisitions. During the year ended December 31, 2017, the Company adopted Accounting Standards Update ("ASU") 2017-01 and as a result, the Company's self storage property acquisitions during the years ended December 31, 2019 and 2018 were accounted for as asset acquisitions, and accordingly, acquisition costs directly related to the self storage property acquisitions were capitalized as part of the basis of the acquired properties. Indirect acquisition costs remain included in acquisition costs in the accompanying statements of operations in the period in which they were incurred. Prior to the Company's adoption of ASU 2017-01, direct and indirect costs were included in acquisition costs in the accompanying statements of operations in the period in which they were incurred.

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Income Taxes
The Company has elected and believes it has qualified to be taxed as a REIT under sections 856 through 860 of the U.S. Internal Revenue Code (the "Code") commencing with the taxable year ended December 31, 2015. To qualify as a REIT, among other things, the Company is required to distribute at least 90% of its REIT taxable income to its shareholders and meet certain tests regarding the nature of its income and assets. As a REIT, the Company is not subject to federal income tax on the earnings distributed currently to its shareholders that it derives from its REIT qualifying activities. If the Company fails to qualify as a REIT in any taxable year, and is unable to avail itself of certain provisions set forth in the Code, all of the Company's taxable income would be subject to federal and state income taxes at regular corporate rates.
The Company will not be required to make distributions with respect to income derived from the activities conducted through subsidiaries that the Company elects to treat as taxable REIT subsidiaries ("TRS") for federal income tax purposes. Certain activities that the Company undertakes must be conducted by a TRS, such as performing non-customary services for its customers, facilitating sales by PROs of tenant insurance and holding assets that the Company is not permitted to hold directly. A TRS is subject to federal and state income taxes.
On June 25, 2014, the Company formed NSA TRS, LLC ("NSA TRS"), a Delaware limited liability company. The Company has elected to treat NSA TRS as a TRS, and consequently, NSA TRS is subject to U.S. federal and state corporate income taxes. Deferred tax assets and liabilities are recognized to the extent of any differences between the financial reporting and tax bases of assets and liabilities. No material deferred tax assets and liabilities were recorded as of December 31, 2019 and 2018.
The Company did not have any unrecognized tax benefits related to uncertain tax positions as of December 31, 2019 and 2018. Future amounts of accrued interest and penalties, if any, related to uncertain tax positions will be recorded as a component of income tax expense. The Company does not expect that the amount of unrecognized tax benefits will change significantly in the next 12 months.
The Company's material taxing jurisdiction is the U.S. federal jurisdiction; the 2016 tax year is the earliest period that remains open to examination by these taxing jurisdictions.
Earnings per Share
Basic earnings per share is calculated based on the weighted average number of the Company's common shares of beneficial interest, $0.01 par value per share ("common shares"), outstanding during the period. Diluted earnings per share is calculated by further adjusting for the dilutive impact using the treasury stock method for any share options and unvested share equivalents outstanding during the period and the if-converted method for any convertible securities outstanding during the period.
As more fully described below under "–Allocation of Net Income (Loss)", the Company allocates GAAP income (loss) utilizing the hypothetical liquidation at book value ("HLBV") method, which could result in net income (or net loss) attributable to National Storage Affiliates Trust during a period when the Company reports consolidated net loss (or net income), or net income (or net loss) attributable to National Storage Affiliates Trust in excess of the Company's consolidated net income (or net loss). The computations of basic and diluted earnings (loss) per share may be materially affected by these disproportionate income (loss) allocations, resulting in volatile fluctuations of basic and diluted earnings (loss) per share.
Equity-Based Awards
The measurement and recognition of compensation cost for all equity-based awards granted to officers, employees and consultants is based on estimated fair values. Compensation cost is recognized on a straight-line basis over the requisite service periods of each award with non-graded vesting. For awards granted which contain a graded vesting schedule and the only condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line basis over the requisite service period as if the award was, in substance, a single award. For awards granted for which vesting is subject to a performance condition, compensation cost is recognized over the requisite service period if and when the Company concludes it is probable that the performance condition will be achieved.
The estimated fair value of all equity-based awards issued to PROs and their affiliates in connection with self storage property acquisitions is included in the cost of the respective acquisitions. The estimated fair value of such

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awards is measured at the date the self storage properties are acquired, as this date represents satisfaction of the performance condition and coincides with the award vesting.
Derivative Financial Instruments
The Company carries all derivative financial instruments on the balance sheet at fair value. Fair value of derivatives is determined by reference to observable prices that are based on inputs not quoted on active markets, but corroborated by market data. The accounting for changes in the fair value of a derivative instrument depends on whether the derivative has been designated and qualifies as part of a hedging relationship. The Company's use of derivative instruments has been limited to interest rate swap and cap agreements. The fair values of derivative instruments are included in other assets and accounts payable and accrued liabilities in the accompanying balance sheets. For derivative instruments not designated as cash flow hedges, the unrealized gains and losses are included in interest expense in the accompanying statements of operations. For derivatives designated as cash flow hedges, the effective portion of the changes in the fair value of the derivatives is initially reported in accumulated other comprehensive income (loss) in the Company's balance sheets and subsequently reclassified into earnings when the hedged transaction affects earnings.
The valuation of interest rate swap and cap agreements is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate forward curves. The Company may enter into derivative contracts that are intended to economically hedge certain of its risk, even though hedge accounting does not apply or the Company elects not to apply hedge accounting.
Fair Value Measurements
When measuring fair value of financial instruments that are required to be recorded or disclosed at fair value, the Company uses a three-tier measurement hierarchy which prioritizes the inputs used to calculate fair value. These tiers include Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
Investments in Unconsolidated Real Estate Ventures
The Company’s investments in its unconsolidated real estate ventures are recorded under the equity method of accounting in the accompanying consolidated financial statements. Under the equity method, the Company’s investments in unconsolidated real estate ventures are stated at cost and adjusted for the Company’s share of net earnings or losses and reduced by distributions. Equity in earnings (losses) is recognized based on the Company’s ownership interest in the earnings (losses) of the unconsolidated real estate ventures. The Company follows the "nature of the distribution approach" for classification of distributions from its unconsolidated real estate ventures in its consolidated statements of cash flows. Under this approach, distributions are reported on the basis of the nature of the activity or activities that generated the distributions as either a return on investment, which are classified as operating cash flows, or a return of investment (e.g., proceeds from the unconsolidated real estate ventures' sale of assets) which are reported as investing cash flows.
Segment Reporting
The Company manages its business as one reportable segment consisting of investments in self storage properties located in the United States. Although the Company operates in several markets, these operations have been aggregated into one reportable segment based on the similar economic characteristics among all markets.

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Allocation of Net Income (Loss)
The distribution rights and priorities set forth in the operating partnership's LP Agreement differ from what is reflected by the underlying percentage ownership interests of the operating partnership's unitholders. Accordingly, the Company allocates GAAP income (loss) utilizing the HLBV method, in which the Company allocates income or loss based on the change in each unitholders’ claim on the net assets of its operating partnership at period end after adjusting for any distributions or contributions made during such period. The HLBV method is commonly applied to equity investments where cash distribution percentages vary at different points in time and are not directly linked to an equity holder’s ownership percentage.
The HLBV method is a balance sheet-focused approach to income (loss) allocation. A calculation is prepared at each balance sheet date to determine the amount that unitholders would receive if the operating partnership were to liquidate all of its assets (at GAAP net book value) and distribute the resulting proceeds to its creditors and unitholders based on the contractually defined liquidation priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is used to derive each unitholder's share of the income (loss) for the period. Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to unitholders as compared to their respective ownership percentage in the operating partnership, and net income (loss) attributable to National Storage Affiliates Trust could be more or less net income than actual cash distributions received and more or less income or loss than what may be received in the event of an actual liquidation. Additionally, the HLBV method could result in net income (or net loss) attributable to National Storage Affiliates Trust during a period when the Company reports consolidated net loss (or net income), or net income (or net loss) attributable to National Storage Affiliates Trust in excess of the Company's consolidated net income (or net loss). The computations of basic and diluted earnings (loss) per share may be materially affected by these disproportionate income (loss) allocations, resulting in volatile fluctuations of basic and diluted earnings (loss) per share.
Other Comprehensive Income (Loss)
The Company has cash flow hedge derivative instruments that are measured at fair value with unrealized gains or losses recognized in other comprehensive income (loss) with a corresponding adjustment to accumulated other comprehensive income (loss) within equity, as discussed further in Note 14. Under the HLBV method of allocating income (loss) discussed above, a calculation is prepared at each balance sheet date by applying the HLBV method including, and excluding, the assets and liabilities resulting from the Company's cash flow hedge derivative instruments to determine comprehensive income (loss) attributable to National Storage Affiliates Trust. As a result of the distribution rights and priorities set forth in the operating partnership's LP Agreement, in any given period, other comprehensive income (loss) may be allocated disproportionately to unitholders as compared to their respective ownership percentage in the operating partnership and as compared to their respective allocation of net income (loss).
Gain on sale of self storage properties
The Company recognizes gains from disposition of facilities only upon closing in accordance with the guidance on sales of nonfinancial assets. Profit on real estate sold is recognized upon closing when all, or substantially all, of the promised consideration has been received and is nonrefundable and the Company has transferred control of the facilities to the purchaser.
Goodwill
Goodwill represents the costs of business acquisitions in excess of the fair value of identifiable net assets acquired. The Company evaluates goodwill for potential impairment annually, or whenever impairment indicators are present. The Company determined that there was no impairment to goodwill during the years ended December 31, 2019 and 2018.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

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Recent Accounting Pronouncements
In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU 2016-02, Leases, which amends the existing guidance for accounting for leases, including requiring lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases and lessees to recognize most leases on-balance sheet as lease liabilities with corresponding right-of-use assets. In July 2018, the FASB issued ASU 2018-11, Leases - Targeted Improvements, which allows entities the option to apply the new standard at adoption date with a cumulative-effect adjustment in the period of adoption.
The Company adopted ASU 2016-02 and ASU 2018-11 effective January 1, 2019 and applied it to leases that were in place on the effective date. The Company elected the practical expedients which permit the Company to combine lease and nonlease components and to not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, and (iii) any initial direct costs for any existing leases as of the effective date. Results for reporting periods beginning January 1, 2019 are presented under ASU 2016-02 and ASU 2018-11. As a result, beginning on January 1, 2019, activity related to uncollectible accounts are recognized as a current-period adjustment within revenue. For periods prior to January 1, 2019, such amounts were previously included in operating expenses. The adoption of the lease standard did not result in a cumulative catch-up adjustment to opening equity. See Note 13 for additional detail about the Company's non-cancelable leasehold interest agreements where the Company is a lessee.
3. SHAREHOLDERS' EQUITY AND NONCONTROLLING INTERESTS
Shareholders' Equity
At the Market ("ATM") Program
On February 27, 2019, the Company entered into a sales agreement with certain sales agents, pursuant to which the Company may sell from time to time up to $250.0 million of the Company's common shares and 6.000% Series A Preferred Shares in sales deemed to be "at the market" offerings. The sales agreement contemplates that, in addition to the issuance and sale by the Company of offered shares to or through the sale agents, the Company may enter into separate forward sale agreements with any forward purchaser. Forward sale agreements, if any, will include only the Company's common shares and will not include any Series A Preferred Shares. If the Company enters into a forward sale agreement with any forward purchaser, such forward purchaser will attempt to borrow from third parties and sell, through the related agent, acting as sales agent for such forward purchaser (each, a "forward seller"), offered shares, in an amount equal to the offered shares subject to such forward sale agreement, to hedge such forward purchaser’s exposure under such forward sale agreement. The Company may offer the common shares and Series A Preferred Shares through the agents, as the Company's sales agents, or, as applicable, as forward seller, or directly to the agents or forward sellers, acting as principals, by means of, among others, ordinary brokers’ transactions on the NYSE or otherwise at market prices prevailing at the time of sale or at negotiated prices.
During the year ended December 31, 2019, the Company sold 2,375,000 of its common shares through the ATM program at an average offering price of $30.06 per share, resulting in net proceeds to the Company of approximately $70.6 million, after deducting compensation payable by the Company to such agents and offering expenses. In addition, during the year ended December 31, 2019, the Company sold 1,785,680 of its Series A Preferred Shares through the ATM program at an average offering price of $24.84 per share, resulting in net proceeds to the Company of approximately $43.6 million, after deducting compensation payable by the Company to such agents and offering expenses.
Common Share Offerings
On July 13, 2018, the Company closed a follow-on offering of 5,900,000 of its common shares at an offering price of $29.86 per share. The Company received aggregate net proceeds from the offering of approximately $175.6 million after deducting expenses associated with the offering.
On December 11, 2017, the Company closed a follow-on public offering of 5,750,000 of its common shares, which included 750,000 common shares sold upon the exercise in full by the underwriters of their option to purchase additional common shares, at a public offering price of $25.50 per share. The Company received aggregate net proceeds from the offering of approximately $140.3 million after deducting the underwriting discount and additional expenses associated with the offering. 

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Series A Preferred Share Offering
On October 11, 2017, the Company completed an underwritten public offering of 6,900,000 of its 6.000% Series A Preferred Shares, which included 900,000 Series A Preferred Shares sold upon the exercise in full by the underwriters of their option to purchase additional Series A Preferred Shares, resulting in net proceeds to the Company of approximately $166.6 million, after deducting the underwriting discount and the Company's other offering expenses. Dividends on the Series A Preferred Shares, which are payable quarterly in arrears, are cumulative from the date of original issuance in the amount of $1.50 per share each year. The Series A Preferred Shares rank senior to the Company's common shares with respect to rights and rights upon our liquidation, dissolution or winding up. Generally, the Series A Preferred Shares become redeemable by the Company beginning in October 2022 for a cash redemption price of $25.00 per share, plus accrued but unpaid dividends.
Noncontrolling Interests
All of the OP equity in the Company's operating partnership not held by the Company is reflected as noncontrolling interests. Noncontrolling interests also include ownership interests in DownREIT partnerships held by entities other than the Company's operating partnership. NSA is the general partner of its operating partnership and is authorized to cause its operating partnership to issue additional partner interests, including OP units and subordinated performance units, at such prices and on such other terms as it determines in its sole discretion.
As of December 31, 2019 and 2018, units reflecting noncontrolling interests consisted of the following:
December 31,
2019 2018
Series A-1 preferred units 642,982    343,719   
OP units 30,188,305    28,874,103   
Subordinated performance units 11,014,195    10,749,475   
LTIP units 743,566    931,671   
DownREIT units
DownREIT OP units 1,848,261    1,834,786   
DownREIT subordinated performance units 4,371,622    4,386,999   
Total 48,808,931    47,120,753   
Series A-1 Preferred Units
The 6.000% Series A-1 Cumulative Redeemable Preferred Units ("Series A-1 preferred units") rank senior to OP units and subordinated performance units in the Company's operating partnership with respect to distributions and liquidation. The Series A-1 preferred units have a stated value of $25.00 per unit and receive distributions at an annual rate of 6.000%. These distributions are cumulative. The Series A-1 preferred units are redeemable at the option of the holder after the first anniversary of the date of issuance, which redemption obligations may be satisfied at the Company’s option in cash in an amount equal to the market value of an equivalent number of the Company's 6.000% Series A Preferred Shares or the issuance of 6.000% Series A Preferred Shares on a one-for-one basis, subject to adjustments. Generally, the Series A-1 preferred units become redeemable by the Company beginning ten years after the initial issuance of each Series A-1 preferred unit at a stated value of $25.00 per unit, plus accrued but unpaid distributions. The increase in Series A-1 preferred units outstanding from December 31, 2018 to December 31, 2019 was due to the issuance of Series A-1 preferred units in connection with the acquisition of self storage properties partially offset by the redemption of 41,439 Series A-1 preferred units for Series A preferred shares.
OP Units and DownREIT OP units
OP units in the Company's operating partnership are redeemable for cash or, at the Company's option, exchangeable for common shares on a one-for-one basis, and DownREIT OP units are redeemable for cash or, at the Company's option, exchangeable for OP units in its operating partnership on a one-for-one basis, subject to certain adjustments in each case. The holders of OP units are generally not entitled to elect redemption until one year after the issuance of the OP units. The holders of DownREIT OP units are generally not entitled to elect redemption until five years after the date of the contributor's initial contribution.

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The increase in OP Units outstanding from December 31, 2018 to December 31, 2019 was due to the issuance of 863,148 OP units related to the voluntary conversions of 913,680 subordinated performance units (as discussed further below), the issuance of 350,319 OP units in connection with the acquisition of self storage properties, 396,224 LTIP units which were converted into OP units and the issuance of 285,512 OP units in connection with the acquisition of an interest in a tenant reinsurance company and related cash flows, as discussed in Note 11, partially offset by the redemption of 581,001 OP units for common shares.
The increase in DownREIT OP units outstanding from December 31, 2018 to December 31, 2019 was due to the issuance of 13,475 DownREIT OP units related to the conversion of 15,377 DownREIT subordinated performance units (as discussed further below).
Subordinated Performance Units and DownREIT Subordinated Performance Units
Subordinated performance units may also, under certain circumstances, be convertible into OP units which are exchangeable for common shares as described above, and DownREIT subordinated performance units may, under certain circumstances, be exchangeable for subordinated performance units on a one-for-one basis. Subordinated performance units are only convertible into OP units after a two year lock-out period and then generally (i) at the holder’s election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at the Company's election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations. The holders of DownREIT subordinated performance units are generally not entitled to elect redemption until at least five years after the date of the contributor's initial contribution.
Following such lock-out period, a holder of subordinated performance units in the Company's operating partnership may elect a voluntary conversion one time each year on or prior to December 1st to convert a pre-determined portion of such subordinated performance units into OP units in the Company's operating partnership, with such conversion effective January 1st of the following year, with each subordinated performance unit being converted into the number of OP units determined by dividing the average cash available for distribution, or CAD, per unit on the series of specific subordinated performance units over the one-year period prior to conversion by 110% of the CAD per unit on the OP units determined over the same period. CAD per unit on the series of specific subordinated performance units and OP units is determined by the Company based generally upon the application of the provisions of the LP Agreement applicable to the distributions of operating cash flow and capital transactions proceeds.
The increase in subordinated performance units outstanding from December 31, 2018 to December 31, 2019 was due to the issuance of 1,178,400 subordinated performance units for co-investment by certain of the Company's PROs in connection with the acquisition of self storage properties partially offset by the voluntary conversion of 913,680 subordinated performance units into 863,148 OP units.
The decrease in DownREIT subordinated performance units outstanding from December 31, 2018 to December 31, 2019 was due to the conversion of 15,377 DownREIT subordinated performance units into 13,475 DownREIT OP units.
LTIP Units
LTIP units are a special class of partnership interest in the Company's operating partnership that allow the holder to participate in the ordinary and liquidating distributions received by holders of the OP units (subject to the achievement of specified levels of profitability by the Company's operating partnership or the achievement of certain events). LTIP units may also, under certain circumstances, be convertible into OP units on a one-for-one basis, which are then exchangeable for common shares as described above. LTIP units do not have full parity with OP units with respect to liquidating distributions and may not receive ordinary distributions until such parity is reached pursuant to the terms of the LP Agreement. If such parity is reached under the LP Agreement, upon vesting, vested LTIP units may be converted into an equal number of OP units, and thereafter have all the rights of OP units, including redemption rights. See Note 9 for additional information about the Company's LTIP Units.
The decrease in LTIP units outstanding from December 31, 2018 to December 31, 2019 was due to the conversion of 396,224 LTIP units into OP units partially offset by the issuance of 208,119 compensatory LTIP units to employees, trustees and consultants, net of forfeitures.

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4. SELF STORAGE PROPERTIES
Self storage properties are summarized as follows (dollars in thousands):
December 31,
2019 2018
Land $ 649,938    $ 583,455   
Buildings and improvements 2,435,171    2,048,281   
Furniture and equipment 6,610    5,987   
Total self storage properties 3,091,719    2,637,723   
Less accumulated depreciation (337,822)   (246,261)  
Self storage properties, net $ 2,753,897    $ 2,391,462   

Depreciation expense related to self storage properties amounted to $92.2 million, $76.3 million and $60.5 million for the years ended December 31, 2019, 2018 and 2017, respectively.
5. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES
2018 Joint Venture
As of December 31, 2019, the Company's unconsolidated real estate venture, formed in September 2018 with an affiliate of Heitman America Real Estate REIT LLC (the "2018 Joint Venture"), in which the Company has a 25% ownership interest, owned and operated a portfolio of 103 self storage properties containing approximately 7.7 million rentable square feet, configured in over 63,000 storage units and located across 17 states.
2016 Joint Venture
As of December 31, 2019, the Company's unconsolidated real estate venture, formed in September 2016 with a state pension fund advised by Heitman Capital Management LLC (the "2016 Joint Venture"), in which the Company has a 25% ownership interest, owned and operated a portfolio of 72 properties containing approximately 4.9 million rentable square feet, configured in approximately 40,000 storage units and located across 13 states.
During the year ended December 31, 2019, the 2016 Joint Venture sold to the Company one self storage property for a gross sales price of $4.1 million. See Note 11 for additional details about the Company's acquisition of the self storage property from the 2016 Joint Venture.
The Company's investments in the 2018 Joint Venture and 2016 Joint Venture are accounted for using the equity method of accounting and are included in investment in unconsolidated real estate ventures in the Company’s consolidated balance sheets. The Company’s earnings from its investments in the 2018 Joint Venture and 2016 Joint Venture are presented in equity in earnings (losses) of unconsolidated real estate ventures on the Company’s consolidated statements of operations.

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The following table presents the combined condensed financial position of the Company's unconsolidated real estate ventures as of December 31, 2019 and December 31, 2018 (in thousands):
December 31,
2019 2018
ASSETS
Self storage properties, net $ 1,835,235    $ 1,894,412   
Other assets 22,413    50,915   
Total assets $ 1,857,648    $ 1,945,327   
LIABILITIES AND EQUITY
Debt financing $ 989,182    $ 956,357   
Other liabilities 20,487    16,516   
Equity 847,979    972,454   
Total liabilities and equity $ 1,857,648    $ 1,945,327   
The following table presents the combined condensed operating information of the Company's unconsolidated real estate ventures for the years ended December 31, 2019 and 2018 and the period ended December 31, 2017 (in thousands):
Year Ended December 31,
2019 2018 2017
Total revenue $ 162,827    $ 94,507    $ 54,747   
Property operating expenses 49,845    30,229    18,463   
Net operating income 112,982    64,278    36,284   
Supervisory, administrative and other expenses
(10,818)   (6,397)   (3,921)  
Depreciation and amortization (79,556)   (40,930)   (29,192)  
Interest expense (39,936)   (20,718)   (11,389)  
Loss on sale of self storage properties (806)   (820)   —   
Acquisition and other expenses (1,971)   (1,188)   (1,146)  
Net loss $ (20,105)   $ (5,775)   $ (9,364)  
The combined condensed operating information in the table above only includes information for the 2018 Joint Venture following the acquisition of the Initial 2018 JV Portfolio in September 2018.
6. SELF STORAGE PROPERTY ACQUISITIONS AND DISPOSITIONS
Acquisitions
The Company acquired 69 self storage properties with an estimated fair value of $447.8 million during the year ended December 31, 2019 and 57 self storage properties and an expansion project adjacent to an existing property with an estimated fair value of $356.6 million during the year ended December 31, 2018. Of these acquisitions, during the year ended December 31, 2019, 19 self storage properties with an estimated fair value of $131.3 million were acquired by the Company from its PROs and one self storage property with an estimated fair value of $4.1 million was acquired by the Company from the 2016 Joint Venture. During the year ended December 31, 2018, four self storage properties and the expansion project adjacent to an existing property with an estimated fair value of $23.1 million were acquired by the Company from its PROs.
The self storage property acquisitions were accounted for as asset acquisitions and accordingly, during the years ended December 31, 2019 and 2018, $3.6 million and $1.9 million, respectively, of transaction costs related to the acquisitions were capitalized as part of the basis of the acquired properties. The Company recognized the estimated fair value of the acquired assets and assumed liabilities on the respective dates of such acquisitions. The Company allocated a portion of the purchase price to identifiable intangible assets consisting of customer in-place leases which were recorded at estimated fair values of $10.9 million and $9.1 million during the years ended December 31, 2019

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and 2018, respectively, resulting in a total fair value of $436.9 million and $347.5 million allocated to real estate during the years ended December 31, 2019 and 2018, respectively.
The following table summarizes, by calendar quarter, the investments in self storage property acquisitions completed by the Company during the years ended December 31, 2019 and 2018 (dollars in thousands):
Acquisitions closed during the Three Months Ended: Summary of Investment
Number of Properties Cash and Acquisition Costs
Value of OP Equity(1)
Liabilities Assumed Total
Mortgages(2)
Other
March 31, 2019 32    $ 160,531    $ 33,356    $ —    $ 674    $ 194,561   
June 30, 2019 24    168,442    15,515    —    1,378    185,335   
September 30, 2019 6    34,624    950    —    197    35,771   
December 31, 2019 7    30,004    2,005    —    154    32,163   
Total
69    $ 393,601    $ 51,826    $ —    $ 2,403    $ 447,830   
March 31, 2018 25    $ 105,135    $ 22,403    $ 7,581    $ 670    $ 135,789   
June 30, 2018 12    62,470    —    —    467    62,937   
September 30, 2018 13    102,012    3,660    —    856    106,528   
December 31, 2018 7    49,221    2,000    —    174    51,395   
Total
57    $ 318,838    $ 28,063    $ 7,581    $ 2,167    $ 356,649   
(1)Value of OP equity represents the fair value of Series A-1 preferred units, OP units, subordinated performance units, and LTIP units.
(2)Includes fair value of debt adjustment for assumed mortgages of approximately $0.2 million during the year ended December 31, 2018.
The results of operations for these self storage acquisitions are included in the Company's statements of operations beginning on the respective closing date for each acquisition. The accompanying statements of operations includes aggregate revenue of $30.4 million and operating income of $2.5 million related to the 69 self storage properties acquired during the year ended December 31, 2019. For the year ended December 31, 2018, the accompanying statements of operations includes aggregate revenue of $21.9 million and operating income of $2.5 million related to the 57 self storage properties acquired during such period.
Dispositions
During the year ended December 31, 2019, the Company sold one self storage property to an unrelated third party. The gross sales price was $6.5 million and the Company recognized $2.8 million of gain on the sale.
During the year ended December 31, 2018, the Company sold to unrelated third parties two self storage properties. The gross sales price was $5.5 million and the Company recognized $0.4 million of gains on the sales.

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7. OTHER ASSETS
Other assets consist of the following (dollars in thousands):
December 31,
2019 2018
Customer in-place leases, net of accumulated amortization of $7,267 and $5,090, respectively
$ 3,704    $ 4,063   
Receivables:
Trade, net 2,809    3,402   
PROs and other affiliates 2,773    2,027   
Receivable from unconsolidated real estate ventures 4,765    4,573   
Property acquisition deposits 4,438    20,977   
Interest rate swaps 980    16,164   
Equity securities 7,703    —   
Prepaid expenses and other 4,762    4,266   
Corporate furniture, equipment and other, net 1,925    1,574   
Trade name 3,200    3,200   
Management contract, net of accumulated amortization of $2,272 and $1,564, respectively
8,349    9,057   
Tenant reinsurance intangible, net of accumulated amortization of $317
14,283    —   
Goodwill 5,750    5,750   
Total $ 65,441    $ 75,053   

Amortization expense related to customer in-place leases amounted to $11.3 million, $11.6 million and $13.5 million for the years ended December 31, 2019, 2018 and 2017, respectively.
The Company measured the fair value of the trade name, which has an indefinite life and is not amortized, using the relief from royalty method at acquisition.
The management contract asset is charged to amortization expense on a straight-line basis over 15 years, which represents the time period over which the majority of value was attributed in the Company’s discounted cash flow model. Amortization expense related to the management contract amounted to $0.7 million, $0.7 million and $0.7 million for the years ended December 31, 2019, 2018 and 2017 respectively.
Amortization expense related to the tenant reinsurance intangible amounted to $0.3 million for the year ended December 31, 2019. See Note 11 for additional details about the Company's tenant reinsurance intangible asset.

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8. DEBT FINANCING
The Company's outstanding debt as of December 31, 2019 and 2018 is summarized as follows (dollars in thousands):
December 31,
Interest Rate(1)
2019 2018
Credit Facility:
Revolving line of credit 3.06%    $ —    $ 139,500   
Term loan A 3.74%    125,000    235,000   
Term loan B 2.91%    250,000    155,000   
Term loan C 2.80%    225,000    105,000   
Term loan D 3.57%    175,000    125,000   
2023 Term loan facility 2.83%    175,000    175,000   
2028 Term loan facility 4.62%    75,000    75,000   
2029 Term loan facility 4.27%    100,000    —   
2029 Senior Unsecured Notes 3.98%    100,000    —   
2031 Senior Unsecured Notes 4.08%    50,000    —   
Fixed rate mortgages payable 4.16%    264,260    268,138   
Total principal 1,539,260    1,277,638   
Unamortized debt issuance costs and debt premium, net
(5,213)   464   
Total debt $ 1,534,047    $ 1,278,102   

(1)Represents the effective interest rate as of December 31, 2019. Effective interest rate incorporates the stated rate plus the impact of interest rate cash flow hedges and discount and premium amortization, if applicable. For the revolving line of credit, the effective interest rate excludes fees for unused borrowings.
Credit Facility
On July 29, 2019, the operating partnership, as borrower, the Company, and certain of the operating partnership's subsidiaries, as subsidiary guarantors, entered into a second amended and restated credit agreement with a syndicated group of lenders, which extended the maturities, enhanced the terms in line with the current market and increased the total borrowing capacity under the Company's unsecured credit facility by $255.0 million for a total of $1.275 billion (the "credit facility"). The credit facility consists of the following components: (i) a revolving line of credit (the "Revolver") which provides for a total borrowing commitment up to $500.0 million, under which the Company may borrow, repay and re-borrow amounts, (ii) a $125.0 million tranche A term loan facility (the "Term Loan A"), (iii) a $250.0 million tranche B term loan facility (the "Term Loan B"), (iv) a $225.0 million tranche C term loan facility (the "Term Loan C"), and (v) a $175.0 million tranche D term loan facility (the "Term Loan D"). The Company has an expansion option under the credit facility, which if exercised in full, would provide for a total borrowing capacity under the credit facility of $1.750 billion.
The Revolver matures in January 2024; provided that the Company may elect to extend the maturity to July 2024 by paying an extension fee of 0.075% of the total borrowing commitment thereunder at the time of extension and meeting other customary conditions with respect to compliance. The Term Loan A matures in January 2023, the Term Loan B matures in July 2024, the Term Loan C matures in January 2025 and the Term Loan D matures in July 2026. The credit facility is not subject to any scheduled reduction or amortization payments prior to maturity.
Interest rates applicable to loans under the credit facility are determined based on a 1, 2, 3 or 6 month LIBOR period (as elected by the Company at the beginning of any applicable interest period) plus an applicable margin or a base rate, determined by the greatest of the Key Bank prime rate, the federal funds rate plus 0.50% or one month LIBOR plus 1.00%, plus an applicable margin. The applicable margins for the credit facility are leverage based and range from 1.15% to 2.20% for LIBOR loans and 0.15% to 1.20% for base rate loans; provided that after such time as the Company achieves an investment grade rating as defined in the credit facility, the Company may elect (but is

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not required to elect) (a "credit rating pricing election") that the credit facility be subject to applicable margins ranging from 0.78% to 2.25% for LIBOR loans and 0.00% to 1.25% for base rate loans. The Company is also required to pay usage based fees ranging from 0.15% to 0.20% with respect to the unused portion of the Revolver; provided that if the Company makes a credit rating pricing election under the credit facility, the Company will be required to pay rating based fees ranging from 0.125% to 0.300% with respect to the entire Revolver in lieu of any usage based fees.
On July 29, 2019, the Company entered into interest rate swap agreements which together with the Company's existing interest rate swap agreements, fix the interest rates through maturity for the Term Loan A, Term Loan B, Term Loan C and Term Loan D. As of December 31, 2019, the Term Loan A, Term Loan B, Term Loan C and Term Loan D had effective interest rates of 3.74%, 2.91%, 2.80% and 3.57%, respectively.
As of December 31, 2019, the Company had outstanding letters of credit totaling $5.7 million and would have had the capacity to borrow remaining Revolver commitments of $494.3 million while remaining in compliance with the credit facility's financial covenants described in the following paragraph.
The Company is required to comply with the following financial covenants under the credit facility:
•Maximum total leverage ratio not to exceed 60%, provided, however, the Company is permitted to maintain a ratio of up to 65% up to two (2) consecutive fiscal quarters immediately following the quarter in which a material acquisition (as defined in the credit facility) occurs
•Minimum fixed charge coverage ratio of at least 1.5x
•Maximum unsecured debt to unencumbered asset value ratio not to exceed 60%, provided, however, the Company shall be permitted to maintain a ratio of up to 65% up to two (2) consecutive fiscal quarters immediately following the quarter in which a material acquisition (as defined in the credit facility) occurs
•Unencumbered adjusted net operating income to unsecured interest expense of at least 2.0x
On July 29, 2019, the financial covenants and certain other terms of the 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility were amended to make such terms substantially similar to those in the credit facility.
In addition, the terms of the credit facility contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions. At December 31, 2019, the Company was in compliance with all such covenants.
2023 Term Loan Facility
On June 30, 2016, the Company entered into a credit agreement with a syndicated group of lenders to make available a term loan facility that matures in June 2023 (the "2023 Term Loan Facility") in an aggregate amount of $100.0 million. On June 5, 2018, the Company's operating partnership and the Company entered into the Second Amendment (the "Second Amendment") to the Credit Agreement, whereby the Company's operating partnership, among other things, partially exercised its existing $100.0 million expansion option in an aggregate amount equal to $75.0 million, increasing the aggregate amount outstanding under the 2023 Term Loan Facility to $175.0 million. The Company also increased the remaining expansion option by $200.0 million, for a total expansion option of $225.0 million. If the remaining expansion option is exercised in full, the total expansion option would provide for a total borrowing capacity under the 2023 Term Loan Facility in an aggregate amount of $400.0 million.
The entire outstanding principal amount of, and all accrued but unpaid interest, is due on the maturity date. Interest rates applicable to loans under the 2023 Term Loan Facility are payable during such periods as such loans are LIBOR loans, at the applicable LIBOR based on a 1, 2, 3 or 6 month LIBOR period (as elected by the Company at the beginning of any applicable interest period) plus an applicable margin, and during the period that such loans are base rate loans, at the base rate under the 2023 Term Loan Facility in effect from time to time plus an applicable margin. The base rate under the 2023 Term Loan Facility is equal to the greatest of the Capital One prime rate, the federal funds rate plus 0.50% or one month LIBOR plus 1.00%. The applicable margin for the 2023 Term Loan Facility is leverage-based and ranges from 1.30% to 1.70% for LIBOR loans and 0.30% to 0.70% for base rate loans; provided that after such time as the Company achieves an investment grade rating from at least two rating agencies, the Company may elect (but is not required to elect) that the 2023 Term Loan Facility is subject to the rating based on applicable margins ranging from 0.90% to 1.75% for LIBOR Loans and 0.00% to 0.75% for base rate loans.

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The Company is required to comply with the same financial covenants under the 2023 Term Loan Facility as it is with the credit facility. In addition, the terms of the 2023 Term Loan Facility contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
2028 Term Loan Facility
On December 21, 2018, the Company entered into a credit agreement with Huntington National Bank to make available a term loan facility that matures in December 2028 (the "2028 Term Loan Facility") in an aggregate amount of $75.0 million. The entire outstanding principal amount of, and all accrued but unpaid interest, is due on the maturity date. The Company has an expansion option under the 2028 Term Loan Facility, which, if exercised in full, would provide for a total 2028 Term Loan Facility in an aggregate amount of $125.0 million.
Interest rates applicable to loans under the 2028 Term Loan Facility are payable during such periods as such loans are LIBOR loans, at the applicable LIBOR based on a 1, 2, 3 or 6 month LIBOR period (as elected by the Company at the beginning of any applicable interest period) plus an applicable margin, and during the period that such loans are base rate loans, at the base rate under the 2028 Term Loan Facility in effect from time to time plus an applicable margin. The base rate under the 2028 Term Loan Facility is equal to the greatest of the Huntington National Bank prime rate, the federal funds rate plus 0.50% or one month LIBOR plus 1.00%. The applicable margin for the 2028 Term Loan Facility is leverage-based and ranges from 1.80% to 2.35% for LIBOR loans and 0.80% to 1.35% for base rate loans; provided that after such time as the Company achieves an investment grade rating from at least two rating agencies, the Company may elect (but is not required to elect) that the 2028 Term Loan Facility is subject to the rating based on applicable margins ranging from 1.40% to 2.25% for LIBOR Loans and 0.40% to 1.25% for base rate loans.
The Company is required to comply with the same financial covenants under the 2028 Term Loan Facility as it is with the credit facility and the 2023 Term Loan Facility. In addition, the terms of the 2028 Term Loan Facility contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
2029 Term Loan Facility
On April 24, 2019, the Company entered into a credit agreement with BMO Harris Bank N.A. to make available an unsecured term loan facility that matures in April 2029 (the "2029 Term Loan Facility") in an aggregate amount of $100.0 million. The entire outstanding principal amount of, and all accrued but unpaid interest, is due on the maturity date.
Interest rates applicable to loans under the 2029 Term Loan Facility are payable during such periods as such loans are LIBOR loans, at the applicable LIBOR based on a 1, 2, 3 or 6 month LIBOR period (as elected by the Company at the beginning of any applicable interest period) plus an applicable margin, and during the period that such loans are base rate loans, at the base rate under the 2029 Term Loan Facility in effect from time to time plus an applicable margin. The base rate under the 2029 Term Loan Facility is equal to the greatest of the BMO Harris Bank prime rate, the federal funds rate plus 0.50% or one month LIBOR plus 1.00%. The applicable margin for the 2029 Term Loan Facility is leverage-based and ranges from 1.85% to 2.30% for LIBOR loans and 0.85% to 1.30% for base rate loans; provided that after such time as the Company achieves an investment grade rating from at least two rating agencies, the Company may elect (but is not required to elect) that the 2029 Term Loan Facility be subject to rating-based margins ranging from 1.40% to 2.25% for LIBOR Loans and 0.40% to 1.25% for base rate loans.
On April 24, 2019, the Company also entered into an interest rate swap agreement with a notional amount of $100.0 million that matures in April 2029 fixing the interest rate of the 2029 Term Loan Facility at an effective interest rate of 4.27%.
The Company is required to comply with the same financial covenants under the 2029 Term Loan Facility as it is with the credit facility, 2023 Term Loan Facility and the 2028 Term Loan Facility. In addition, the terms of the 2029 Term Loan Facility contain customary affirmative and negative covenants that are consistent with those contained in the 2023 Term Loan Facility and 2028 Term Loan Facility, and, among other things, limit the Company's ability to make distributions, make certain investments, incur debt, incur liens and enter into certain transactions.

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2029 And 2031 Senior Unsecured Notes
On August 30, 2019, the operating partnership issued $100.0 million of 3.98% senior unsecured notes due August 30, 2029 (the "2029 Senior Unsecured Notes") and $50.0 million of 4.08% senior unsecured notes due August 30, 2031 (the "2031 Senior Unsecured Notes" and together with the 2029 Senior Unsecured Notes, the "Senior Unsecured Notes") in a private placement to certain institutional accredited investors. The Senior Unsecured Notes are governed by a Note Purchase Agreement, dated July 30, 2019 (the "Note Purchase Agreement"), by and among the operating partnership as issuer, the Company, and the purchasers of Senior Unsecured Notes.
Interest is payable semiannually, on August 30th and February 28th of each year, commencing on February 28, 2020. The Senior Unsecured Notes are senior unsecured obligations of the Company and will be jointly and severally guaranteed by certain of the Company's subsidiaries, as subsidiary guarantors, upon issuance. The Senior Unsecured Notes rank pari passu with the credit facility, the 2023 Term Loan Facility, 2028 Term Loan Facility, and the 2029 Term Loan Facility. The Note Purchase Agreement contains financial covenants that are substantially similar to those described under the heading "Credit Facility" above. In addition, the terms of the Note Purchase Agreement contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
Fixed Rate Mortgages Payable
Fixed rate mortgages have scheduled maturities at various dates through October 2031, and have effective interest rates that range from 3.63% to 5.00%. Principal and interest are generally payable monthly or in monthly interest-only payments with balloon payments due at maturity.
The Company assumed fixed rate mortgages of $7.6 million in connection with four of the properties acquired during the year ended December 31, 2018.
Future Debt Maturities
Based on existing debt agreements in effect as of December 31, 2019, the scheduled principal and maturity payments for the Company's outstanding borrowings are presented in the table below (in thousands):
Year Ending December 31, Scheduled Principal and Maturity Payments Premium Amortization and Unamortized Debt Issuance Costs Total
2020 $ 40,647    $ (1,161)   $ 39,486   
2021 7,603    (1,509)   6,094   
2022 4,205    (1,511)   2,694   
2023 377,049    (1,159)   375,890   
2024 271,964    (790)   271,174   
After 2025 837,792    917    838,709   
$ 1,539,260    $ (5,213)   $ 1,534,047   

9. EQUITY-BASED AWARDS
The Company grants awards in the form of LTIP units and restricted common shares to provide equity based incentive compensation to members of its senior management team, independent trustees, advisers, consultants, other personnel, and as consideration for self storage property acquisitions.
LTIP units were first granted under the 2013 Long-Term Incentive Plan (the "2013 Plan"), which authorized up to 2.5 million LTIP units for issuance. In connection with the Company's initial public offering, the Company terminated the 2013 Plan but the awards granted thereunder remained outstanding after its termination. Restricted common shares were first granted under the 2015 National Storage Affiliates Trust Equity Incentive Plan (the "2015 Plan"), which authorizes the Company's compensation, nominating, and corporate governance committee to grant share options, restricted common shares, phantom shares, dividend equivalent rights, LTIP units and other restricted limited partnership units issued by its operating partnership and other equity-based awards up to an aggregate of 5% of the common shares issued and outstanding from time to time on a fully diluted basis (assuming, if applicable, the

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exercise of all outstanding options and the conversion of all warrants and convertible securities, including OP units and LTIP units, into common shares).
As of December 31, 2019, the Company did not have outstanding under its equity compensation plan, any options, warrants or rights to purchase the Company's common shares.
LTIP Units
Through December 31, 2019, an aggregate of 2,474,710 LTIP units have been issued under the 2013 Plan, 776,997 LTIP units have been issued under the 2015 Plan, and 315,567 LTIP units have been issued under the LP Agreement. Some of the granted LTIP units vested immediately or upon completion of the Company's initial public offering. Others vest upon the contribution of self storage properties or along a schedule at certain times through May 15, 2022.
Compensatory Grants
The Company grants two types of compensatory LTIP units, time-based LTIP unit awards that are subject to time-based vesting typically over a period of one to three years from the grant date, so long as such person remains an employee or trustee, and performance-based LTIP unit awards, which are designed to align the interests of the Company's executive officers with those of the Company's shareholders in a pay-for-performance structure. The performance-based LTIP unit awards vest contingent upon the achievement of performance criteria measured over a period of three years from the grant date, which is based on the Company's total shareholder return ("TSR") relative to the TSR of the companies in the Morgan Stanley Capital International US REIT Index and the Company's TSR relative to the TSR of its peers in the self storage industry. The value of the performance-based LTIP unit awards take into consideration the probability that the awards will ultimately vest; therefore previously recorded compensation expense is not adjusted in the event that the performance criteria is not achieved.
Compensation expense related to compensatory LTIP units granted to members of the Company's senior management team, the Company's independent trustees, advisers, consultants and other personnel is included in general and administrative expense in the accompanying statements of operations. Total compensation cost recognized for the compensatory LTIP unit awards was $4.2 million, $3.6 million and $3.5 million for the years ended December 31, 2019, 2018 and 2017, respectively. At December 31, 2019, total unvested compensation cost not yet recognized was $3.7 million. The Company expects to recognize this compensation cost over a period of approximately 2.4 years.
Time-based LTIP unit awards are granted with a fair value equal to the closing market price of the Company's common shares on the date of grant. The following table summarizes activity for the time-based LTIP unit awards for the years ended December 31, 2019, 2018 and 2017:
Time-Based LTIP Unit Awards
2019 2018 2017
Number of LTIP units Weighted Average Grant-Date Fair Value Number of LTIP units Weighted Average Grant-Date Fair Value Number of LTIP units Weighted Average Grant-Date Fair Value
Outstanding unvested at beginning of year
223,812    $ 23.54    227,766    $ 20.37    294,529    $ 14.74   
Granted 101,167    27.80    100,176    27.08    128,051    22.89   
Vested (138,028)   22.59    (104,130)   20.18    (194,814)   13.43   
Forfeited (5,014)   26.25    —    —    —    —   
Unvested at end of year 181,937    $ 26.55    223,812    $ 23.54    227,766    $ 20.37   
The aggregate fair value of the time-based LTIP unit awards that vested during the years ended December 31, 2019, 2018 and 2017 was $3.1 million, $2.1 million and $2.6 million, respectively.
The following table summarizes activity for the performance-based LTIP unit awards granted during the year ended December 31, 2019, 2018 and 2017, including the minimum, target and maximum number of LTIP units that may be earned upon the achievement of the performance criteria measured over the period of three years from the grant date.

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Performance-Based LTIP Unit Awards   
Minimum Target Maximum Weighted Average Grant-Date Fair Value
Outstanding unvested at December 31, 2016
—    —    —    $ —   
Granted —    40,390    90,874    27.63   
Outstanding unvested at December 31, 2017
—    40,390    90,874    $ 27.63   
Granted —    46,017    69,025    24.67   
Outstanding unvested at December 31, 2018
—    86,407    159,899    $ 26.35   
Granted —    53,128    106,252    29.76   
Outstanding unvested at December 31, 2019
—    139,535    266,151    $ 27.71   
The fair value of the performance-based LTIP unit awards, which have a market condition, is estimated on the date of grant using a Monte Carlo simulation. The simulation requires assumptions for expected volatility, risk-free rate of return, and dividend yield. The following table summarizes the assumptions used to value the performance-based LTIP unit awards granted during the years ended December 31, 2019, 2018 and 2017:
2019 2018 2017
Risk-free interest rate 2.51  % 2.04  % 1.58  %
Dividend yield 4.54  % 4.11  % 4.35  %
Expected volatility 25.40  % 24.44  % 29.96  %
Acquisition Consideration Grants
On December 31, 2013, the Company granted 1,683,560 LTIP units under the 2013 Plan to PROs as part of the consideration for their respective self storage property acquisitions and contributions. The following table presents the number of units vested for acquisition grants during the years ended December 31, 2019, 2018 and 2017:
Total LTIP units
Total unvested units, December 31, 2016 260,400   
Units vested in 2017 related to properties contributed or sourced by PROs (36,400)  
Total unvested units, December 31, 2017 224,000   
Units vested in 2018 related to properties contributed or sourced by PROs —   
Total unvested units, December 31, 2018 224,000   
Units vested in 2019 related to properties contributed or sourced by PROs —   
Total unvested units, December 31, 2019 224,000   

The aggregate fair value of purchase consideration recognized during the years ended December 31, 2017 was $0.9 million. As of December 31, 2019, the remaining unvested LTIP units will vest as additional self storage properties are contributed or sourced by the PROs. The fair value of such LTIP units will be recorded as additional acquisition consideration based on the fair value in the period such acquisitions are completed.
Grants to Consultants
During the years ended December 31, 2019, 2018 and 2017, the Company issued 5,714, 174 and 776 LTIP units, respectively, that were immediately vested to consultants that provided acquisition services. During the years ended December 31, 2019, 2018 and 2017, the self storage properties acquired were accounted for as asset acquisitions and accordingly, the acquisition costs related to the LTIP units granted to consultants were capitalized as part of the basis of the acquired properties. The aggregate fair value of the LTIP units was $0.2 million, less than $0.1 million and less than $0.1 million for the years ended December 31, 2019, 2018 and 2017, respectively.


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Restricted Common Shares
Through December 31, 2019, an aggregate of 72,354 restricted common shares have been issued under the 2015 Plan. These restricted common shares vest over a weighted average period of approximately 3.0 years. Restricted common shares are granted with a fair value equal to the closing market price of the Company's common shares on the date of grant. 
The following table summarizes activity for restricted common shares for the years ended December 31, 2019, 2018 and 2017:
Year Ended December 31,
2019 2018 2017
Number of Restricted Common Shares Weighted Average Grant-Date Fair Value Number of Restricted Common Shares Weighted Average Grant-Date Fair Value Number of Restricted Common Shares Weighted Average Grant-Date Fair Value
Outstanding at beginning of year
22,589    $ 24.83    21,585    $ 22.43    13,590    $ 12.40   
Granted 18,218    26.46    12,311    27.26    16,525    24.04   
Vested (10,734)   23.54    (8,041)   21.88    (8,530)   14.11   
Forfeited (4,294)   25.61    (3,266)   25.35    —    —   
Unvested at end of year 25,779    $ 26.26    22,589    $ 24.83    21,585    $ 22.43   

The aggregate fair value of restricted common shares that vested during the years ended December 31, 2019, 2018 and 2017 was $0.3 million, $0.2 million and $0.1 million respectively. Total compensation cost recognized for restricted common shares during the years ended December 31, 2019, 2018 and 2017 was $0.3 million, $0.3 million and $0.2 million, respectively. At December 31, 2019, total unvested compensation cost not yet recognized was $0.4 million. The Company expects to recognize this compensation cost over a period of approximately 2.0 years. If the grantee has a termination of service for any reason during the vesting period, the unvested restricted common shares will be forfeited. Compensation expense related to restricted common shares is included in general and administrative expense in the accompanying statements of operations.

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10. EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted earnings (loss) per common share for the years ended December 31, 2019, 2018 and 2017 (in thousands, except per share amounts):
Year Ended December 31,
2019 2018 2017
Earnings (loss) per common share - basic and diluted
Numerator
Net income $ 66,013    $ 56,326    $ 45,998   
Net income attributable to noncontrolling interests
(62,030)   (42,217)   (43,037)  
Net income attributable to National Storage Affiliates Trust
3,983    14,109    2,961   
Distributions to preferred shareholders (12,390)   (10,350)   (2,300)  
Distributed and undistributed earnings allocated to participating securities
(35)   (27)   (28)  
Net (loss) income attributable to common shareholders - basic and diluted
$ (8,442)   $ 3,732    $ 633   
Denominator
Weighted average shares outstanding - basic and diluted
58,208    53,293    44,423   
Earnings (loss) per share - basic and diluted $ (0.15)   $ 0.07    $ 0.01   
Dividends declared per common share
$ 1.27    $ 1.16    $ 1.04   
As discussed in Note 2, the Company allocates GAAP income (loss) utilizing the HLBV method, in which the Company allocates income or loss based on the change in each unitholders' claim on the net assets of its operating partnership at period end after adjusting for any distributions or contributions made during such period. Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to National Storage Affiliates Trust and noncontrolling interests, resulting in volatile fluctuations of basic and diluted earnings (loss) per share.
Outstanding equity interests of the Company's operating partnership and DownREIT partnerships are considered potential common shares for purposes of calculating diluted earnings (loss) per share as the unitholders may, through the exercise of redemption rights, obtain common shares, subject to various restrictions. Basic earnings per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by further adjusting for the dilutive impact using the treasury stock method for unvested LTIP units subject to a service condition outstanding during the period and the if-converted method for any convertible securities outstanding during the period.
Generally, following certain lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at the Company's option, exchangeable for common shares on a one-for-one basis, subject to certain adjustments and DownREIT OP units are redeemable for cash or, at the Company's option, exchangeable for OP units in its operating partnership on a one-for-one basis, subject to certain adjustments in each case.
LTIP units may also, under certain circumstances, be convertible into OP units on a one-for-one basis, which are then exchangeable for common shares as described above. Vested LTIP units and unvested LTIP units that vest based on a service condition are allocated income or loss in a similar manner as OP units. Unvested LTIP units subject to a service condition are evaluated for dilution using the treasury stock method. For the year ended December 31, 2019, 448,089 unvested LTIP units that vest based on a service condition are excluded from the calculation of diluted earnings (loss) per share as they are not dilutive to earnings (loss) per share. For the year ended December 31, 2019, 224,000 unvested LTIP units that vest upon the future acquisition of properties are excluded from the calculation of diluted earnings (loss) per share because the contingency for the units to vest has not been attained as of the end of the reported period.
Subordinated performance units may also, under certain circumstances, be convertible into OP units which are exchangeable for common shares as described above, and DownREIT subordinated performance units may, under

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certain circumstances, be exchangeable for subordinated performance units on a one-for-one basis. Subordinated performance units are only convertible into OP units, after a two year lock-out period and then generally (i) at the holder’s election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at the Company's election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations. Although subordinated performance units may only be convertible after a two year lock-out period, the Company assumes a hypothetical conversion of each subordinated performance unit (including each DownREIT subordinated performance unit) into OP units (with subsequently assumed redemption into common shares) for the purposes of calculating diluted weighted average common shares. This hypothetical conversion is calculated using historical financial information, and as a result, is not necessarily indicative of the results of operations, cash flows or financial position of the Company upon expiration of the two-year lock out period on conversions.
For the years ended December 31, 2019, 2018 and 2017, potential common shares totaling 54.2 million, 50.6 million and 50.6 million, respectively, related to OP units, DownREIT OP units, subordinated performance units, DownREIT subordinated performance units and vested LTIP units have been excluded from the calculation of diluted earnings (loss) per share as they are not dilutive to earnings (loss) per share.
Participating securities, which consist of unvested restricted common shares, receive dividends equal to those received by common shares. The effect of participating securities for the periods presented above is calculated using the two-class method of allocating distributed and undistributed earnings.
11. RELATED PARTY TRANSACTIONS
Supervisory and Administrative Fees
For the self storage properties that are managed by the PROs, the Company has entered into asset management agreements with the PROs to provide leasing, operating, supervisory and administrative services. The asset management agreements generally provide for fees ranging from 5% to 6% of gross revenue for the managed self storage properties. During the years ended December 31, 2019, 2018 and 2017, the Company incurred $20.0 million, $16.9 million and $14.4 million, respectively, for supervisory and administrative fees to the PROs. Such fees are included in general and administrative expenses in the accompanying statements of operations.
Payroll Services
For the self storage properties that are managed by the PROs, the employees responsible for operation of the self storage properties are generally employees of the PROs who charge the Company for the costs associated with the respective employees. For the years ended December 31, 2019, 2018 and 2017, the Company incurred $32.0 million, $29.5 million and $24.6 million, respectively, for payroll and related costs reimbursable to these PROs. Such costs are included in property operating expenses in the accompanying statements of operations.
Due Diligence Costs
During the years ended December 31, 2019, 2018 and 2017, the Company incurred $0.7 million, $0.4 million and $0.7 million, respectively, of expenses payable to certain PROs related to self storage property acquisitions sourced by the PROs. These expenses, which are based on the volume of transactions sourced by the PROs, are intended to reimburse the PROs for due diligence costs incurred in the sourcing and underwriting process. For the years ended December 31, 2019, 2018 and 2017 these due diligence costs are capitalized as part of the basis of the acquired self storage properties.
Notes Receivable
 In connection with the acquisition of 16 self storage properties from PROs during the year ended December 31, 2014, the Company assumed certain mortgages that provided for interest at above-market rates. The sellers of the self storage properties agreed to reimburse the Company for the difference between the fair value and the contractual value of the assumed mortgages which amounted to $5.2 million. Due to the structure of the transaction, the amount owed to the Company was considered a receivable for the issuance of equity and was recorded as an offset against equity. During the years ended December 31, 2019 and 2018, the Company received above-market interest reimbursements from the sellers totaling $1.3 million and $1.2 million, respectively.
In addition, in exchange for $1.3 million and $1.2 million of principal payment reimbursements received related to these assumed mortgages during the years ended December 31, 2019 and 2018, the Company issued 37,770 common shares and 44,502 OP units to the sellers during the year ended December 31, 2019 and 2018, respectively.

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Self Storage Property Acquisitions
During the year ended December 31, 2019, the Company issued 11,100 subordinated performance units to an affiliate of Personal Mini (the Company's executive chairman and former chief executive officer, Arlen D. Nordhagen, has a noncontrolling minority ownership interest in this affiliate of Personal Mini), for $0.4 million of co-investment related to the acquisition of a self storage property from an unrelated third party.
During the year ended December 31, 2019, the Company acquired one self storage property from the 2016 Joint Venture for $4.1 million.
Acquisition of Interest in Reinsurance Company and Related Cash Flows
On June 1, 2019, the Company, as acquiror, and Ground Up Development LLC ("Ground Up"), an affiliate of SecurCare and of the Company's executive chairman and former chief executive officer, Arlen D. Nordhagen, entered into a Contribution and Purchase Agreement (the "Ground Up Contribution Agreement") whereby the Company acquired Ground Up’s ownership interest (approximately 5.5%) in SBOA TI Reinsurance Ltd. (the "Reinsurance Company"), a Cayman Islands exempted company. The Reinsurance Company provides reinsurance for a self storage tenant insurance program issued by a licensed insurance company, whereby tenants of the Company's self storage facilities and tenants of other operators participating in the program can purchase insurance to cover damage or destruction to their personal property while stored at such facilities. The Company will now be entitled to receive its share of distributions of any profits generated by the Reinsurance Company, depending on actual losses incurred by the program. As part of the transaction, the Company also acquired the rights to the access fees previously earned by Ground Up associated with the tenant insurance-related arrangements. For the Company's properties managed by SecurCare, in addition to the tenant insurance revenues the Company received directly from the program insurer, the Company also receives these additional access fees.
The consideration paid for the interest in the Reinsurance Company was $15.1 million, which consisted of $6.6 million of cash and 285,512 OP units totaling $8.5 million. Of the total consideration transferred, Arlen D. Nordhagen received $2.2 million of cash and 95,170 OP Units totaling approximately $2.8 million. The Ground Up Contribution Agreement contains customary representations, warranties, covenants and agreements of the Company and Ground Up.
The Company allocated the total purchase price to the estimated fair value of the assets acquired, consisting of $0.5 million of equity interest in the Reinsurance Company and $14.6 million as an intangible related to the acquired access fees and rights to control the tenant insurance-related arrangements. These assets are reported in other assets, net in the Company's consolidated balance sheets. The intangible asset is amortized on a straight-line basis over 25 years, which approximates the weighted average remaining useful life of the SecurCare-managed properties, and is recorded in depreciation and amortization expense in the Company's consolidated statements of operations.
12. COMMITMENTS AND CONTINGENCIES
Legal Proceedings
The Company is subject to litigation, claims, and assessments that may arise in the ordinary course of its business activities. Such matters include contractual matters, employment related issues, and regulatory proceedings. Although occasional adverse decisions or settlements may occur, the Company believes that the final disposition of such matters will not have a material adverse effect on the Company's financial position, results of operations, or liquidity.
13. LEASES
The Company determines if a contractual arrangement is a lease at inception. As a lessee, the Company has non-cancelable lease agreements for real estate and its corporate office space that are classified as operating leases. The Company's operating leases are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in its consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's operating leases do not provide an implicit rate, the Company used its incremental borrowing rate based on the information available at commencement date in determining the discount rate for the present value of the lease payments. To the extent that the lease agreements provide for fixed increases throughout the term of the lease, the Company recognizes lease expense on a straight-line basis over the expected lease terms.

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Real Estate Leasehold Interests
The Company has eight properties that are subject to non-cancelable leasehold interest agreements with remaining lease terms ranging from 15 to 73 years, inclusive of extension options that the Company anticipates exercising. Rent expense under these leasehold interest agreements is included in property operating expenses in the accompanying consolidated statements of operations and amounted to $1.6 million, $1.6 million and $1.2 million for the years ended December 31, 2019, 2018 and 2017, respectively.
Office Leases
The Company has entered into non-cancelable lease agreements for its corporate office space with remaining lease terms ranging from three to seven years. Rent expense related to these office leases is included in general and administrative expenses in the accompanying consolidated statements of operations and amounted to $0.3 million, $0.2 million and $0.2 million for the years ended December 31, 2019, 2018 and 2017, respectively.
The weighted-average remaining lease term and the weighted-average discount rate for the Company's operating leases as of December 31, 2019 are as follows:
December 31, 2019
Weighted-average remaining lease term
Real estate leasehold interests 29 years
Office leases 7 years
Weighted-average remaining discount rate
Real estate leasehold interests 4.9  %
Office leases 4.1  %
As of December 31, 2019, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):
Year Ending December 31, Real Estate Leasehold Interests Office Leases Total
2020 $ 1,419    $ 286    $ 1,705   
2021 1,444    387    1,831   
2022 1,459    381    1,840   
2023 1,464    346    1,810   
2024 1,470    353    1,823   
2025 through 2092 36,728    691    37,419   
Total lease payments $ 43,984    $ 2,444    $ 46,428   
Less imputed interest (21,440)   (323)   (21,763)  
Total $ 22,544    $ 2,121    $ 24,665   

As of December 31, 2018, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):
Year Ending December 31, Real Estate Leasehold Interests Office Leases Total
2019 $ 1,334    $ 345    $ 1,679   
2020 1,379    398    1,777   
2021 1,404    387    1,791   
2022 1,419    381    1,800   
2023 1,424    346    1,770   
2024 through 2092 36,074    1,073    37,147   
Total lease payments $ 43,034    $ 2,930    $ 45,964   


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14. FAIR VALUE MEASUREMENTS
Recurring Fair Value Measurements
The Company sometimes limits its exposure to interest rate fluctuations by entering into interest rate swap agreements. The interest rate swap agreements moderate the Company's exposure to interest rate risk by effectively converting the interest on variable rate debt to a fixed rate. The Company measures its interest rate swap derivatives at fair value on a recurring basis. The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income (loss) and are subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The ineffective portion of the change in fair value of the derivatives is recognized directly into earnings.
Information regarding the Company's interest rate swaps measured at fair value, which are classified within Level 2 of the GAAP fair value hierarchy, is presented below (dollars in thousands):
Interest Rate Swaps Designated as Cash Flow Hedges
Fair value at December 31, 2017 $ 12,414   
Gains on interest rate swaps reclassified into interest expense from accumulated other comprehensive income
(1,817)  
Unrealized gains on interest rate swaps included in accumulated other comprehensive income
3,598   
Fair value at December 31, 2018 $ 14,195   
Gains on interest rate swaps reclassified into interest expense from accumulated other comprehensive income
(3,337)  
Unrealized losses on interest rate swaps included in accumulated other comprehensive income
(29,941)  
Fair value at December 31, 2019 $ (19,083)  
As of December 31, 2019 and 2018, the Company had outstanding interest rate swaps designated as cash flow hedges with aggregate notional amounts of $1,125.0 million and $795.0 million, respectively. As of December 31, 2019, the Company's swaps had a weighted average remaining term of 4.3 years. The fair value of these swaps are presented within other assets and accounts payable and accrued liabilities in the accompanying balance sheets, and the Company recognizes any changes in the fair value as an adjustment of accumulated other comprehensive income (loss) within equity to the extent of their effectiveness. If the forward rates at December 31, 2019 remain constant, the Company estimates that during the next 12 months, the Company would reclassify into earnings approximately $3.2 million of the unrealized losses included in accumulated other comprehensive income (loss). If market interest rates increase above the 1.90% weighted average fixed rate under these interest rate swaps the Company will benefit from net cash payments due to it from its counterparty to the interest rate swaps.
There were no transfers between levels during the years ended December 31, 2019 and 2018. For financial assets and liabilities that utilize Level 2 inputs, the Company utilizes both direct and indirect observable price quotes, including LIBOR yield curves. The Company uses valuation techniques for Level 2 financial assets and liabilities which include LIBOR yield curves at the reporting date as well as assessing counterparty credit risk. Counterparties to these contracts are highly rated financial institutions. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the Company's derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and the counterparties. As of December 31, 2019 and 2018, the Company determined that the effect of credit valuation adjustments on the overall valuation of its derivative positions are not significant to the overall valuation of its derivatives. Therefore, the Company has determined that its derivative valuations are appropriately classified in Level 2 of the fair value hierarchy.

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Fair Value Disclosures
The carrying values of cash and cash equivalents, restricted cash, trade receivables, accounts payable and accrued liabilities and equity securities reflected in the balance sheets at December 31, 2019 and 2018, approximate fair value due to the short term nature of these financial assets and liabilities. The carrying value of variable rate debt financing reflected in the balance sheets at December 31, 2019 and 2018 approximates fair value as the changes in their associated interest rates reflect the current market and credit risk is similar to when the loans were originally obtained.
The fair values of fixed rate mortgages were estimated using the discounted estimated future cash payments to be made on such debt; the discount rates used approximated current market rates for loans, or groups of loans, with similar maturities and credit quality (categorized within Level 2 of the fair value hierarchy). The combined principal balance of the Company's fixed rate mortgages payable was approximately $264.3 million as of December 31, 2019 with a fair value of approximately $280.9 million. In determining the fair value, the Company estimated a weighted average market interest rate of approximately 3.28%, compared to the weighted average contractual interest rate of 4.81%. The combined principal balance of the Company's fixed rate mortgages was approximately $268.1 million as of December 31, 2018 with a fair value of approximately $276.5 million. In determining the fair value as of December 31, 2018, the Company estimated a weighted average market interest rate of approximately 4.17%, compared to the weighted average contractual interest rate of 4.85%.
15. UNAUDITED SELECTED QUARTERLY FINANCIAL DATA
The following is a summary of quarterly financial information for the years ended December 31, 2019 and 2018 (in thousands, except per share data):
For the three months ended
March 31, June 30, September 30, December 31,
2019 2019 2019 2019
Total revenues
$ 90,572    $ 95,419    $ 101,337    $ 100,568   
Total operating expenses 61,572    64,189    68,625    66,661   
Gain on sale of self storage properties
—    2,814    —    —   
Net income 12,940    17,733    16,514    18,826   
Net income (loss) attributable to common shareholders
$ 4,823    $ (10,913)   $ (12,132)   $ 9,815   
Earnings (loss) per share - basic $ 0.08    $ (0.19)   $ (0.20)   $ 0.17   
Earnings (loss) per share - diluted $ 0.08    $ (0.19)   $ (0.20)   $ 0.13   

For the three months ended
March 31, June 30, September 30, December 31,
2018 2018 2018 2018
Total revenues
$ 76,493    $ 79,723    $ 85,382    $ 89,298   
Total operating expenses 54,900    56,033    57,869    60,440   
Gain (loss) on sale of self storage properties
474    (83)   —    —   
Net income 11,973    13,041    16,829    14,483   
Net income (loss) attributable to common shareholders
$ 7,872    $ 3,304    $ 1,806    $ (9,223)  
Earnings (loss) per share - basic $ 0.16    $ 0.07    $ 0.03    $ (0.16)  
Earnings (loss) per share - diluted $ 0.09    $ 0.07    $ 0.03    $ (0.16)  


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16. SUBSEQUENT EVENTS
Internalization and Acquisition of PRO
On February 24, 2020, the Company entered into a definitive agreement with SecurCare, and, among others, Arlen Nordhagen, the Company's executive chairman and former chief executive officer, who owns approximately 53% of SecurCare's outstanding shares, to merge SecurCare into a wholly owned subsidiary of the Company. On the same day, the Company entered into a definitive agreement with DLAN Corporation ("DLAN") to merge DLAN into another wholly owned subsidiary of the Company. DLAN is an entity controlled by Mr. Nordhagen that was formed solely to hold OP units and DownREIT OP units, and it is owned by Mr. Nordhagen's spouse, Wendy Nordhagen, and David Lamb, who is a key person of another existing PRO of the Company.
As a result of the SecurCare merger, SecurCare's property management platform and related intellectual property will be internalized by the Company, and the Company will no longer pay any supervisory and administrative fees or reimbursements to SecurCare. In addition, distributions on the series of subordinated performance units related to SecurCare's managed portfolio (the "Series SC subordinated performance units") will be discontinued.
As part of the internalization, most of SecurCare's employees and other key persons will be offered employment by the Company and will continue managing SecurCare's portfolio of properties under the brand SecurCare as members of the Company's existing property management platform. Under the terms of the Company's facilities portfolio management agreement with SecurCare, in connection with a retirement event leading to the internalization of SecurCare's property management platform, SecurCare is entitled to receive OP units in exchange for its property management platform and related intellectual property based on a contractual formula. The Company has determined that SecurCare would be entitled to receive 384,020 OP units as part of the internalization transaction. The Company expects that the acquisition of SecurCare's property management platform and related intellectual property will be accounted for as a business combination, whereby the Company will allocate the total purchase price to the estimated fair value of tangible and intangible assets acquired, and liabilities assumed.
Immediately prior to the completion of the mergers, giving effect to the OP units that SecurCare owns or would be entitled to receive as part of the internalization and the conversion of 2,015,808 of the Series SC subordinated performance units into 6,769,083 OP units in connection with a retirement event leading to the internalization of SecurCare's property management platform, SecurCare and DLAN will own, or have the right to receive, an aggregate of 8,187,052 OP units. While OP units are economically equivalent to and exchangeable for common shares on a one-to-one basis, in the SecurCare and DLAN mergers, the Company expects to issue 8,105,192 common shares to the owners of SecurCare and DLAN, which represents a 1% discount to the number OP units that each of SecurCare and DLAN will own or be entitled to receive as set forth above immediately prior to the mergers. Of the total number of common shares expected to be issued to the owners of SecurCare, approximately 4.1 million common shares are expected to be issued to Mr. Nordhagen.
Although the Company currently expects to complete the transactions described above during the second quarter of 2020, they are subject to customary closing conditions, and there is no assurance that the transactions will be consummated at all or at the time or pursuant to the terms currently contemplated.
Self Storage Property Acquisitions
In January and February 2020, the Company acquired 34 self storage properties for approximately $205.8 million. Consideration for these acquisitions included approximately $200.6 million of net cash, the assumption of $0.9 million of other working capital liabilities and OP equity of approximately $4.3 million (consisting of the issuance of 73,329 OP Units, 28,894 LTIP units and 13,105 subordinated performance units). In connection with these acquisitions, the Company reimbursed the PROs for $0.2 million of due diligence costs related to the self storage properties sourced by the PROs.
In February 2020, the 2016 Joint Venture acquired two self storage properties for approximately $12.1 million. The 2016 Joint Venture financed the acquisitions with capital contributions from the 2016 Joint Venture members, of which the Company contributed $3.0 million.
Subordinated Performance Unit To OP Unit Conversions
Subordinated performance units are convertible into OP units after a two year lock-out period and then generally (i) at the holder’s election only upon the achievement of certain performance thresholds relating to the

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properties to which such subordinated performance units relate (a "voluntary conversion") or (ii) at the Company's election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations.
Following such lock-out period, a holder of subordinated performance units in the Company's operating partnership may elect a voluntary conversion one time each year prior to December 1st to convert a pre-determined portion of such subordinated performance units into OP units in the Company's operating partnership, with such conversion effective January 1st of the following year with each subordinated performance unit being converted into the number of OP units determined by dividing the average cash available for distribution, or CAD, per unit on the series of specific subordinated performance units over the one-year period prior to conversion by 110% of the CAD per unit on the OP units determined over the same period. CAD per unit on the series of specific subordinated performance units and OP units is determined by the Company based generally upon the application of the provisions of the operating partnership agreement applicable to the distributions of operating cash flow and capital transactions proceeds.
During the year ended December 31, 2019, the Company received notices requesting the conversion of 332,738 subordinated performance units. Effective January 1, 2020, the Company issued 445,701 OP units in satisfaction of such conversion requests.



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NATIONAL STORAGE AFFILIATES TRUST
SCHEDULE III-REAL ESTATE AND ACCUMULATED DEPRECIATION
December 31, 2019
(dollars in thousands)
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Mobile AL $ 991    $ 4,874    $ 753    $ 991    $ 5,627    $ 6,618    $ 1,196    4/12/2016
Lake Havasu City-Kingman AZ 671    1,572    53    671    1,625    2,296    486    4/1/2014
Lake Havasu City-Kingman AZ 722    2,546    66    722    2,612    3,334    845    7/1/2014
Phoenix-Mesa-Scottsdale AZ 1,089    6,607    89    1,089    6,696    7,785    1,657    6/30/2014
Phoenix-Mesa-Scottsdale AZ 3,813    7,831    91    3,813    7,922    11,735    1,493    9/30/2014
Phoenix-Mesa-Scottsdale AZ 1,375    2,613    94    1,375    2,707    4,082    906    9/30/2014
Phoenix-Mesa-Scottsdale AZ 1,653    7,531    47    1,653    7,578    9,231    1,240    10/1/2014
Phoenix-Mesa-Scottsdale AZ 1,661    3,311    75    1,661    3,386    5,047    703    10/1/2014
Phoenix-Mesa-Scottsdale AZ 1,050    5,359    49    1,050    5,408    6,458    697    1/1/2015
Phoenix-Mesa-Scottsdale AZ 1,198    1,921    49    1,198    1,970    3,168    433    5/1/2015
Phoenix-Mesa-Scottsdale AZ 1,324    3,626    64    1,324    3,690    5,014    668    5/1/2015
Phoenix-Mesa-Scottsdale AZ 3,816    4,348    38    3,816    4,386    8,202    767    5/1/2015
Phoenix-Mesa-Scottsdale AZ 5,576    6,746    283    5,576    7,029    12,605    1,343    5/19/2016
Phoenix-Mesa-Scottsdale AZ 1,506    2,881    226    1,609    3,107    4,716    421    7/29/2016
Phoenix-Mesa-Scottsdale AZ 2,120    5,442    26    2,120    5,468    7,588    534    2/13/2017
Phoenix-Mesa-Scottsdale AZ 1,809    4,787    53    1,809    4,840    6,649    397    1/4/2018
Phoenix-Mesa-Scottsdale AZ 840    5,274    18    840    5,292    6,132    422    1/4/2018
Phoenix-Mesa-Scottsdale AZ 2,111    7,963    37    2,111    8,000    10,111    586    1/4/2018
Phoenix-Mesa-Scottsdale AZ 748    4,027    204    748    4,231    4,979    367    1/11/2018
Phoenix-Mesa-Scottsdale AZ 676    4,098    81    676    4,179    4,855    318    1/11/2018
Phoenix-Mesa-Scottsdale AZ 1,011    3,453    65    1,011    3,518    4,529    263    1/11/2018
Phoenix-Mesa-Scottsdale AZ 1,125    3,554    78    1,125    3,632    4,757    317    1/11/2018
Phoenix-Mesa-Scottsdale AZ 949    7,351    59    949    7,410    8,359    472    1/11/2018
Phoenix-Mesa-Scottsdale AZ 1,419    5,504    71    1,419    5,575    6,994    421    1/11/2018
Phoenix-Mesa-Scottsdale AZ 1,117    5,918    224    1,117    6,142    7,259    383    2/1/2018
Phoenix-Mesa-Scottsdale AZ 1,231    5,107    9    1,231    5,116    6,347    186    1/1/2019
Phoenix-Mesa-Scottsdale AZ 806    4,041    179    806    4,220    5,026    79    6/19/2019
Tucson AZ 421    3,855    116    421    3,971    4,392    709    8/29/2013
Tucson AZ 716    1,365    26    716    1,391    2,107    460    8/29/2013
Tucson AZ 358    2,047    499    358    2,546    2,904    223    1/4/2018
Tucson AZ 439    2,501    54    439    2,555    2,994    216    1/4/2018
Tucson AZ 606    2,580    419    606    2,999    3,605    274    1/4/2018
Bakersfield CA 511    2,804    207    511    3,011    3,522    469    8/1/2016
Bakersfield CA 1,409    3,907    203    1,228    4,110    5,338    572    8/1/2016

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Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Bakersfield CA 1,882    3,858    112    1,882    3,970    5,852    643    8/1/2016
Bakersfield CA 1,355    4,678    314    1,355    4,992    6,347    740    8/1/2016
Bakersfield CA 1,306    3,440    133    1,306    3,573    4,879    704    8/1/2016
Bakersfield CA 1,016    3,638    127    1,016    3,765    4,781    495    8/1/2016
Bakersfield CA 1,579    3,357    121    1,579    3,478    5,057    577    8/1/2016
Bakersfield CA 750    5,802    128    750    5,930    6,680    820    8/1/2016
Fresno CA 840    7,502    460    840    7,962    8,802    1,495    8/1/2016
Los Angeles-Long Beach-Anaheim CA 1,530    5,799    313    1,530    6,112    7,642    619    8/1/2016
Los Angeles-Long Beach-Anaheim CA 2,345    6,820    684    2,345    7,504    9,849    772    8/1/2016
Los Angeles-Long Beach-Anaheim CA 1,350    11,266    169    1,350    11,435    12,785    1,321    8/1/2016
Los Angeles-Long Beach-Anaheim CA 763    6,258    231    763    6,489    7,252    763    8/1/2016
Los Angeles-Long Beach-Anaheim CA 6,641    8,239    79    6,641    8,318    14,959    1,503    4/1/2014
Los Angeles-Long Beach-Anaheim CA 1,122    1,881    36    1,122    1,917    3,039    468    6/30/2014
Los Angeles-Long Beach-Anaheim(3) CA 14,109    23,112    305    14,109    23,417    37,526    5,156    9/17/2014
Los Angeles-Long Beach-Anaheim(3) CA 7,186    12,771    278    7,186    13,049    20,235    2,782    9/17/2014
Los Angeles-Long Beach-Anaheim(3)(4) CA —    7,106    62    —    7,168    7,168    1,485    9/17/2014
Los Angeles-Long Beach-Anaheim(3) CA 2,366    4,892    130    2,366    5,022    7,388    1,122    9/17/2014
Los Angeles-Long Beach-Anaheim(3) CA 2,871    3,703    49    2,871    3,752    6,623    718    10/7/2014
Los Angeles-Long Beach-Anaheim(3) CA 5,448    10,015    237    5,448    10,252    15,700    2,309    10/7/2014
Los Angeles-Long Beach-Anaheim(4) CA —    13,150    55    —    13,205    13,205    2,219    1/1/2015
Los Angeles-Long Beach-Anaheim(4) CA —    10,084    124    —    10,208    10,208    668    10/3/2017
Modesto CA 1,526    12,032    67    1,526    12,099    13,625    1,509    11/10/2016
Modesto CA 773    5,655    19    773    5,674    6,447    592    11/10/2016
Nonmetropolitan Area CA 425    7,249    22    425    7,271    7,696    822    11/10/2016
Riverside-San Bernardino-Ontario CA 1,842    3,420    55    1,842    3,475    5,317    603    1/1/2015
Riverside-San Bernardino-Ontario CA 1,981    3,323    75    1,981    3,398    5,379    735    1/1/2015
Riverside-San Bernardino-Ontario(3) CA 3,418    9,907    203    3,418    10,110    13,528    1,629    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 1,913    6,072    22    1,913    6,094    8,007    1,105    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 772    4,044    98    772    4,142    4,914    918    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 597    5,464    80    597    5,544    6,141    897    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 3,022    8,124    95    3,022    8,219    11,241    1,517    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 2,897    5,725    671    2,467    6,396    8,863    1,483    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 2,835    5,589    858    2,164    6,447    8,611    1,357    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 2,484    5,903    83    2,484    5,986    8,470    879    8/5/2015
Riverside-San Bernardino-Ontario(3) CA 1,139    5,054    36    1,139    5,090    6,229    880    10/1/2015

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Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Riverside-San Bernardino-Ontario(3) CA 1,401    4,577    30    1,401    4,607    6,008    619    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 925    3,459    52    925    3,511    4,436    627    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,174    2,556    107    1,174    2,663    3,837    559    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,506    2,913    47    1,506    2,960    4,466    495    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 631    2,307    63    631    2,370    3,001    537    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,318    2,394    56    1,318    2,450    3,768    528    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,942    2,647    37    1,942    2,684    4,626    681    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,339    2,830    55    1,339    2,885    4,224    564    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,105    2,672    59    1,105    2,731    3,836    640    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,542    2,127    44    1,542    2,171    3,713    506    10/1/2015
Riverside-San Bernardino-Ontario(3) CA 1,478    4,534    45    1,478    4,579    6,057    632    10/1/2015
Riverside-San Bernardino-Ontario CA 3,245    4,420    1,457    3,245    5,877    9,122    1,289    5/16/2016
Riverside-San Bernardino-Ontario CA 670    8,613    450    670    9,063    9,733    1,063    8/1/2016
Riverside-San Bernardino-Ontario CA 538    3,921    384    538    4,305    4,843    540    8/1/2016
Riverside-San Bernardino-Ontario CA 382    3,442    338    382    3,780    4,162    475    8/1/2016
Riverside-San Bernardino-Ontario CA 806    3,852    569    806    4,421    5,227    558    8/1/2016
Riverside-San Bernardino-Ontario CA 570    4,238    360    570    4,598    5,168    548    8/1/2016
Riverside-San Bernardino-Ontario CA 345    3,270    163    345    3,433    3,778    460    8/1/2016
Riverside-San Bernardino-Ontario CA 252    4,419    339    252    4,758    5,010    584    9/1/2016
Riverside-San Bernardino-Ontario CA 2,691    3,950    209    2,691    4,159    6,850    480    9/1/2016
Riverside-San Bernardino-Ontario CA 302    4,169    115    302    4,284    4,586    489    5/8/2017
Riverside-San Bernardino-Ontario CA 896    6,397    515    896    6,912    7,808    753    5/31/2017
Riverside-San Bernardino-Ontario(3) CA 552    3,010    130    552    3,140    3,692    953    5/16/2008
Riverside-San Bernardino-Ontario CA 1,342    4,446    266    1,342    4,712    6,054    1,648    4/1/2013
Riverside-San Bernardino-Ontario CA 1,672    2,564    61    1,672    2,625    4,297    631    4/1/2014
Riverside-San Bernardino-Ontario CA 978    1,854    307    978    2,161    3,139    710    5/30/2014
Riverside-San Bernardino-Ontario CA 1,068    2,609    119    1,068    2,728    3,796    765    5/30/2014
Riverside-San Bernardino-Ontario CA 1,202    2,032    94    1,202    2,126    3,328    528    6/30/2014
Riverside-San Bernardino-Ontario CA 1,803    2,758    148    1,803    2,906    4,709    929    6/30/2014
Riverside-San Bernardino-Ontario CA 1,337    4,489    70    1,337    4,559    5,896    1,011    6/30/2014
Riverside-San Bernardino-Ontario CA 846    2,508    122    846    2,630    3,476    812    7/1/2014
Riverside-San Bernardino-Ontario(3) CA 1,026    4,552    83    1,026    4,635    5,661    971    9/17/2014
Riverside-San Bernardino-Ontario(3) CA 1,878    5,104    98    1,878    5,202    7,080    969    9/17/2014
Riverside-San Bernardino-Ontario CA 3,974    6,962    150    3,974    7,112    11,086    1,882    10/1/2014
Riverside-San Bernardino-Ontario CA 2,018    3,478    728    2,018    4,206    6,224    1,430    10/1/2014

F-44
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Riverside-San Bernardino-Ontario CA 1,644    2,588    61    1,644    2,649    4,293    223    5/17/2018
Sacramento-Roseville-Arden-Arcade CA 1,195    8,407    35    1,195    8,442    9,637    856    11/10/2016
Sacramento-Roseville-Arden-Arcade CA 1,652    9,510    223    1,652    9,733    11,385    560    9/26/2018
San Diego-Carlsbad CA 4,318    19,775    1,087    4,323    20,862    25,185    2,110    8/1/2016
San Diego-Carlsbad(3) CA 3,703    5,582    89    3,703    5,671    9,374    1,079    9/17/2014
San Diego-Carlsbad CA 3,544    4,915    265    3,544    5,180    8,724    1,063    10/1/2014
San Diego-Carlsbad(4) CA —    5,568    127    —    5,695    5,695    795    1/1/2015
San Diego-Carlsbad(4) CA —    4,041    72    —    4,113    4,113    1,050    1/31/2015
Stockton-Lodi CA 559    5,514    15    559    5,529    6,088    584    11/10/2016
Stockton-Lodi CA 1,710    8,995    50    1,710    9,045    10,755    1,089    11/10/2016
Stockton-Lodi CA 1,637    11,901    55    1,637    11,956    13,593    915    7/31/2017
Colorado Springs CO 455    1,351    65    455    1,416    1,871    461    8/29/2007
Colorado Springs CO 588    2,162    1,139    588    3,301    3,889    978    3/26/2008
Colorado Springs CO 632    3,118    419    632    3,537    4,169    1,152    3/26/2008
Colorado Springs CO 414    1,535    351    414    1,886    2,300    616    5/1/2008
Colorado Springs(3) CO 300    1,801    129    300    1,930    2,230    521    6/1/2009
Colorado Springs CO 766    5,901    625    766    6,526    7,292    553    10/19/2017
Denver-Aurora-Lakewood CO 868    128    2,306    868    2,434    3,302    593    6/22/2009
Denver-Aurora-Lakewood CO 938    8,449    39    938    8,488    9,426    771    11/1/2016
Fort Collins CO 3,213    3,087    226    3,213    3,313    6,526    1,046    8/29/2007
Fort Collins CO 2,514    1,786    115    2,514    1,901    4,415    599    8/29/2007
Pueblo CO 156    2,797    16    156    2,813    2,969    375    2/17/2016
Cape Coral-Fort Myers(3) FL 4,122    8,453    55    4,122    8,508    12,630    1,128    4/1/2016
Crestview-Fort Walton Beach-Destin FL 684    12,857    16    684    12,873    13,557    325    1/1/2019
Crestview-Fort Walton Beach-Destin FL 2,001    12,948    3    2,001    12,951    14,952    218    6/21/2019
Crestview-Fort Walton Beach-Destin FL 813    3,509    7    813    3,516    4,329    5    12/17/2019
Crestview-Fort Walton Beach-Destin FL 1,285    5,292    7    1,285    5,299    6,584    9    12/17/2019
Gainesville FL 1,072    4,698    72    1,072    4,770    5,842    387    1/10/2018
Gainesville FL 264    2,369    94    264    2,463    2,727    117    12/18/2018
Gainesville(3) FL 457    2,120    6    457    2,126    2,583    5    12/19/2019
Jacksonville FL 2,087    19,473    157    2,087    19,630    21,717    1,808    11/10/2016
Jacksonville FL 1,629    4,929    315    1,629    5,244    6,873    641    11/10/2016
Jacksonville FL 527    2,434    927    527    3,361    3,888    377    12/20/2017
Lakeland-Winter Haven(3) FL 972    2,159    157    972    2,316    3,288    438    5/4/2015
Naples-Immokalee-Marco Island(3) FL 3,849    16,688    118    3,849    16,806    20,655    1,892    4/1/2016

F-45
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
North Port-Sarasota-Bradenton(3) FL 2,211    5,682    62    2,211    5,744    7,955    737    4/1/2016
North Port-Sarasota-Bradenton(3) FL 2,488    7,282    152    2,488    7,434    9,922    906    4/1/2016
North Port-Sarasota-Bradenton(3) FL 1,767    5,955    22    1,767    5,977    7,744    831    4/1/2016
North Port-Sarasota-Bradenton FL 2,143    5,005    3,863    3,373    8,868    12,241    1,348    10/11/2016
North Port-Sarasota-Bradenton(3) FL 1,924    4,514    278    1,924    4,792    6,716    708    4/1/2016
North Port-Sarasota-Bradenton FL 1,176    3,421    7    1,176    3,428    4,604    443    4/1/2016
North Port-Sarasota-Bradenton(3) FL 1,839    8,377    40    1,839    8,417    10,256    923    4/1/2016
North Port-Sarasota-Bradenton(3) FL 2,507    7,766    56    2,507    7,822    10,329    941    4/1/2016
North Port-Sarasota-Bradenton(3) FL 1,685    5,439    72    1,685    5,511    7,196    726    4/1/2016
North Port-Sarasota-Bradenton(3) FL 437    5,128    206    437    5,334    5,771    728    4/1/2016
North Port-Sarasota-Bradenton FL 1,015    3,031    23    1,015    3,054    4,069    376    4/1/2016
North Port-Sarasota-Bradenton FL 1,985    4,299    892    1,985    5,191    7,176    573    1/31/2017
North Port-Sarasota-Bradenton FL 1,336    4,085    2    1,336    4,087    5,423    354    4/6/2017
North Port-Sarasota-Bradenton FL 2,105    8,217    16    2,105    8,233    10,338    320    1/1/2019
Orlando-Kissimmee-Sanford FL 2,426    9,314    130    2,426    9,444    11,870    1,018    11/10/2016
Orlando-Kissimmee-Sanford FL 2,166    4,672    103    2,166    4,775    6,941    579    11/10/2016
Orlando-Kissimmee-Sanford FL 4,583    8,752    102    4,583    8,854    13,437    1,197    11/10/2016
Orlando-Kissimmee-Sanford FL 4,181    4,268    177    4,181    4,445    8,626    496    6/30/2017
Palm Bay-Melbourne-Titusville FL 1,125    4,362    8    1,125    4,370    5,495    143    1/1/2019
Panama City FL 2,332    6,847    10    2,332    6,857    9,189    136    6/21/2019
Panama City FL 810    3,105    24    810    3,129    3,939    39    8/22/2019
Pensacola-Ferry Pass-Brent FL 1,025    8,157    120    1,025    8,277    9,302    601    10/3/2017
Pensacola-Ferry Pass-Brent FL 841    5,075    233    841    5,308    6,149    411    2/20/2018
Pensacola-Ferry Pass-Brent FL 644    4,785    156    644    4,941    5,585    212    12/12/2018
Pensacola-Ferry Pass-Brent FL 1,182    5,008    4    1,182    5,012    6,194    98    6/21/2019
Punta Gorda(3) FL 1,157    2,079    813    1,157    2,892    4,049    286    4/27/2017
Tampa-St. Petersburg-Clearwater(3) FL 5,436    10,092    43    5,436    10,135    15,571    1,349    4/1/2016
Tampa-St. Petersburg-Clearwater(3) FL 361    1,238    98    361    1,336    1,697    337    5/4/2015
Tampa-St. Petersburg-Clearwater FL 3,581    2,612    57    3,581    2,669    6,250    407    5/1/2017
Tampa-St. Petersburg-Clearwater FL 4,708    13,984    86    4,708    14,070    18,778    1,184    5/24/2017
Tampa-St. Petersburg-Clearwater FL 2,063    5,351    188    2,063    5,539    7,602    248    8/28/2018
Tampa-St. Petersburg-Clearwater FL 1,248    2,937    —    1,248    2,937    4,185    4    12/18/2019
The Villages FL 897    6,132    36    897    6,168    7,065    291    1/1/2019
Atlanta-Sandy Springs-Roswell GA 515    687    111    515    798    1,313    280    8/29/2007
Atlanta-Sandy Springs-Roswell GA 272    1,357    503    272    1,860    2,132    559    8/29/2007

F-46
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Atlanta-Sandy Springs-Roswell GA 702    1,999    532    702    2,531    3,233    821    8/29/2007
Atlanta-Sandy Springs-Roswell GA 1,413    1,590    183    1,413    1,773    3,186    608    8/29/2007
Atlanta-Sandy Springs-Roswell GA 341    562    135    341    697    1,038    267    8/29/2007
Atlanta-Sandy Springs-Roswell GA 553    847    178    553    1,025    1,578    383    8/29/2007
Atlanta-Sandy Springs-Roswell GA 85    445    298    85    743    828    291    9/28/2007
Atlanta-Sandy Springs-Roswell(3) GA 494    2,215    255    494    2,470    2,964    791    9/28/2007
Atlanta-Sandy Springs-Roswell GA 1,614    2,476    1,725    1,614    4,201    5,815    529    7/29/2015
Atlanta-Sandy Springs-Roswell GA 1,595    2,143    2,050    1,595    4,193    5,788    561    7/29/2015
Atlanta-Sandy Springs-Roswell GA 666    5,961    52    666    6,013    6,679    578    7/17/2017
Atlanta-Sandy Springs-Roswell GA 1,028    7,041    56    1,028    7,097    8,125    749    10/19/2017
Atlanta-Sandy Springs-Roswell GA 748    3,382    70    748    3,452    4,200    319    10/19/2017
Atlanta-Sandy Springs-Roswell GA 703    4,014    98    703    4,112    4,815    373    10/19/2017
Atlanta-Sandy Springs-Roswell GA 1,873    9,109    93    1,873    9,202    11,075    773    10/19/2017
Atlanta-Sandy Springs-Roswell GA 547    4,073    50    547    4,123    4,670    367    10/19/2017
Atlanta-Sandy Springs-Roswell GA 1,499    5,279    58    1,499    5,337    6,836    480    10/19/2017
Atlanta-Sandy Springs-Roswell GA 763    5,135    61    763    5,196    5,959    389    10/19/2017
Atlanta-Sandy Springs-Roswell GA 795    2,941    25    600    2,966    3,566    265    10/19/2017
Atlanta-Sandy Springs-Roswell GA 1,356    7,516    23    1,356    7,539    8,895    651    10/19/2017
Atlanta-Sandy Springs-Roswell GA 912    5,074    53    912    5,127    6,039    393    10/19/2017
Atlanta-Sandy Springs-Roswell GA 570    3,477    122    570    3,599    4,169    332    10/19/2017
Atlanta-Sandy Springs-Roswell GA 1,052    7,102    89    1,052    7,191    8,243    540    10/19/2017
Atlanta-Sandy Springs-Roswell GA 430    3,470    53    430    3,523    3,953    527    3/29/2016
Atlanta-Sandy Springs-Roswell GA 972    2,342    56    972    2,398    3,370    320    8/17/2016
Atlanta-Sandy Springs-Roswell GA 919    3,899    63    919    3,962    4,881    249    5/21/2018
Atlanta-Sandy Springs-Roswell GA 520    3,708    28    520    3,736    4,256    138    1/4/2019
Atlanta-Sandy Springs-Roswell GA 765    2,872    29    765    2,901    3,666    110    1/4/2019
Atlanta-Sandy Springs-Roswell GA 686    3,821    25    686    3,846    4,532    119    1/4/2019
Atlanta-Sandy Springs-Roswell GA 527    10,404    3    527    10,407    10,934    133    7/24/2019
Augusta-Richmond County GA 84    539    204    84    743    827    258    8/29/2007
Augusta-Richmond County GA 205    686    182    205    868    1,073    292    8/29/2007
Augusta-Richmond County GA 1,424    10,439    59    1,424    10,498    11,922    310    2/5/2019
Augusta-Richmond County GA 875    6,231    26    875    6,257    7,132    138    5/28/2019
Augusta-Richmond County GA 1,277    7,494    26    1,277    7,520    8,797    182    5/28/2019
Columbus(3) GA 169    342    171    169    513    682    158    5/1/2009
Macon GA 180    840    66    180    906    1,086    287    9/28/2007

F-47
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Savannah GA 1,741    1,160    437    1,741    1,597    3,338    456    8/29/2007
Savannah(3) GA 597    762    168    597    930    1,527    323    9/28/2007
Savannah GA 409    1,335    30    409    1,365    1,774    473    1/31/2014
Savannah GA 811    1,181    157    811    1,338    2,149    482    6/25/2014
Savannah GA 1,280    7,211    69    1,280    7,280    8,560    176    5/15/2019
Valdosta GA 1,321    3,320    4    1,321    3,324    4,645    115    1/1/2019
Nonmetropolitan Area GA 599    3,714    14    599    3,728    4,327    53    8/30/2019
Nonmetropolitan Area ID 1,133    5,634    34    1,133    5,668    6,801    203    4/1/2019
Nonmetropolitan Area ID 362    2,523    4    362    2,527    2,889    59    6/24/2019
Nonmetropolitan Area ID 413    2,114    5    413    2,119    2,532    44    6/24/2019
St. Louis IL 225    4,394    187    225    4,581    4,806    424    8/28/2017
St. Louis IL 179    5,154    335    179    5,489    5,668    519    8/28/2017
St. Louis IL 226    3,088    252    226    3,340    3,566    351    8/28/2017
St. Louis IL 174    3,338    274    174    3,612    3,786    336    9/25/2017
Indianapolis-Carmel-Anderson IN 855    7,273    24    855    7,297    8,152    999    2/16/2016
Indianapolis-Carmel-Anderson IN 815    3,844    13    815    3,857    4,672    655    2/16/2016
Indianapolis-Carmel-Anderson IN 688    3,845    30    688    3,875    4,563    663    2/16/2016
Indianapolis-Carmel-Anderson IN 626    4,049    36    626    4,085    4,711    615    2/25/2016
Indianapolis-Carmel-Anderson IN 1,118    4,444    281    1,118    4,725    5,843    921    2/25/2016
Indianapolis-Carmel-Anderson IN 614    5,487    41    614    5,528    6,142    734    2/25/2016
Indianapolis-Carmel-Anderson IN 619    2,140    20    619    2,160    2,779    391    11/10/2016
Indianapolis-Carmel-Anderson IN 689    6,944    38    689    6,982    7,671    762    11/10/2016
Indianapolis-Carmel-Anderson IN 609    3,172    39    609    3,211    3,820    483    11/10/2016
Indianapolis-Carmel-Anderson IN 532    5,441    34    532    5,475    6,007    592    11/10/2016
Indianapolis-Carmel-Anderson IN 433    5,817    20    433    5,837    6,270    603    11/10/2016
Indianapolis-Carmel-Anderson IN 688    5,413    40    688    5,453    6,141    685    11/10/2016
Indianapolis-Carmel-Anderson IN 575    5,168    65    575    5,233    5,808    615    11/10/2016
Indianapolis-Carmel-Anderson IN 522    5,366    28    522    5,394    5,916    595    11/10/2016
Indianapolis-Carmel-Anderson IN 528    2,877    13    528    2,890    3,418    315    10/19/2017
Indianapolis-Carmel-Anderson IN 1,257    6,694    29    1,257    6,723    7,980    611    10/19/2017
Kansas City KS 816    5,432    133    816    5,565    6,381    524    10/19/2017
Kansas City KS 975    6,967    183    975    7,150    8,125    711    10/19/2017
Kansas City KS 719    5,143    168    719    5,311    6,030    453    10/19/2017
Kansas City(3) KS 521    5,168    176    521    5,344    5,865    360    3/1/2018
Kansas City KS 640    3,367    127    640    3,494    4,134    242    5/31/2018

F-48
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Kansas City KS 533    3,138    98    533    3,236    3,769    213    5/31/2018
Kansas City KS 499    4,041    116    499    4,157    4,656    282    5/31/2018
Kansas City KS 724    4,245    130    724    4,375    5,099    269    5/31/2018
Wichita(3) KS 1,156    5,662    164    1,156    5,826    6,982    428    3/1/2018
Wichita(3) KS 721    3,395    175    721    3,570    4,291    266    3/1/2018
Wichita(3) KS 443    3,635    115    443    3,750    4,193    258    3/1/2018
Wichita KS 630    7,264    123    630    7,387    8,017    418    3/1/2018
Wichita KS 430    1,740    64    430    1,804    2,234    132    3/1/2018
Wichita KS 655    1,831    132    655    1,963    2,618    144    5/31/2018
Wichita KS 393    3,950    142    393    4,092    4,485    270    5/31/2018
Wichita KS 1,353    2,241    130    1,353    2,371    3,724    193    8/28/2018
Louisville/Jefferson County KY 2,174    3,667    42    2,174    3,709    5,883    655    5/1/2015
Baton Rouge LA 386    1,744    114    386    1,858    2,244    270    4/12/2016
Baton Rouge LA 1,098    5,208    530    1,098    5,738    6,836    895    4/12/2016
Baton Rouge LA 1,203    3,156    252    1,203    3,408    4,611    534    7/21/2016
Baton Rouge LA 755    2,702    275    755    2,977    3,732    460    7/21/2016
New Orleans-Metairie LA 1,287    6,235    144    1,287    6,379    7,666    875    4/12/2016
New Orleans-Metairie LA 1,076    6,677    69    1,076    6,746    7,822    520    1/10/2019
New Orleans-Metairie LA 1,274    1,987    40    1,274    2,027    3,301    122    1/10/2019
New Orleans-Metairie LA 994    8,548    21    994    8,569    9,563    232    1/10/2019
New Orleans-Metairie LA 607    9,211    264    607    9,475    10,082    254    1/10/2019
New Orleans-Metairie LA 819    4,291    287    819    4,578    5,397    164    1/10/2019
New Orleans-Metairie LA 327    4,423    61    327    4,484    4,811    133    1/10/2019
New Orleans-Metairie LA 852    4,138    40    852    4,178    5,030    140    1/10/2019
New Orleans-Metairie LA 633    870    31    633    901    1,534    57    1/10/2019
New Orleans-Metairie LA 682    4,790    437    682    5,227    5,909    165    1/10/2019
New Orleans-Metairie LA 773    7,056    47    773    7,103    7,876    196    1/10/2019
New Orleans-Metairie LA 742    3,278    19    742    3,297    4,039    136    1/10/2019
New Orleans-Metairie(4) LA 96    3,615    6    96    3,621    3,717    45    9/18/2019
Shreveport-Bossier City LA 971    3,474    152    1,549    5,036    6,585    737    5/5/2015
Shreveport-Bossier City LA 964    3,573    104    964    3,677    4,641    772    5/5/2015
Shreveport-Bossier City LA 772    2,906    131    772    3,037    3,809    626    5/5/2015
Shreveport-Bossier City LA 479    1,439    71    479    1,510    1,989    331    5/5/2015
Shreveport-Bossier City LA 475    854    85    475    939    1,414    248    5/5/2015
Shreveport-Bossier City LA 645    2,004    70    645    2,074    2,719    307    10/19/2017

F-49
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Shreveport-Bossier City LA 654    3,589    68    654    3,657    4,311    302    10/19/2017
Shreveport-Bossier City LA 906    3,618    56    906    3,674    4,580    334    10/19/2017
Shreveport-Bossier City(4) LA —    5,113    90    —    5,203    5,203    364    10/19/2017
Springfield MA 1,036    5,131    43    1,036    5,174    6,210    66    9/17/2019
Springfield MA 891    4,944    62    891    5,006    5,897    58    9/17/2019
Worchester MA 414    4,122    96    414    4,218    4,632    394    6/30/2017
California-Lexington Park MD 827    4,936    126    827    5,062    5,889    415    2/16/2018
California-Lexington Park MD 965    6,738    144    965    6,882    7,847    745    7/31/2017
California-Lexington Park MD 550    2,409    117    550    2,526    3,076    304    9/6/2017
Washington-Arlington-Alexandria MD 717    3,303    66    717    3,369    4,086    162    1/3/2019
Kansas City MO 541    4,874    203    541    5,077    5,618    356    5/31/2018
Kansas City MO 461    5,341    110    461    5,451    5,912    344    5/31/2018
Kansas City MO 341    3,748    177    341    3,925    4,266    259    5/31/2018
St. Louis MO 1,675    10,606    188    1,675    10,794    12,469    626    9/26/2018
St. Louis MO 352    7,100    274    352    7,374    7,726    732    8/28/2017
St. Louis MO 163    1,025    53    163    1,078    1,241    115    8/28/2017
St. Louis MO 354    4,034    135    354    4,169    4,523    411    8/28/2017
St. Louis MO 634    3,886    3    634    3,889    4,523    6    12/18/2019
St. Louis MO 1,012    3,328    3    1,012    3,331    4,343    6    12/18/2019
Gulfport-Biloxi-Pascagoula MS 645    2,413    275    645    2,688    3,333    595    4/12/2016
Nonmetropolitan Area(3) MS 224    1,052    146    224    1,198    1,422    333    5/1/2009
Nonmetropolitan Area(3) MS 382    803    198    382    1,001    1,383    285    5/1/2009
Charlotte-Concord-Gastonia NC 1,871    4,174    101    1,871    4,275    6,146    758    5/1/2015
Charlotte-Concord-Gastonia(3) NC 1,108    3,935    91    1,108    4,026    5,134    727    5/4/2015
Charlotte-Concord-Gastonia(3) NC 2,301    4,458    230    2,301    4,688    6,989    929    5/4/2015
Charlotte-Concord-Gastonia(3) NC 1,862    3,297    96    1,862    3,393    5,255    701    9/2/2015
Durham-Chapel Hill NC 1,711    4,180    65    1,711    4,245    5,956    679    5/1/2015
Durham-Chapel Hill NC 390    1,025    251    390    1,276    1,666    435    8/29/2007
Durham-Chapel Hill(3) NC 663    2,743    267    663    3,010    3,673    974    9/28/2007
Durham-Chapel Hill NC 1,024    1,383    430    1,024    1,813    2,837    577    9/28/2007
Fayetteville(3) NC 1,195    2,072    26    1,195    2,098    3,293    333    10/1/2015
Fayetteville(3) NC 830    3,710    69    830    3,779    4,609    498    10/1/2015
Fayetteville NC 636    2,169    1,678    636    3,847    4,483    1,199    8/29/2007
Fayetteville(3) NC 151    5,392    479    151    5,871    6,022    1,786    9/28/2007
Fayetteville NC 1,319    3,444    32    1,319    3,476    4,795    748    10/10/2013

F-50
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Fayetteville NC 772    3,406    43    772    3,449    4,221    651    10/10/2013
Fayetteville(3) NC 1,276    4,527    46    1,276    4,573    5,849    793    12/20/2013
Greensboro-High Point NC 873    769    205    873    974    1,847    366    8/29/2007
Jacksonville NC 1,265    2,123    299    1,265    2,422    3,687    593    5/1/2015
Nonmetropolitan Area NC 530    2,394    13    530    2,407    2,937    465    12/11/2014
Nonmetropolitan Area NC 667    2,066    22    667    2,088    2,755    427    12/11/2014
Nonmetropolitan Area(3) NC 689    3,153    39    689    3,192    3,881    575    5/6/2015
Nonmetropolitan Area NC 2,093    2,045    60    2,093    2,105    4,198    300    8/4/2017
Nonmetropolitan Area NC 173    2,193    36    173    2,229    2,402    188    7/17/2018
Raleigh NC 396    1,700    193    396    1,893    2,289    645    8/29/2007
Raleigh NC 393    1,190    218    393    1,408    1,801    462    8/29/2007
Raleigh NC 907    2,913    135    907    3,048    3,955    975    8/29/2007
Raleigh(3) NC 1,578    4,678    99    1,578    4,777    6,355    756    5/4/2015
Wilmington NC 1,881    4,618    62    1,881    4,680    6,561    781    5/1/2015
Wilmington NC 1,283    1,747    338    1,141    2,085    3,226    629    8/29/2007
Wilmington(3) NC 860    828    104    860    932    1,792    301    9/28/2007
Wilmington NC 1,720    9,032    36    1,720    9,068    10,788    333    11/7/2018
Wilmington NC 2,021    8,136    55    2,021    8,191    10,212    327    11/7/2018
Wilmington NC 3,083    12,487    27    3,083    12,514    15,597    427    11/7/2018
Winston-Salem NC 362    529    75    362    604    966    213    8/29/2007
Boston-Cambridge-Newton NH 899    3,863    45    899    3,908    4,807    584    9/22/2015
Boston-Cambridge-Newton NH 1,488    7,300    115    1,488    7,415    8,903    1,641    7/1/2014
Boston-Cambridge-Newton NH 1,597    3,138    93    1,597    3,231    4,828    528    2/22/2016
Boston-Cambridge-Newton NH 1,445    2,957    69    1,445    3,026    4,471    521    2/22/2016
Manchester-Nashua NH 1,786    6,100    27    1,786    6,127    7,913    852    2/22/2016
Manchester-Nashua NH 1,395    5,573    36    1,395    5,609    7,004    722    2/22/2016
Nonmetropolitan Area NH 632    1,040    469    632    1,509    2,141    454    6/24/2013
Nonmetropolitan Area NH 197    901    24    197    925    1,122    355    6/24/2013
Nonmetropolitan Area NH 2,053    5,425    52    2,053    5,477    7,530    605    6/15/2017
Nonmetropolitan Area NH 1,528    2,686    35    1,528    2,721    4,249    519    2/22/2016
Nonmetropolitan Area NH 1,344    4,872    165    1,344    5,037    6,381    175    3/8/2019
New York-Newark-Jersey City NJ 742    3,810    25    742    3,835    4,577    176    3/1/2019
New York-Newark-Jersey City NJ 831    6,318    38    831    6,356    7,187    256    3/1/2019
Vineland-Bridgeton NJ 180    5,831    300    180    6,131    6,311    183    4/15/2019
Albuquerque NM 1,089    2,845    178    1,089    3,023    4,112    590    8/31/2016

F-51
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Albuquerque NM 854    3,436    89    854    3,525    4,379    466    9/19/2016
Albuquerque NM 1,247    2,753    111    1,247    2,864    4,111    90    3/21/2019
Albuquerque NM 2,448    11,065    125    2,448    11,190    13,638    201    5/20/2019
Albuquerque NM 2,386    7,658    77    2,386    7,735    10,121    175    5/20/2019
Carson City NV 985    1,438    391    995    1,829    2,824    122    12/13/2018
Las Vegas-Henderson-Paradise NV 1,757    4,223    77    1,757    4,300    6,057    627    9/20/2016
Las Vegas-Henderson-Paradise NV 1,121    1,510    117    1,121    1,627    2,748    309    9/20/2016
Las Vegas-Henderson-Paradise NV 2,160    4,544    272    2,160    4,816    6,976    521    11/17/2016
Las Vegas-Henderson-Paradise NV 1,047    7,413    347    1,047    7,760    8,807    500    4/11/2018
Las Vegas-Henderson-Paradise NV 1,169    3,616    227    1,169    3,843    5,012    1,391    12/23/2013
Las Vegas-Henderson-Paradise NV 389    2,850    104    389    2,954    3,343    740    4/1/2014
Las Vegas-Henderson-Paradise NV 794    1,406    119    794    1,525    2,319    506    7/1/2014
Las Vegas-Henderson-Paradise NV 2,362    8,445    183    2,362    8,628    10,990    647    8/15/2017
Las Vegas-Henderson-Paradise NV 2,157    2,753    118    2,157    2,871    5,028    308    8/15/2017
Las Vegas-Henderson-Paradise NV 1,296    8,039    227    1,296    8,266    9,562    593    8/15/2017
Las Vegas-Henderson-Paradise NV 828    2,030    275    828    2,305    3,133    274    8/29/2017
Las Vegas-Henderson-Paradise NV 3,864    2,870    1,021    3,976    3,891    7,867    529    8/29/2017
Canton-Massillon OH 83    2,911    48    83    2,959    3,042    375    11/10/2016
Canton-Massillon OH 292    2,107    113    292    2,220    2,512    564    11/10/2016
Cincinnati OH 2,059    11,660    52    2,059    11,712    13,771    636    9/6/2018
Cleveland-Elyria OH 169    2,702    50    169    2,752    2,921    332    11/10/2016
Cleveland-Elyria OH 193    3,323    42    193    3,365    3,558    364    11/10/2016
Cleveland-Elyria OH 490    1,050    26    490    1,076    1,566    209    11/10/2016
Cleveland-Elyria OH 845    4,916    33    845    4,949    5,794    626    11/10/2016
Cleveland-Elyria OH 842    2,044    40    842    2,084    2,926    420    11/10/2016
Oklahoma City OK 388    3,142    233    388    3,375    3,763    1,106    5/29/2007
Oklahoma City OK 213    1,383    106    213    1,489    1,702    493    5/29/2007
Oklahoma City OK 561    2,355    621    561    2,976    3,537    1,065    5/29/2007
Oklahoma City OK 349    2,368    593    349    2,961    3,310    1,050    5/29/2007
Oklahoma City OK 466    2,544    109    466    2,653    3,119    878    5/29/2007
Oklahoma City OK 144    1,576    209    144    1,785    1,929    625    5/29/2007
Oklahoma City OK 168    1,696    297    168    1,993    2,161    685    5/29/2007
Oklahoma City OK 220    1,606    124    220    1,730    1,950    581    5/30/2007
Oklahoma City OK 376    1,460    62    376    1,522    1,898    487    5/30/2007
Oklahoma City OK 337    2,788    95    337    2,883    3,220    943    5/30/2007

F-52
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Oklahoma City OK 814    3,161    1,195    814    4,356    5,170    1,128    5/30/2007
Oklahoma City OK 590    1,502    1,814    590    3,316    3,906    985    8/29/2007
Oklahoma City OK 205    1,772    603    205    2,375    2,580    800    5/1/2009
Oklahoma City OK 701    4,926    3    701    4,929    5,630    536    9/1/2016
Oklahoma City OK 1,082    4,218    20    1,082    4,238    5,320    594    1/1/2016
Oklahoma City OK 736    2,925    6    736    2,931    3,667    500    1/1/2016
Oklahoma City OK 1,135    3,759    18    1,135    3,777    4,912    559    1/1/2016
Tulsa OK 548    1,892    112    548    2,004    2,552    641    8/29/2007
Tulsa OK 764    1,386    441    764    1,827    2,591    624    8/29/2007
Tulsa OK 1,305    2,533    172    1,305    2,705    4,010    881    8/29/2007
Tulsa OK 940    2,196    353    940    2,549    3,489    834    8/29/2007
Tulsa OK 59    466    378    59    844    903    284    8/29/2007
Tulsa OK 426    1,424    299    426    1,723    2,149    626    8/29/2007
Tulsa OK 250    667    257    250    924    1,174    302    8/29/2007
Tulsa(3) OK 944    2,085    59    944    2,144    3,088    653    2/14/2008
Tulsa(3) OK 892    2,421    30    892    2,451    3,343    743    2/14/2008
Tulsa OK 492    1,343    198    492    1,541    2,033    443    4/1/2008
Tulsa OK 505    1,346    731    505    2,077    2,582    815    4/1/2008
Tulsa OK 466    1,270    157    466    1,427    1,893    447    4/1/2008
Tulsa(3) OK 1,103    4,431    457    1,103    4,888    5,991    1,923    6/10/2013
Bend-Redmond OR 295    1,369    65    295    1,434    1,729    471    4/1/2013
Bend-Redmond OR 1,692    2,410    67    1,692    2,477    4,169    957    4/1/2013
Bend-Redmond(3) OR 571    1,917    9    571    1,926    2,497    509    6/10/2013
Bend-Redmond(3) OR 397    1,180    133    397    1,313    1,710    534    6/10/2013
Bend-Redmond OR 690    1,983    853    690    2,836    3,526    622    5/1/2014
Bend-Redmond OR 722    2,151    8    722    2,159    2,881    538    5/1/2014
Bend-Redmond OR 800    2,836    8    800    2,844    3,644    708    5/1/2014
Bend-Redmond OR 2,688    10,731    102    2,688    10,833    13,521    1,492    4/15/2016
Corvallis OR 382    1,465    48    382    1,513    1,895    469    12/30/2013
Eugene OR 710    1,539    102    710    1,641    2,351    531    4/1/2013
Eugene OR 842    1,674    46    842    1,720    2,562    593    4/1/2013
Eugene(3) OR 414    1,990    8    414    1,998    2,412    451    6/10/2013
Eugene(3) OR 1,149    2,061    73    1,149    2,134    3,283    572    6/10/2013
Eugene OR 728    3,230    151    728    3,381    4,109    693    12/30/2013
Eugene OR 1,601    2,686    154    1,601    2,840    4,441    1,016    4/1/2014

F-53
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Nonmetropolitan Area OR 997    1,874    16    997    1,890    2,887    402    12/1/2014
Portland-Vancouver-Hillsboro OR 2,670    8,709    81    2,670    8,790    11,460    1,044    8/10/2015
Portland-Vancouver-Hillsboro OR 771    4,121    5    771    4,126    4,897    287    11/15/2017
Portland-Vancouver-Hillsboro OR 2,002    14,445    35    2,002    14,480    16,482    1,195    12/14/2017
Portland-Vancouver-Hillsboro OR 851    2,063    21    851    2,084    2,935    504    4/1/2013
Portland-Vancouver-Hillsboro OR 1,704    2,313    196    1,704    2,509    4,213    795    4/1/2013
Portland-Vancouver-Hillsboro OR 1,254    2,787    64    1,254    2,851    4,105    687    4/1/2013
Portland-Vancouver-Hillsboro OR 2,808    4,437    29    2,808    4,466    7,274    1,292    4/1/2013
Portland-Vancouver-Hillsboro OR 1,015    2,184    8    1,015    2,192    3,207    560    4/1/2013
Portland-Vancouver-Hillsboro(3) OR 1,077    3,008    180    1,077    3,188    4,265    709    6/10/2013
Portland-Vancouver-Hillsboro(3) OR 1,072    2,629    87    1,072    2,716    3,788    731    6/10/2013
Portland-Vancouver-Hillsboro(3) OR 2,217    3,766    25    2,217    3,791    6,008    883    6/10/2013
Portland-Vancouver-Hillsboro(3) OR 1,334    2,324    138    1,334    2,462    3,796    674    6/10/2013
Portland-Vancouver-Hillsboro(3) OR 996    2,525    178    996    2,703    3,699    712    6/10/2013
Portland-Vancouver-Hillsboro OR 1,496    3,372    242    1,496    3,614    5,110    788    6/24/2013
Portland-Vancouver-Hillsboro OR 954    3,026    141    954    3,167    4,121    640    6/24/2013
Portland-Vancouver-Hillsboro OR 1,627    2,388    97    1,627    2,485    4,112    615    6/24/2013
Portland-Vancouver-Hillsboro OR 2,509    4,200    135    2,509    4,335    6,844    1,062    12/30/2013
Portland-Vancouver-Hillsboro OR 787    1,915    81    787    1,996    2,783    453    12/30/2013
Portland-Vancouver-Hillsboro OR 1,703    4,729    44    1,703    4,773    6,476    980    4/1/2014
Portland-Vancouver-Hillsboro OR 738    2,483    7    738    2,490    3,228    515    4/1/2014
Portland-Vancouver-Hillsboro OR 1,690    2,995    180    1,690    3,175    4,865    513    4/1/2014
Portland-Vancouver-Hillsboro OR 1,200    9,531    293    1,200    9,824    11,024    2,781    5/30/2014
Portland-Vancouver-Hillsboro OR 401    3,718    94    401    3,812    4,213    879    5/30/2014
Portland-Vancouver-Hillsboro OR 1,160    3,291    34    1,160    3,325    4,485    740    6/30/2014
Portland-Vancouver-Hillsboro OR 1,435    4,342    21    1,435    4,363    5,798    974    6/30/2014
Portland-Vancouver-Hillsboro OR 1,478    4,127    14    1,478    4,141    5,619    918    6/30/2014
Portland-Vancouver-Hillsboro OR 1,402    3,196    41    1,402    3,237    4,639    683    6/30/2014
Portland-Vancouver-Hillsboro OR 3,538    4,938    29    3,398    4,007    7,405    885    6/30/2014
Portland-Vancouver-Hillsboro OR 1,501    3,136    27    1,501    3,163    4,664    698    6/30/2014
Portland-Vancouver-Hillsboro OR 1,746    3,393    33    1,746    3,426    5,172    772    8/27/2014
Portland-Vancouver-Hillsboro OR 1,014    3,017    28    1,014    3,045    4,059    711    8/27/2014
Portland-Vancouver-Hillsboro OR 2,202    3,477    194    2,202    3,671    5,873    859    10/20/2014
Portland-Vancouver-Hillsboro OR 1,764    7,360    30    1,764    7,390    9,154    1,375    12/16/2014
Portland-Vancouver-Hillsboro OR 860    3,740    4    860    3,744    4,604    363    1/11/2017

F-54
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Portland-Vancouver-Hillsboro OR 410    622    182    410    804    1,214    144    7/14/2016
Portland-Vancouver-Hillsboro OR 1,258    6,298    12    1,258    6,310    7,568    578    11/21/2016
Portland-Vancouver-Hillsboro OR 2,334    7,726    63    2,339    7,789    10,128    879    12/6/2016
Portland-Vancouver-Hillsboro OR 1,048    3,549    30    1,048    3,579    4,627    237    8/16/2018
Nonmetropolitan Area OR 427    1,648    8    427    1,656    2,083    363    8/27/2014
Nonmetropolitan Area(3) OR 474    1,789    107    474    1,896    2,370    507    6/10/2013
Salem OR 472    2,880    4    472    2,884    3,356    115    10/24/2018
Salem OR 1,405    2,650    430    1,405    3,080    4,485    969    4/1/2014
Salem OR 492    1,248    70    492    1,318    1,810    249    4/20/2016
Salem OR 408    2,221    55    408    2,276    2,684    91    2/1/2019
Nonmetropolitan Area OR 1,108    2,100    8    1,108    2,108    3,216    486    12/5/2014
Lancaster PA 1,393    6,642    3    1,393    6,645    8,038    247    3/1/2019
Lancaster PA 712    3,821    3    712    3,824    4,536    154    3/1/2019
Lancaster PA 599    4,712    3    599    4,715    5,314    128    3/1/2019
Lancaster PA 520    2,135    16    520    2,151    2,671    70    3/1/2019
Philadelphia-Camden-Wilmington PA 625    7,377    235    625    7,612    8,237    207    4/15/2019
York-Hanover PA 586    3,266    14    586    3,280    3,866    154    3/1/2019
Ponce PR 745    4,813    8    745    4,821    5,566    292    9/6/2018
San Juan-Carolina-Caguas PR 1,095    8,073    21    1,095    8,094    9,189    375    9/6/2018
San Juan-Carolina-Caguas PR 1,205    9,967    80    1,205    10,047    11,252    402    9/6/2018
San Juan-Carolina-Caguas PR 1,266    15,805    40    1,266    15,845    17,111    544    9/6/2018
San Juan-Carolina-Caguas PR 356    1,892    32    356    1,924    2,280    117    9/6/2018
San Juan-Carolina-Caguas PR 573    2,373    268    573    2,641    3,214    165    9/6/2018
Charlotte-Concord-Gastonia SC 924    3,086    71    924    3,157    4,081    543    5/4/2015
Greenville-Anderson-Mauldin SC 82    838    179    82    1,017    1,099    317    8/29/2007
Greenville-Anderson-Mauldin SC 92    976    140    92    1,116    1,208    387    8/29/2007
Spartanburg SC 535    1,934    35    535    1,969    2,504    363    11/12/2015
Amarillo(3) TX 80    877    113    80    990    1,070    287    5/1/2009
Amarillo(3) TX 78    697    166    78    863    941    261    5/1/2009
Amarillo(3) TX 147    810    154    147    964    1,111    280    5/1/2009
Austin-Round Rock TX 936    6,446    199    692    6,645    7,337    442    10/19/2017
Austin-Round Rock TX 937    5,319    104    937    5,423    6,360    1,100    6/24/2013
Austin-Round Rock TX 1,395    2,790    35    1,395    2,825    4,220    892    6/24/2013
Austin-Round Rock TX 768    1,923    296    768    2,219    2,987    515    10/29/2014
Austin-Round Rock TX 1,783    17,579    37    1,783    17,616    19,399    395    6/7/2019

F-55
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Austin-Round Rock TX 605    8,703    20    605    8,723    9,328    160    6/7/2019
Brownsville-Harlingen TX 845    2,364    76    845    2,440    3,285    464    9/4/2014
Brownsville-Harlingen TX 639    1,674    115    639    1,789    2,428    415    9/4/2014
Brownsville-Harlingen TX 386    2,798    212    386    3,010    3,396    460    5/2/2016
College Station-Bryan TX 618    2,512    141    618    2,653    3,271    823    8/29/2007
College Station-Bryan TX 551    349    282    551    631    1,182    209    8/29/2007
College Station-Bryan TX 295    988    185    295    1,173    1,468    340    4/1/2008
College Station-Bryan TX 51    123    80    51    203    254    73    4/1/2008
College Station-Bryan TX 110    372    194    110    566    676    154    4/1/2008
College Station-Bryan TX 62    208    26    62    234    296    70    4/1/2008
Dallas-Fort Worth-Arlington TX 164    865    53    164    918    1,082    299    8/29/2007
Dallas-Fort Worth-Arlington TX 155    105    55    155    160    315    64    9/28/2007
Dallas-Fort Worth-Arlington TX 98    282    199    98    481    579    166    9/28/2007
Dallas-Fort Worth-Arlington TX 264    106    167    264    273    537    123    9/28/2007
Dallas-Fort Worth-Arlington(3) TX 376    803    132    376    935    1,311    326    9/28/2007
Dallas-Fort Worth-Arlington(3) TX 338    681    106    338    787    1,125    259    9/28/2007
Dallas-Fort Worth-Arlington TX 1,388    4,195    60    1,388    4,255    5,643    985    6/24/2013
Dallas-Fort Worth-Arlington TX 1,859    5,293    146    1,859    5,439    7,298    1,212    7/25/2013
Dallas-Fort Worth-Arlington TX 379    2,212    143    379    2,355    2,734    744    7/25/2013
Dallas-Fort Worth-Arlington TX 1,397    5,250    98    1,397    5,348    6,745    1,126    7/25/2013
Dallas-Fort Worth-Arlington TX 2,102    5,755    110    2,102    5,865    7,967    1,421    7/25/2013
Dallas-Fort Worth-Arlington TX 649    1,637    63    649    1,700    2,349    690    7/25/2013
Dallas-Fort Worth-Arlington TX 396    1,411    482    396    1,893    2,289    554    4/29/2015
Dallas-Fort Worth-Arlington TX 1,263    3,346    54    1,263    3,400    4,663    765    10/19/2015
Dallas-Fort Worth-Arlington TX 1,421    2,349    529    1,421    2,878    4,299    547    6/1/2016
Dallas-Fort Worth-Arlington TX 710    3,578    142    710    3,720    4,430    395    10/19/2017
Dallas-Fort Worth-Arlington TX 421    2,668    178    421    2,846    3,267    269    10/19/2017
El Paso TX 338    1,275    45    338    1,320    1,658    424    8/29/2007
El Paso TX 94    400    170    94    570    664    194    8/29/2007
Houston-The Woodlands-Sugar Land TX 698    2,648    282    698    2,930    3,628    541    7/20/2015
Houston-The Woodlands-Sugar Land TX 1,042    3,061    482    1,042    3,543    4,585    637    1/22/2016
Houston-The Woodlands-Sugar Land TX 1,426    2,910    132    1,426    3,042    4,468    385    6/13/2017
Houston-The Woodlands-Sugar Land TX 826    3,683    239    826    3,922    4,748    385    1/4/2018
Houston-The Woodlands-Sugar Land TX 649    4,077    73    649    4,150    4,799    385    1/4/2018
Houston-The Woodlands-Sugar Land TX 291    4,980    12    291    4,992    5,283    102    5/7/2019

F-56
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Houston-The Woodlands-Sugar Land TX 539    2,664    14    539    2,678    3,217    57    6/7/2019
Houston-The Woodlands-Sugar Land TX 4,004    4,991    51    4,004    5,042    9,046    174    6/7/2019
Houston-The Woodlands-Sugar Land TX 2,959    5,875    65    2,959    5,940    8,899    145    6/7/2019
Houston-The Woodlands-Sugar Land TX 799    4,769    51    799    4,820    5,619    98    6/7/2019
Houston-The Woodlands-Sugar Land TX 687    3,668    36    687    3,704    4,391    85    6/7/2019
Houston-The Woodlands-Sugar Land TX 295    2,403    65    295    2,468    2,763    48    6/7/2019
Killeen-Temple TX 203    4,065    254    203    4,319    4,522    427    2/2/2017
Killeen-Temple TX 1,128    6,149    229    1,128    6,378    7,506    606    8/8/2017
Killeen-Temple TX 721    4,166    1    721    4,167    4,888    7    12/13/2019
Longview(3) TX 651    671    109    651    780    1,431    228    5/1/2009
Longview(3) TX 104    489    167    104    656    760    184    5/1/2009
Longview(3) TX 310    966    207    310    1,173    1,483    332    5/1/2009
Longview TX 2,466    3,559    214    2,466    3,773    6,239    764    6/19/2014
McAllen–Edinburg–Mission  TX 1,217    2,738    295    1,243    3,033    4,276    888    7/31/2014
McAllen–Edinburg–Mission  TX 1,973    4,517    91    1,973    4,608    6,581    1,070    9/4/2014
McAllen–Edinburg–Mission  TX 1,295    3,929    98    1,295    4,027    5,322    918    9/4/2014
McAllen–Edinburg–Mission  TX 3,079    7,574    116    3,079    7,690    10,769    1,885    9/4/2014
McAllen–Edinburg–Mission  TX 1,017    3,261    85    1,017    3,346    4,363    750    9/4/2014
McAllen–Edinburg–Mission  TX 803    2,914    96    803    3,010    3,813    550    9/4/2014
McAllen–Edinburg–Mission  TX 2,249    4,966    74    2,249    5,040    7,289    1,202    9/4/2014
McAllen–Edinburg–Mission  TX 1,118    3,568    97    1,118    3,665    4,783    704    9/4/2014
Midland(3) TX 691    1,588    171    691    1,759    2,450    493    5/1/2009
Nonmetropolitan Area TX 959    1,640    59    959    1,699    2,658    377    6/25/2014
Odessa(3) TX 168    561    121    168    682    850    200    5/1/2009
San Angelo(3) TX 381    986    106    381    1,092    1,473    302    5/1/2009
San Antonio-New Braunfels TX 614    2,640    81    614    2,721    3,335    710    4/1/2014
San Antonio-New Braunfels TX 715    4,566    87    715    4,653    5,368    418    10/19/2017
San Antonio-New Braunfels TX 275    4,893    141    275    5,034    5,309    88    6/7/2019
Washington-Arlington-Alexandria VA 1,516    12,633    71    1,516    12,704    14,220    945    7/21/2017
Nonmetropolitan Area(3) WA 810    1,530    16    810    1,546    2,356    663    6/10/2013
Nonmetropolitan Area(3) WA 998    1,862    115    998    1,977    2,975    823    6/10/2013
Longview WA 448    2,356    17    448    2,373    2,821    408    9/3/2015
Portland-Vancouver-Hillsboro WA 421    2,313    12    421    2,325    2,746    544    4/1/2013
Portland-Vancouver-Hillsboro WA 1,903    2,239    8    1,903    2,247    4,150    660    4/1/2013
Portland-Vancouver-Hillsboro(3) WA 923    2,821    15    923    2,836    3,759    656    6/10/2013

F-57
Table of Contents
Location Initial Cost to Company Gross Carrying Amount at Year-End
MSA(1)
State/Territory Land
Buildings and
Improvements
Subsequent
Additions
Land
Buildings and
Improvements
Total(2)
Accumulated
Depreciation
Date
Acquired
Portland-Vancouver-Hillsboro WA 935    2,045    12    935    2,057    2,992    448    4/1/2014
Portland-Vancouver-Hillsboro WA 478    2,158    173    478    2,331    2,809    558    4/1/2014
Portland-Vancouver-Hillsboro WA 2,023    3,484    48    2,023    3,532    5,555    889    8/27/2014
Portland-Vancouver-Hillsboro WA 1,870    4,632    7    1,870    4,639    6,509    557    1/11/2017
Portland-Vancouver-Hillsboro WA 422    2,271    8    422    2,279    2,701    156    3/29/2018
Portland-Vancouver-Hillsboro WA 1,105    2,121    19    1,105    2,140    3,245    461    10/3/2014
Seattle-Tacoma-Bellevue WA 770    3,203    35    770    3,238    4,008    817    4/1/2014
Seattle-Tacoma-Bellevue WA 1,438    3,280    65    1,438    3,345    4,783    798    9/18/2014
Total $ 649,872    $ 2,347,378    $ 93,953    $ 649,938    $ 2,441,781    $ 3,091,719    $ 337,822   
(1) Refers to metropolitan statistical area (MSA) as defined by the U.S. Census Bureau.
(2) The aggregate cost of land and depreciable property for Federal income tax purposes was approximately $2.7 billion (unaudited) at December 31, 2019.
(3) As of December 31, 2019, 94 of our self storage properties were encumbered by an aggregate of $264.3 million of debt financing.
(4) Property subject to a long-term lease agreement.
Note: The Company only owns one class of real estate, which is self storage properties. The estimated useful lives of the individual assets that comprise buildings and improvements range from 3 years to 40 years. The category for buildings and improvements in the table above includes furniture and equipment.



F-58
Table of Contents
NATIONAL STORAGE AFFILIATES TRUST
SCHEDULE III-REAL ESTATE AND ACCUMULATED DEPRECIATION
For the Years Ended December 31, 2019, 2018 and 2017
(in thousands)

2019 2018 2017
Self Storage properties:
Balance at beginning of year $ 2,637,723    $ 2,275,233    $ 1,844,336   
Acquisitions and improvements
458,132    366,522    431,542   
Reclassification from assets held for sale —    —    8,607   
Write-off of fully depreciated assets and other
—    (323)   (50)  
Dispositions (4,136)   (3,709)   (7,336)  
Reclassification to assets held for sale —    —    (1,866)  
Balance at end of year $ 3,091,719    $ 2,637,723    $ 2,275,233   
Accumulated depreciation:
Balance at beginning of year $ 246,261    $ 170,358    $ 110,803   
Depreciation expense 92,177    76,299    60,522   
Write-off of fully depreciated assets and other
—    —    (10)  
Dispositions (616)   (396)   (646)  
Assets held for sale —    —    (311)  
Balance at end of year $ 337,822    $ 246,261    $ 170,358   


F-59

Exhibit 4.3
Description of the Registrant’s Securities
Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
Unless otherwise specified or the context requires otherwise, the terms “company,” “we,” “us” and “our” refer to National Storage Affiliates Trust, a Maryland real estate investment trust, together with its subsidiaries.
The following summary of the material terms of our common shares of beneficial interest, par value $0.01 per share (“common shares”), and our 6.000% Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01 per share (“Series A preferred shares”), does not purport to be complete and is subject to and qualified in its entirety by reference to the Maryland REIT Law (the “MRL”), our declaration of trust, which we refer to as our declaration of trust, and our second amended and restated bylaws, which we refer to as our bylaws. Copies of our declaration of trust and bylaws are filed as exhibits to the Annual Report on Form 10-K to which this exhibit is a part.
General
Our declaration of trust provides that we may issue up to 250,000,000 common shares, and up to 50,000,000 preferred shares of beneficial interest, par value $0.01 per share (“preferred shares”), of which 23,369,566 are classified and designated as Series A preferred shares. Our declaration of trust authorizes our board of trustees to amend our declaration of trust to increase or decrease the aggregate number of common shares or the number of shares of any class or series that we are authorized to issue with the approval of a majority of our entire board of trustees and without common shareholder approval. Under Maryland law, our shareholders are not generally liable for our debts or obligations.
Description of Common Shares of Beneficial Interest
All of our outstanding common shares are duly authorized, validly issued, fully paid and nonassessable. Subject to the preferential rights, if any, of holders of any other class or series of our shares, including our Series A preferred shares, and to the provisions of our declaration of trust regarding the restrictions on ownership and transfer of our shares, holders of our common shares are entitled to receive distributions out of assets legally available therefor if, as and when authorized by our board of trustees and declared by us and share ratably in our assets legally available for distribution to our shareholders in the event of our liquidation, dissolution or winding up after payment of or adequate provision for all of our known debts and liabilities.
Subject to the provisions of our declaration of trust regarding the restrictions on ownership and transfer of our shares and except as may otherwise be specified in the terms of any class or series of our shares, each outstanding common share entitles the holder to one vote on all matters submitted to a vote of shareholders, including the election of trustees, and the holders of common shares will possess the exclusive voting power.
We have a majority voting and trustee resignation policy in place. Under majority voting, to be elected as a trustee in an uncontested election, a nominee must receive votes “FOR” his or her election constituting a majority of the total votes cast for and against such nominee at the annual meeting at which a quorum is present. If an incumbent trustee does not receive sufficient “FOR” votes to be re-elected, Maryland law provides that the trustee would continue to serve on the Company’s board of trustees as a “holdover” trustee. Under our bylaws and Corporate Governance Guidelines, he or she must submit his or her resignation to our board of trustees. Our Compensation, Nominating and Corporate Governance Committee will consider such tendered resignation and recommend to our board of trustees whether to accept it. Our board of trustees will decide whether to accept any such resignation within 90 days after certification of the election results and will publicly disclose its decision. If the resignation is not accepted, the trustee will continue to serve until the trustee’s successor is duly elected and qualifies or until the trustee’s earlier death, resignation, retirement or removal. If a trustee’s offer to resign is accepted by the Company’s board of trustees, or if a nominee for trustee is not elected and the nominee is not an incumbent trustee, then the Company’s board of trustees, in its sole discretion, may fill any resulting vacancy pursuant to our bylaws. In a contested election, trustees shall be elected by a plurality of all the votes cast at a meeting of shareholders duly called and at which a quorum is present. A majority of the votes cast at a meeting of shareholders duly called and at which a quorum is present is required to approve any other matter which may properly come before the meeting, unless otherwise provided by statute, our declaration of trust or our bylaws. Unless otherwise provided by statute or





our declaration of trust, each outstanding share of beneficial interest, regardless of class, entitles the holder thereof to cast one vote on each matter submitted to a vote at a meeting of shareholders.
Under the MRL, a Maryland real estate investment trust generally cannot amend its declaration of trust, or merge with or convert into another entity, unless the action is advised by its board of trustees and approved by the affirmative vote of shareholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter, unless a lesser percentage (but not less than a majority of all of the votes entitled to be cast on the matter) is specified in the declaration of trust. Our declaration of trust provides that these actions, as well as consolidations with other entities, certain sales of all or substantially all of our assets and our dissolution, may be approved by shareholders entitled to cast a majority of all of the votes entitled to be cast on the matter, except that amendments to the provisions of our declaration of trust related to the removal of trustees and the restrictions on ownership and transfer of our shares, and the vote required to amend such provisions, must be approved by the affirmative vote of shareholders entitled to cast at least two-thirds of the votes entitled to be cast on the amendment. Our declaration of trust also permits us to transfer all or substantially all of our assets to an entity without the approval of our shareholders if all of the equity interests of the entity are owned, directly or indirectly, by us.
Holders of common shares have no preference, conversion, exchange, sinking fund, redemption or appraisal rights and have no preemptive rights to subscribe for any of our securities. Subject to the restrictions on ownership and transfer of shares contained in our declaration of trust and the terms of any class or series of common shares, all of our common shares will have equal dividend, liquidation and other rights.
Our common shares are traded on the NYSE under the symbol “NSA.”
The transfer agent and registrar for our common shares is Broadridge Financial Solutions, Inc.
Description of Series A Preferred Shares of Beneficial Interest
Ranking
The Series A preferred shares rank, with respect to dividend rights and rights upon voluntary or involuntary liquidation, dissolution or winding up of our affairs:
•senior to all classes or series of our common shares and all other classes or series of our equity shares expressly designated as ranking junior to the Series A preferred shares as to dividend rights and rights upon our voluntary or involuntary liquidation, dissolution or winding up;
•on parity with any class or series of our equity shares expressly designated as ranking on parity with the Series A preferred shares as to dividend rights and rights upon our voluntary or involuntary liquidation, dissolution or winding up; and
•junior to any class or series of our equity shares expressly designated as ranking senior to the Series A preferred shares as to dividend rights and rights upon our voluntary or involuntary liquidation, dissolution or winding up, none of which exists on the date hereof.
The term “equity shares” includes our shares of beneficial interest of all classes or series but does not include convertible or exchangeable debt securities, which, prior to conversion or exchange, rank senior in right of payment to the Series A preferred shares. The Series A preferred shares also rank junior in right of payment to our other existing and future debt obligations.
Dividends
Subject to the preferential rights of the holders of any class or series of our equity shares ranking senior to the Series A preferred shares with respect to dividend rights, none of which exist as of the date hereof, holders of the Series A preferred shares are entitled to receive, when, as and if authorized by our board of trustees and declared by us out of funds legally available for the payment of dividends, cumulative cash dividends at the rate of 6.000% per annum of the $25.00 liquidation preference per share of the Series A preferred shares (equivalent to the fixed annual amount of $1.50 per share of the Series A preferred shares).
Dividends on the Series A preferred shares will accrue and be cumulative from and including the date of original issue of any Series A preferred shares and will be payable to holders quarterly in arrears on or about the last day of March, June, September and December of each year or, if such day is not a business day, on either the immediately

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preceding business day or next succeeding business day at our option, except that, if such business day is in the next succeeding year, such payment shall be made on the immediately preceding business day, in each case with the same force and effect as if made on such date. The term “business day” means any day, other than a Saturday or a Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City are authorized or required by law, regulation or executive order to close.
The amount of any dividend payable on the Series A preferred shares for any period greater or less than a full dividend period will be prorated and computed on the basis of a 360-day year consisting of twelve 30-day months. A dividend period is the respective period commencing on and including the first day of January, April, July and October of each year and ending on and including the day preceding the first day of the next succeeding dividend period (other than the initial dividend period and the dividend period during which any Series A preferred shares shall be redeemed). Dividends will be payable to holders of record as they appear in our share records at the close of business on the applicable record date, which shall be the date designated by our board of trustees as the record date for the payment of dividends that is not more than 35 and not fewer than 10 days prior to the scheduled dividend payment date.
Dividends on the Series A preferred shares will accrue whether or not:
•we have earnings;
•there are funds legally available for the payment of those dividends; or
•those dividends are authorized or declared.
Unless full cumulative dividends on the Series A preferred shares for all past dividend periods shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof is set apart for payment, we will not:
•declare and pay or declare and set aside for payment any dividends, or declare and make any distribution of cash or other property, directly or indirectly, on or with respect to any of our common shares or any other class or series of our equity shares ranking, as to dividends, on parity with or junior to the Series A preferred shares, for any period; or
•redeem, purchase or otherwise acquire for any consideration, or make any other distribution of cash or other property, directly or indirectly, on or with respect to, or pay or make available any monies for a sinking fund for the redemption of, any common shares or any other class or series of our equity shares ranking, as to dividends and the distribution of assets upon liquidation, on parity with or junior to the Series A preferred shares.
The restrictions described in the foregoing sentence, however, will not prohibit:
•dividends payable solely in common shares or any other class or series of equity shares ranking junior to the Series A preferred shares as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up;
•a conversion into or exchange of any of our equity shares for any class or series of equity shares ranking junior to the Series A preferred shares as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up;
•a redemption, purchase or other acquisition of common shares made for purposes of and in compliance with the requirements of an employee incentive or employee benefit plan of our company or any of its subsidiaries;
•a redemption, purchase or other acquisition of any equity shares pursuant to the provisions of our declaration of trust intended to, among other purposes, preserve our status as a REIT as discussed under “Restrictions on Ownership and Transfer”; and
•our purchase or acquisition of Series A preferred shares or parity preferred shares (which are shares of any other class or series ranking on parity with the Series A preferred shares with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up and upon which like

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voting rights have been conferred and are exercisable) pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding Series A preferred shares.
When we do not pay dividends in full (or do not declare and set apart a sum sufficient to pay them in full) on the Series A preferred shares and any other class or series of equity shares ranking, as to dividends, on parity with the Series A preferred shares, we will declare any dividends upon the Series A preferred shares and each such other class or series of equity shares ranking, as to dividends, on parity with the Series A preferred shares (which shall not include the redemption or repurchase of any such class or series) pro rata, so that the amount of dividends declared per series A preferred share and per share of such other class or series will in all cases bear to each other the same ratio that accrued and unpaid dividends per share on the Series A preferred shares and such other class or series of equity shares (which will not include any accrual in respect of unpaid dividends on such other class or series of equity shares for prior dividend periods if such other class or series of equity shares do not have a cumulative dividend) bear to each other. No interest, or sum of money in lieu of interest, will be payable in respect of any dividend payment or payments on the Series A preferred shares which may be in arrears.
Holders of Series A preferred shares are not entitled to any dividend, whether payable in cash, property or equity shares, in excess of full cumulative dividends on the Series A preferred shares as described above. Any dividend payment made on the Series A preferred shares will first be credited against the earliest accrued but unpaid dividends due with respect to those shares which remain payable. Accrued but unpaid dividends on the Series A preferred shares will accumulate as of the dividend payment date on which they first become payable.
We may not declare dividends on the Series A preferred shares, or pay or set apart for payment dividends on the Series A preferred shares, if the terms of any of our agreements, including any agreements relating to our indebtedness, prohibit such a declaration, payment or setting apart for payment or provide that such declaration, payment or setting apart for payment would constitute a breach of or default under such an agreement. Likewise, no dividends will be authorized by our board of trustees and declared by us or paid or set apart for payment if such authorization, declaration or payment is restricted or prohibited by law.
Liquidation Preference
Upon any voluntary or involuntary liquidation, dissolution or winding up of our affairs, before any distribution or payment shall be made to holders of our common shares or any other class or series of equity shares ranking, as to rights upon any voluntary or involuntary liquidation, dissolution or winding up of our affairs, junior to the Series A preferred shares, holders of Series A preferred shares will be entitled to be paid out of our assets legally available for distribution to our shareholders, after payment of or provision for our debts and other liabilities, a liquidation preference of $25.00 per share of Series A preferred shares, plus an amount equal to any accrued and unpaid dividends (whether or not authorized or declared) up to but excluding the date of payment. If, upon our voluntary or involuntary liquidation, dissolution or winding up, our available assets are insufficient to pay the full amount of the liquidating distributions on all outstanding Series A preferred shares and the corresponding amounts payable on each other class or series of equity shares ranking, as to rights upon liquidation, dissolution or winding up, on parity with the Series A preferred shares in the distribution of assets, then holders of Series A preferred shares and each such other class or series of equity shares ranking, as to rights upon any voluntary or involuntary liquidation, dissolution or winding up, on parity with the Series A preferred shares will share ratably in any distribution of assets in proportion to the full liquidating distributions to which they would otherwise be respectively entitled.
Holders of record of Series A preferred shares will be entitled to written notice of any distribution in connection with any voluntary or involuntary liquidation, dissolution or winding up of our affairs not less than 30 days and not more than 60 days prior to the distribution payment date. After payment of the full amount of the liquidating distributions to which they are entitled, holders of Series A preferred shares will have no right or claim to any of our remaining assets. Our consolidation or merger with or into or our conversion into any other corporation, trust or other entity, or the voluntary sale, lease, transfer or conveyance of all or substantially all of our property or business, will not be deemed to constitute a liquidation, dissolution or winding up of our affairs.
In determining whether a distribution (other than upon voluntary or involuntary liquidation), by dividend, redemption or other acquisition of our equity shares or otherwise, is permitted under Maryland law, amounts that would be needed, if we were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of holders of Series A preferred shares will not be added to our total liabilities.

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Optional Redemption
Except with respect to the special optional redemption described below, to preserve our status as a REIT or in certain other limited circumstances relating to our maintenance of our ability to qualify as a REIT as described in “Restrictions on Ownership and Transfer,” we cannot redeem the Series A preferred shares prior to October 11, 2022. On and after October 11, 2022, we may, at our option, upon not fewer than 30 and not more than 60 days’ written notice, redeem the Series A preferred shares, in whole or in part, at any time or from time to time, for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends thereon (whether or not authorized or declared) up to but excluding the date fixed for redemption (other than any dividend with a record date before the applicable redemption date and a payment date after the applicable redemption date, which will be paid on the payment date notwithstanding prior redemption of such shares), without interest, to the extent we have funds legally available for that purpose. We may also redeem Series A preferred shares from time to time for cash at a redemption price of $25.00 per share, plus all accrued and unpaid dividends thereon (whether or not authorized or declared) up to but excluding the date fixed for redemption (other than any dividend with a record date before the applicable redemption date and a payment date after the applicable redemption date, which will be paid on the payment date notwithstanding prior redemption of such shares), without interest, if our board of trustees has determined that such redemption is reasonably necessary to preserve our status as a REIT.
If fewer than all of the outstanding Series A preferred shares are to be redeemed, we will select the Series A preferred shares to be redeemed pro rata (as nearly as may be practicable without creating fractional shares) or by lot. If such redemption is to be by lot and, as a result of such redemption, any holder of Series A preferred shares, other than a holder of Series A preferred shares that has received an exemption from the ownership limit, would have actual, beneficial or constructive ownership of more than 9.8% of the issued and outstanding Series A preferred shares by value or number of shares, whichever is more restrictive, or violate any of the other restrictions on ownership and transfer of our shares set forth in our declaration of trust because such holder’s Series A preferred shares were not redeemed, or were only redeemed in part, then, except as otherwise provided in the declaration of trust, we will redeem the requisite number of Series A preferred shares of such holder such that no holder will own in excess of the 9.8% Series A preferred shares ownership limit or other restrictions on ownership and transfer of our shares subsequent to such redemption. See “Restrictions on Ownership and Transfer.” In order for their Series A preferred shares to be redeemed, holders must surrender their shares at the place, or in accordance with the book-entry procedures, designated in the notice of redemption. Holders will then be entitled to the redemption price and any accrued and unpaid dividends payable upon redemption following surrender of the shares. If a notice of redemption has been given (in the case of a redemption of the Series A preferred shares other than to preserve our status as a REIT), if the funds necessary for the redemption have been set aside by us for the benefit of the holders of any Series A preferred shares called for redemption and if irrevocable instructions have been given to pay the redemption price and all accrued and unpaid dividends, then, from and after the redemption date, dividends will cease to accrue on such Series A preferred shares and such Series A preferred shares will no longer be deemed outstanding. At such time, all rights of the holders of such shares will terminate, except the right to receive the redemption price plus any accrued and unpaid dividends payable upon redemption, without interest. So long as no dividends are in arrears for any past dividend periods and subject to the provisions of applicable law and the sufficiency of legally available funds, we may from time to time repurchase all or any part of the Series A preferred shares, including the repurchase of Series A preferred shares in open-market transactions and individual purchases at such prices as we negotiate, in each case as duly authorized by our board of trustees.
Unless full cumulative dividends on all Series A preferred shares have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past dividend periods, no Series A preferred shares will be redeemed (including pursuant to our special optional redemption right described below) unless all outstanding Series A preferred shares are simultaneously redeemed and we will not purchase or otherwise acquire directly or indirectly any Series A preferred shares or any class or series of our equity shares ranking, as to dividends and the distribution of assets upon our liquidation, dissolution or winding up, on parity with or junior to the Series A preferred shares; provided, however, that, whether or not the requirements set forth above have been met, we may purchase or otherwise acquire directly or indirectly Series A preferred shares, parity preferred shares or equity shares ranking junior to the Series A preferred shares pursuant to:

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•a conversion into or exchange for any class or series of equity shares ranking junior to the Series A preferred shares as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up;
•a redemption, purchase or other acquisition of common shares made for purposes of and in compliance with the requirements of an employee incentive or employee benefit plan of our company or any of its subsidiaries;
•the provisions of our declaration of trust intended to, among other purposes, preserve our status as a REIT as discussed under “Restrictions on Ownership and Transfer”; and
•a purchase or exchange offer made on the same terms to holders of all outstanding Series A preferred shares.
We will mail to record holders of the Series A preferred shares, postage prepaid, a notice of redemption no fewer than 30 days nor more than 60 days before the redemption date. We will send the notice to the address shown on our share transfer books. A failure to give notice of redemption or any defect in the notice or in its mailing will not affect the validity of the redemption of any Series A preferred shares except as to the holder to whom notice was defective or not given. In addition to any information required by law or by the applicable rules of any exchange upon which the Series A preferred shares may be listed or admitted to trading, each notice will state:
•the redemption date;
•the redemption price;
•the number of Series A preferred shares to be redeemed;
•the place or places where the certificates, if any, representing Series A preferred shares are to be surrendered for payment of the redemption price;
•procedures for surrendering noncertificated Series A preferred shares for payment of the redemption price;
•that dividends on the Series A preferred shares to be redeemed will cease to accrue on such redemption date; and
•that payment of the redemption price and any accumulated and unpaid dividends will be made upon presentation and surrender of such Series A preferred shares.
If fewer than all of the Series A preferred shares held by any holder are to be redeemed, the notice mailed to such holder will also specify the number of Series A preferred shares held by such holder to be redeemed.
We are not required to provide such notice in the event we redeem Series A preferred shares in order to maintain our status as a REIT.
If a redemption date falls after a dividend record date and on or prior to the corresponding dividend payment date, each holder of Series A preferred shares at the close of business of such dividend record date will be entitled to the dividend payable on such shares on the corresponding dividend payment date notwithstanding the redemption of such shares on or prior to such dividend payment date and each holder of Series A preferred shares that surrenders such shares on such redemption date will be entitled to the dividends accruing after the end of the applicable dividend period, up to but excluding the redemption date.
Except as described above, we will make no payment or allowance for unpaid dividends, whether or not in arrears, on Series A preferred shares for which a notice of redemption has been given.
All Series A preferred shares that we redeem or repurchase will be retired and restored to the status of authorized but unissued preferred shares, without designation as to series or class.
Special Optional Redemption
Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series A preferred shares, in whole or in part, within 120 days after the first date on which such Change of Control occurred, by paying $25.00 per share, plus any accrued and unpaid dividends to, but not including, the date of redemption (other than any dividend with a record date before the applicable redemption date and a payment date after the

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applicable redemption date, which will be paid on the payment date notwithstanding prior redemption of such shares). If, prior to the Change of Control Conversion Date, we have provided or provide notice of redemption with respect to any shares of Series A preferred shares (whether pursuant to our optional redemption right or our special optional redemption right), the holders of Series A preferred shares will not have the conversion rights described below under “—Conversion Rights” with respect to the shares of Series A preferred shares called for redemption.
We will mail to record holders of the Series A preferred shares, postage prepaid, a notice of redemption no fewer than 30 days nor more than 60 days before the redemption date. We will send the notice to the address shown on our share transfer books. A failure to give notice of redemption or any defect in the notice or in its mailing will not affect the validity of the redemption of any Series A preferred shares except as to the holder to whom notice was defective or not given. In addition to any information required by law or by the applicable rules of any exchange upon which the Series A preferred shares may be listed or admitted to trading, each notice will state:
•the redemption date;
•the redemption price;
•the number of Series A preferred shares to be redeemed;
•the place or places where the certificates, if any, representing the Series A preferred shares are to be surrendered for payment of the redemption price;
•procedures for surrendering noncertificated Series A preferred shares for payment of the redemption price;
•that dividends on the Series A preferred shares to be redeemed will cease to accrue on such redemption date;
•that payment of the redemption price and any accumulated and unpaid dividends will be made upon presentation and surrender of such Series A preferred shares;
•that the Series A preferred shares are being redeemed pursuant to our special optional redemption right in connection with the occurrence of a Change of Control and a brief description of the transaction or transactions constituting such Change of Control; and
•that the holders of the Series A preferred shares to which the notice relates will not be able to tender such Series A preferred shares for conversion in connection with the Change of Control and each series A preferred share tendered for conversion that is selected, prior to the Change of Control Conversion Date, for redemption will be redeemed on the related date of redemption instead of converted on the Change of Control Conversion Date.
•If we redeem fewer than all of the outstanding Series A preferred shares, the notice of redemption mailed to each shareholder will also specify the number of Series A preferred shares that we will redeem from each shareholder. In this case, we will determine the number of Series A preferred shares to be redeemed as described above in “—Optional Redemption.”
•If we have given a notice of redemption and have set aside sufficient funds for the redemption for the benefit of the holders of the Series A preferred shares called for redemption, then from and after the redemption date, those Series A preferred shares will no longer be outstanding, no further dividends will accrue and all other rights of the holders of those Series A preferred shares will terminate. The holders of those Series A preferred shares will retain their right to receive the redemption price for their shares and any accrued and unpaid dividends through, but not including, the redemption date, without interest.
•The holders of Series A preferred shares at the close of business on a dividend record date will be entitled to receive the dividend payable with respect to the Series A preferred shares on the corresponding payment date notwithstanding the redemption of the Series A preferred shares between such record date and the corresponding payment date or our default in the payment of the dividend due. Except as provided above, we will make no payment or allowance for unpaid dividends, whether or not in arrears, on Series A preferred shares to be redeemed.
A “Change of Control” is when, after the original issuance of the Series A preferred shares, each of the following have occurred and are continuing:

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•the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our company entitling that person to exercise more than 50% of the total voting power of all shares of our company entitled to vote generally in the election of our trustees (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and
•following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity (or if, in connection with such transaction, common shares are converted into or exchangeable for (in whole or in part) common equity securities of another entity, such other entity) has a class of common equity securities (or ADRs representing such securities) listed on the NYSE, the NYSE AMER or NASDAQ or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE AMER or NASDAQ.
Conversion Rights
Upon the occurrence of a Change of Control, each holder of Series A preferred shares will have the right, unless, on or prior to the Change of Control Conversion Date, we have provided or provide notice of our election to redeem the shares of Series A preferred shares as described under “ —Redemption” or “—Special Optional Redemption,” to convert some or all of the Series A preferred shares held by such holder (the “Change of Control Conversion Right”) on the Change of Control Conversion Date into a number of our common shares per series A preferred share (the “Common Share Conversion Consideration”), which is equal to the lesser of:
•the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control Conversion Date (unless the Change of Control Conversion Date is after a record date for a series A preferred share dividend payment and prior to the corresponding series A preferred share dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Share Price (such quotient, the “Conversion Rate”); and
•2.04666 (i.e., the Share Cap).
The Share Cap is subject to pro rata adjustments for any share splits (including those effected pursuant to a distribution of our common shares), subdivisions or combinations (in each case, a “Share Split”) with respect to our common shares as follows: the adjusted Share Cap as the result of a Share Split will be the number of our common shares that is equivalent to the product obtained by multiplying (i) the Share Cap in effect immediately prior to such Share Split by (ii) a fraction, the numerator of which is the number of our common shares outstanding after giving effect to such Share Split and the denominator of which is the number of our common shares outstanding immediately prior to such Share Split.
In the case of a Change of Control pursuant to which our common shares will be converted into cash, securities or other property or assets (including any combination thereof) (the “Alternative Form Consideration”), a holder of Series A preferred shares will receive upon conversion of such Series A preferred shares the kind and amount of Alternative Form Consideration which such holder would have owned or been entitled to receive upon the Change of Control had such holder held a number of our common shares equal to the Common Share Conversion Consideration immediately prior to the effective time of the Change of Control (the “Alternative Conversion Consideration,” and the Common Share Conversion Consideration or the Alternative Conversion Consideration, as may be applicable to a Change of Control, is referred to as the “Conversion Consideration”).
If the holders of our common shares have the opportunity to elect the form of consideration to be received in the Change of Control, the Conversion Consideration will be deemed to be the kind and amount of consideration actually received by holders of a majority of our common shares that were voted in such an election (if electing between two types of consideration) or holders of a plurality of our common shares that were voted in such an election (if electing between more than two types of consideration), as the case may be, and will be subject to any limitations to which all holders of our common shares are subject, including, without limitation, pro rata reductions applicable to any portion of the consideration payable in the Change of Control.

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We will not issue fractional common shares upon the conversion of the Series A preferred shares. Instead, we will pay the cash value of such fractional shares based on the Common Share Price.
Within 15 days following the occurrence of a Change of Control, we will provide to record holders of Series A preferred shares a notice of occurrence of the Change of Control that describes the resulting Change of Control Conversion Right. This notice will state the following:
•the events constituting the Change of Control;
•the date of the Change of Control;
•the last date on which the holders of Series A preferred shares may exercise their Change of Control Conversion Right;
•the method and period for calculating the Common Share Price;
•the Change of Control Conversion Date;
•that if, prior to the Change of Control Conversion Date, we have provided or provide notice of our election to redeem all or any portion of the Series A preferred shares, holders will not be able to convert the Series A preferred shares designated for redemption and such shares will be redeemed on the related redemption date, even if such shares have already been tendered for conversion pursuant to the Change of Control Conversion Right;
•if applicable, the type and amount of Alternative Conversion Consideration entitled to be received per series A preferred share;
•the name and address of the paying agent and the conversion agent; and
•the procedures that the holders of Series A preferred shares must follow to exercise the Change of Control Conversion Right.
A failure to give such notice or any defect in the notice or in its mailing will not affect the validity of the conversion of any Series A preferred shares except as to the holder to whom notice was defective.
We will issue a press release for publication on the Dow Jones & Company, Inc., Business Wire, PR Newswire or Bloomberg Business News (or, if these organizations are not in existence at the time of issuance of the press release, such other news or press organization as is reasonably calculated to broadly disseminate the relevant information to the public), or post a notice on our website, in any event prior to the opening of business on the first business day following any date on which we provide the notice described above to the holders of Series A preferred shares.
To exercise the Change of Control Conversion Right, the holders of Series A preferred shares will be required to deliver, on or before the close of business on the Change of Control Conversion Date, the certificates (if any) representing Series A preferred shares to be converted, duly endorsed for transfer, together with a completed written conversion notice, to our transfer agent. The conversion notice must state:
•the relevant Change of Control Conversion Date;
•the number of Series A preferred shares to be converted; and
•that the Series A preferred shares are to be converted pursuant to the applicable provisions of the Series A preferred shares.
The “Change of Control Conversion Date” is the date the Series A preferred shares are to be converted, which will be a business day that is no fewer than 20 days nor more than 35 days after the date on which we provide the notice described above to the holders of Series A preferred shares.
The “Common Share Price” will be (i) if the consideration to be received in the Change of Control by the holders of our common shares is solely cash, the amount of cash consideration per common share or (ii) if the consideration to be received in the Change of Control by holders of our common shares is other than solely cash (x) the average of the closing sale prices per share of our common shares (or, if no closing sale price is reported, the average of the closing bid and ask prices or, if more than one in either case, the average of the average closing bid and the average closing ask prices) for the ten consecutive trading days immediately preceding, but not including, the effective date

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of the Change of Control as reported on the principal U.S. securities exchange on which our common shares are then traded, or (y) the average of the last quoted bid prices for our common shares in the over-the-counter market as reported by OTC Markets Group, Inc. or similar organization for the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if our common shares are not then listed for trading on a U.S. securities exchange.
Holders of Series A preferred shares may withdraw any notice of exercise of a Change of Control Conversion Right (in whole or in part) by a written notice of withdrawal delivered to our transfer agent prior to the close of business on the business day prior to the Change of Control Conversion Date. The notice of withdrawal must state:
•the number of withdrawn Series A preferred shares;
•if certificated Series A preferred shares have been issued, the certificate numbers of the withdrawn Series A preferred shares; and
•the number of Series A preferred shares, if any, which remain subject to the conversion notice.
Notwithstanding the foregoing, if the Series A preferred shares are held in global form, the conversion notice and/or the notice of withdrawal, as applicable, must comply with applicable procedures of The Depository Trust Company, or DTC.
The Series A preferred shares as to which the Change of Control Conversion Right has been properly exercised and for which the conversion notice has not been properly withdrawn will be converted into the applicable Conversion Consideration in accordance with the Change of Control Conversion Right on the Change of Control Conversion Date, unless, on or prior to the Change of Control Conversion Date we have provided or provide notice of our election to redeem such Series A preferred shares, whether pursuant to our optional redemption right or our special optional redemption right. If we elect to redeem Series A preferred shares that would otherwise be converted into the applicable Conversion Consideration on a Change of Control Conversion Date, such Series A preferred shares will not be so converted and the holders of such shares will be entitled to receive on the applicable redemption date $25.00 per share, plus any accrued and unpaid dividends thereon to, but not including, the redemption date (other than any dividend with a record date before the applicable redemption date and a payment date after the applicable redemption date, which will be paid on the payment date notwithstanding prior redemption of such shares), in accordance with our optional redemption right or special optional redemption right. See “ —Optional Redemption” and “ —Special Optional Redemption” above.
We will deliver amounts owing upon conversion no later than the third business day following the Change of Control Conversion Date.
In connection with the exercise of any Change of Control Conversion Right, we will comply with all federal and state securities laws and stock exchange rules in connection with any conversion of Series A preferred shares into our common shares. Notwithstanding any other provision of the Series A preferred shares, no holder of Series A preferred shares will be entitled to convert such Series A preferred shares into our common shares to the extent that receipt of such common shares would cause such holder (or any other person) to exceed the restrictions on ownership and transfer of our shares contained in our declaration of trust unless we provide an exemption from this limitation for such holder. See “Restrictions on Ownership and Transfer.”
The Change of Control conversion feature may make it more difficult for a party to take over our company or discourage a party from taking over our company.
Except as provided above in connection with a Change of Control, the Series A preferred shares are not convertible into or exchangeable for any other securities or property.
No Maturity, Sinking Fund or Mandatory Redemption
The Series A preferred shares have no maturity date and we are not required to redeem the Series A preferred shares at any time. Accordingly, the Series A preferred shares will remain outstanding indefinitely, unless we decide, at our option, to exercise our redemption right or, under circumstances where the holders of the Series A preferred shares have a conversion right, such holders convert the Series A preferred shares into our common shares. The Series A preferred shares are not subject to any sinking fund.

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Limited Voting Rights
Holders of Series A preferred shares generally do not have any voting rights, except as set forth below.
If dividends on the Series A preferred shares are in arrears for six or more quarterly periods, whether or not consecutive (which we refer to as a preferred dividend default), holders of Series A preferred shares and holders of all other classes or series of parity preferred shares with which the holders of Series A preferred shares are entitled to vote together as a single class (voting together as a single class) will be entitled to vote for the election of two additional trustees to serve on our board of trustees (which we refer to as preferred share trustees), until all accumulated unpaid dividends with respect to the Series A preferred shares have been paid in full. At such time as holders of our Series A preferred shares become entitled to vote in the election of preferred share trustees, the number of trustees serving on our board of trustees will be increased automatically by two (unless the number of trustees has previously been so increased pursuant to the terms of any class or series of parity preferred shares). The preferred share trustees will be elected by a plurality of the votes cast in the election of preferred share trustees and each preferred share trustee will serve until our next annual meeting of shareholders and until his or her successor is duly elected and qualifies. The election of preferred share trustees will take place at:
•a special meeting of our shareholders called for the purpose of electing preferred share trustees upon the written request of holders of at least 10% of the outstanding Series A preferred shares and any other class or series of parity preferred shares entitled to vote together as a single class with the holders of Series A preferred shares in the election of preferred share trustees, if this request is received more than 90 days before the date fixed for our next annual or special meeting of shareholders or, if we receive the request for a special meeting within 90 days before the date fixed for our next annual or special meeting of shareholders, at our annual or special meeting of shareholders; and
•each subsequent annual meeting (or special meeting at which preferred share trustees are to be elected) until all dividends accumulated on the Series A preferred shares have been paid in full.
If and when all accumulated dividends on the Series A preferred shares shall have been paid in full, holders of Series A preferred shares shall be divested immediately of the voting rights set forth above (subject to revesting in the event of each and every preferred dividend default), and, unless outstanding parity preferred shares remain entitled to vote in the election of preferred share trustees, the term and office of such preferred share trustees so elected will terminate and the number of our trustees will be reduced accordingly.
Any preferred share trustee elected by holders of Series A preferred shares and any class or series of parity preferred shares, voting together as a single class, may be removed at any time with or without cause by the vote of, and may not be removed otherwise than by the vote of, the holders of record of a majority of the outstanding Series A preferred shares and any class or series of parity preferred shares then entitled to vote together as a single class in the election of preferred share trustees (voting together as a single class). So long as a preferred dividend default continues, any vacancy in the office of a preferred share trustee may be filled by written consent of the preferred share trustee remaining in office, or if none remains in office, by a plurality of the votes cast in the election of preferred share trustees. The preferred share trustees shall each be entitled to one vote on any matter before the board of trustees.
In addition, so long as any Series A preferred shares remain outstanding, we will not, without the consent or the affirmative vote of the holders of at least two-thirds of the outstanding Series A preferred shares and each other class or series of parity preferred shares with which the holders of Series A preferred shares are entitled to vote together as a single class on such matter (voting together as a single class):
•authorize, create or issue, or increase the number of authorized or issued number of shares of, any class or series of shares ranking senior to the Series A preferred shares with respect to payment of dividends, or the distribution of assets upon our liquidation, dissolution or winding up, or reclassify any of our authorized equity shares into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or
•amend, alter or repeal the provisions of our declaration of trust, including the terms of the Series A preferred shares, whether by merger, consolidation, transfer or conveyance of all of or substantially all of

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our assets or otherwise, so as to materially and adversely affect any right, preference, privilege or voting power of the Series A preferred shares,
except that, with respect to the occurrence of any of the events described in the second bullet point immediately above, so long as the Series A preferred shares remain outstanding with the terms of the Series A preferred shares materially unchanged, taking into account that, upon the occurrence of an event described in the second bullet point above, we may not be the surviving entity and the surviving entity may not be a real estate investment trust within the meaning of the MRL, the occurrence of such event will not be deemed to materially and adversely affect the rights, preferences, privileges or voting powers of the Series A preferred shares, and in such case such holders shall not have any voting rights with respect to the events described in the second bullet point immediately above. Furthermore, if holders of the Series A preferred shares receive the greater of the full trading price of the Series A preferred shares on the date of an event described in the second bullet point immediately above or, pursuant to any such event, the $25.00 per share liquidation preference plus all accrued and unpaid dividends thereon to, but not including the date of an event described in the second bullet point immediately above, then such holders shall not have any voting rights with respect to the events described in the second bullet point immediately above. If any event described in the second bullet point above would materially and adversely affect the rights, preferences, privileges or voting powers of the Series A preferred shares disproportionately relative to any other class or series of parity preferred shares, the affirmative vote of the holders of at least two-thirds of the outstanding Series A preferred shares, voting as a separate class, will also be required.
Notwithstanding the foregoing, holders of Series A preferred shares will not be entitled to vote with respect to (i) any increase in the total number of our authorized common shares or preferred shares, (ii) any increase in the number of authorized Series A preferred shares or the creation or issuance of any other class or series of equity shares or (iii) any increase in the number of authorized shares of any other class or series of equity shares, provided that, in each case referred to in clause (i), (ii) or (iii) above, such shares rank on parity with or junior to the Series A preferred shares with respect to the payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up.
Except as set forth herein, holders of Series A preferred shares will not have any voting rights with respect to, and the consent of the holders of Series A preferred shares is not required for, the taking of any corporate action, including any merger, consolidation, transfer or conveyance of all or substantially all of our assets or otherwise, regardless of the effect that such corporate action or merger, consolidation, transfer or conveyance of all or substantially all of our assets or otherwise may have upon the powers, preferences, voting power or other rights or privileges of the Series A preferred shares.
In addition, the voting provisions above will not apply if, at or prior to the time when the act with respect to which the vote would otherwise be required shall be effected, we have redeemed or called for redemption upon proper procedures all outstanding Series A preferred shares.
In any matter in which Series A preferred shares may vote (as expressly provided in the articles supplementary setting forth the terms of the Series A preferred shares), each series A preferred share shall be entitled to one vote per $25.00 of liquidation preference. As a result, each series A preferred share will be entitled to one vote.
Information Rights
During any period in which we are not subject to Section 13 or 15(d) of the Exchange Act and any Series A preferred shares are outstanding, we will use our commercially reasonable best efforts to transmit through our website at http://www.nationalstorageaffiliates.com/ (or other permissible means under the Exchange Act) copies of the Annual Reports on Form 10 K and Quarterly Reports on Form 10 Q that we would have been required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act if we were subject thereto (other than any exhibits that would have been required). We will use our commercially reasonable best efforts to provide such reports on our website within 15 days after the respective dates by which we would have been required to file such reports with the SEC if we were subject to Section 13 or 15(d) of the Exchange Act and we were a “non accelerated filer” within the meaning of the Exchange Act.
Transfer Agent
The transfer agent and registrar for the Series A preferred shares is Broadridge Financial Solutions, Inc.

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Listing
The Series A preferred shares are listed on the NYSE under the symbol “NSA Pr A”.
Power to Reclassify Our Unissued Shares of Beneficial Interest
Our declaration of trust authorizes our board of trustees to classify and reclassify any unissued common or preferred shares of beneficial interest into other classes or series of shares of beneficial interest. Prior to the issuance of shares of each class or series, our board of trustees is required by Maryland law and by our declaration of trust to set, subject to the provisions of our declaration of trust regarding the restrictions on ownership and transfer of shares of beneficial interest and the terms of any other class or series of our shares then outstanding, including the Series A preferred shares, the number of shares and the terms, preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of each class or series. Therefore, our board could authorize the issuance of a series of common shares or preferred shares that have priority over our common shares as to voting rights, dividends or upon liquidation or with terms and conditions that could have the effect of delaying, deferring or preventing a change in control or other transaction that might involve a premium price for our common shares or otherwise be in the best interests of our shareholders.
Power to Increase or Decrease Authorized Shares of Beneficial Interest and Issue Additional Shares of Common Shares and Preferred Shares of Beneficial Interest
We believe that the power of our board of trustees to amend our declaration of trust without common shareholder approval to increase or decrease the number of authorized shares of beneficial interest, to authorize us to issue additional authorized but unissued common shares or preferred shares of beneficial interest and to classify or reclassify unissued common shares or preferred shares of beneficial interest and thereafter to issue such classified or reclassified shares of beneficial interest will provide us with increased flexibility in structuring possible future financings and acquisitions and in meeting other needs that might arise. The additional classes or series, as well as the additional common shares, will be available for issuance without further action by our common shareholders, unless such action is required by applicable law or the rules of any stock exchange or automated quotation system on which our securities may be listed or traded. Although our board of trustees does not intend to do so, it could authorize us to issue a class or series of shares that could, depending upon the terms of the particular class or series, delay, defer or prevent a change in control or other transaction that might involve a premium price for our common shares or otherwise be in the best interests of our shareholders.
Restrictions on Ownership and Transfer
In order for us to qualify as a REIT under the Internal Revenue Code (the “Code”), our shares must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months (other than the first year for which an election to be a REIT has been made) or during a proportionate part of a shorter taxable year. Also, not more than 50% of the value of our outstanding shares may be owned, directly or indirectly, by five or fewer individuals (as defined in the Code to include certain entities such as qualified pension plans) during the last half of a taxable year (other than the first year for which an election to be a REIT has been made). To qualify as a REIT, we must satisfy other requirements as well.
Our declaration of trust contains restrictions on the ownership and transfer of our shares, including common shares and preferred shares. The relevant sections of our declaration of trust provide that, subject to the exceptions described below, no person, including a “group,” as defined in Section 13(d)(3) of the Exchange Act, may own, or be deemed to own, beneficially or by virtue of the applicable constructive ownership provisions of the Code, more than 9.8% by value or number of shares, whichever is more restrictive, of our aggregate outstanding shares of all classes and series, the outstanding shares of any class or series of our preferred shares or our outstanding common shares. We refer to these limits collectively as the “ownership limit.” An individual or entity that becomes subject to the ownership limit or any of the other restrictions on ownership and transfer of our shares described below is referred to as a “prohibited owner” if, had the violative transfer or other event been effective, the individual or entity would have been a beneficial or constructive owner or, if appropriate, a record owner of our shares in violation of the ownership limit or other restriction. In addition, the articles supplementary for each class or series of preferred shares may contain additional provisions restricting the ownership and transfer of the preferred shares. The applicable prospectus supplement will specify any additional ownership limitation relating to a class or series of preferred shares.

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The constructive ownership rules under the Code are complex and may cause shares owned actually or constructively by a group of related individuals and/or entities to be owned constructively by one individual or entity. As a result, the acquisition of less than 9.8% by value or number of shares, whichever is more restrictive, of our outstanding common shares or any class or series of our preferred shares, or 9.8% by value or number of shares, whichever is more restrictive, of our aggregate outstanding shares of all classes and series (or the acquisition of an interest in an entity that owns, actually or constructively, our shares by an individual or entity), could, nevertheless, cause that individual or entity, or another individual or entity, to own constructively in excess of the ownership limit.
Our board of trustees may, in its sole discretion, subject to the receipt of such information, representations or undertakings as it may determine, prospectively or retroactively, exempt a person from all or any component of the ownership limit and establish a different limit on ownership, or excepted holder limit, for a particular person if the person’s ownership in excess of the ownership limit would not result in our being “closely held” within the meaning of Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year) or otherwise would result in our failing to qualify as a REIT. As a condition of its exemption or grant of excepted holder limit, our board of trustees may, but is not required to, require an opinion of counsel or IRS ruling satisfactory to our board of trustees in order to determine or ensure our qualification as a REIT.
In connection with the creation of an excepted holder limit or at any other time, our board of trustees may from time to time increase or decrease the ownership limit or any component thereof unless, after giving effect to such increase, we would be “closely held” under Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year) or we would otherwise fail to qualify as a REIT. Prior to the modification of the ownership limit, our board of trustees may require such opinions of counsel, affidavits, undertakings or agreements as it may deem necessary or advisable in order to determine or ensure our qualification as a REIT. A reduced ownership limit will not apply to any person or entity whose percentage ownership of our common shares, preferred shares of any class or series, or shares of all classes and series, as applicable, is in excess of such decreased ownership limit until such time as such individual’s or entity’s percentage ownership of our common shares, preferred shares of any class or series, or shares of all classes and series, as applicable, equals or falls below the decreased ownership limit, but any further acquisition of our common shares or shares of any other class or series, as applicable, in excess of such percentage ownership of our common shares, preferred shares or shares of all classes and series will be in violation of the ownership limit.
Our declaration of trust further prohibits:
•any person from beneficially or constructively owning, applying certain attribution rules of the Code, our shares such that it would result in our being “closely held” under Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year) or would otherwise cause us to fail to qualify as a REIT; and
•any person from transferring our shares if such transfer would result in our shares being beneficially owned by fewer than 100 persons (determined without reference to any rules of attribution).
Any person who acquires or attempts or intends to acquire beneficial or constructive ownership of our shares that will or may violate the ownership limit or any of the other foregoing restrictions on ownership and transfer of our shares, or who would have owned shares transferred to a charitable trust as described below, must immediately give us written notice of the event or, in the case of an attempted or proposed transaction, must give at least 15 days’ prior written notice to us, and provide us with such other information as we may request in order to determine the effect of such transfer on our qualification as a REIT. The foregoing restrictions on ownership and transfer of our shares has applied since the completion of our initial public offering and will not apply if our board of trustees determines that it is no longer in our best interests to attempt to qualify, or to continue to qualify, as a REIT or that compliance with the applicable restriction or limitation on ownership and transfer of our shares as described above is no longer required in order for us to qualify as a REIT.
If any transfer of our shares would result in our shares being beneficially owned by fewer than 100 persons, such transfer will be void and the intended transferee will acquire no rights in such shares. In addition, if any purported transfer of our shares or any other event would otherwise result in any person violating the ownership limit or an excepted holder limit established by our board of trustees or in our being “closely held” under Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year) or otherwise

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failing to qualify as a REIT, then that number of shares (rounded up to the nearest whole share) that would cause us to violate such restrictions will be automatically transferred to, and held by, a charitable trust for the exclusive benefit of one or more charitable organizations selected by us and the intended transferee will acquire no rights in such shares. The automatic transfer will be effective as of the close of business on the business day prior to the date of the proposed transfer or other event that results in a transfer to the charitable trust. Any dividend or other distribution paid to the prohibited owner prior to our discovery that the shares had been automatically transferred to a charitable trust as described above must be repaid to the charitable trustee upon demand for distribution to the beneficiary by the charitable trust. If the transfer to the charitable trust as described above is not automatically effective, for any reason, to prevent violation of the applicable ownership limit or our being “closely held” under Section 856(h) of the Code (without regard to whether the ownership interest is held during the last half of a taxable year) or otherwise failing to qualify as a REIT, then our declaration of trust provides that the transfer of the shares will be null and void and the prohibited owner will acquire no rights in the shares.
Shares transferred to the charitable trustee are deemed offered for sale to us, or our designee, at a price per share equal to the lesser of (i) the price per share in the transaction that caused the transfer to the charitable trust (or, if the event that resulted in the transfer to the charitable trust did not involve a purchase of such shares at the market price, the market price (as defined in our declaration of trust) on the day of the event causing the shares to be transferred to the charitable trust) and (ii) the market price on the date we, or our designee, accept the offer. We may reduce the amount payable to the charitable trust, however, by the amount of any dividends or distributions paid to the prohibited owner and owed by the prohibited owner to the charitable trustee and pay the amount of such reduction to the charitable trustee for the benefit of the charitable beneficiary. We have the right to accept such offer until the charitable trustee has sold our shares held in the charitable trust as discussed below. Upon a sale to us, the interest of the charitable beneficiary in our shares sold terminates, and the charitable trustee must distribute the net proceeds of the sale to the prohibited owner and pay any dividends or other distributions or other amounts held by the charitable trustee with respect to such shares to the charitable beneficiary.
If we do not buy the shares, the charitable trustee must, within 20 days of receiving notice from us of the transfer of shares to the charitable trust, sell the shares to a person or entity designated by the charitable trustee who could own the shares without violating the ownership limit or the other restrictions on ownership and transfer of our shares. After the sale of the shares, the interest of the charitable beneficiary in the shares transferred to the charitable trust will terminate and the charitable trustee must distribute to the prohibited owner an amount equal to the lesser of (i) the price paid by the prohibited owner for the shares or, if the event that resulted in the transfer to the charitable trust did not involve a purchase of such shares at the market price, the market price of the shares on the day of the event causing the shares to be transferred to the charitable trust and (ii) the net sale price received by the charitable trustee from the sale or other disposition of the shares. The charitable trustee may reduce the amount payable to the prohibited owner by the amount of any dividend or other distribution that we paid to the prohibited owner before we discovered that the shares had been automatically transferred to the charitable trust and that are then owed to the charitable trustee as described above. Any net sales proceeds in excess of the amount payable to the prohibited owner will be immediately paid to the beneficiary of the charitable trust, together with any other amounts held by the charitable trustee for the beneficiary of the charitable trust. In addition, if, prior to discovery by us that shares have been transferred to a charitable trust, such shares are sold by a prohibited owner, then such shares will be deemed to have been sold on behalf of the charitable trust and to the extent that the prohibited owner received an amount for or in respect of such shares that exceeds the amount that such prohibited owner was entitled to receive, such excess amount must be paid to the charitable trustee upon demand. The prohibited owner has no rights in the shares held by the charitable trustee.
The charitable trustee will be designated by us and will be unaffiliated with us and with any prohibited owner. Prior to the sale of any shares by the charitable trust, the charitable trustee will receive, in trust for the beneficiary of the charitable trust, all dividends and other distributions paid by us with respect to the shares held in trust and may also exercise all voting rights with respect to the shares held in trust. These rights will be exercised for the exclusive benefit of the beneficiary of the charitable trust.
Subject to Maryland law, effective as of the date that the shares have been transferred to the charitable trust, the charitable trustee will have the authority, at the charitable trustee’s sole discretion:

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•to rescind as void any vote cast by a prohibited owner prior to our discovery that the shares have been transferred to the charitable trust; and
•to recast the vote in accordance with the desires of the charitable trustee, acting for the benefit of the beneficiary of the charitable trust.
However, if we have already taken irreversible trust action, then the charitable trustee may not rescind and recast the vote.
In addition, if our board of trustees determines that a proposed transfer or other event would violate the restrictions on ownership and transfer of our shares set forth in our declaration of trust, our board of trustees may take such action as it deems advisable to refuse to give effect to or to prevent such transfer or other event, including, but not limited to, causing us to redeem the shares, refusing to give effect to the transfer on our books or instituting proceedings to enjoin the transfer or other event.
Every owner of more than 5% (or such lower percentage as required by the Code or the regulations promulgated thereunder) of our outstanding shares, within 30 days after the end of each taxable year, must give us written notice, stating the shareholder’s name and address, the number of shares of each class and series of our shares that the shareholder beneficially owns and a description of the manner in which the shares are held. Each such owner must provide to us in writing such additional information as we may request in order to determine the effect, if any, of the shareholder’s beneficial ownership on our qualification as a REIT and to ensure compliance with the ownership limit. In addition, each shareholder must provide to us in writing such information as we may request in good faith in order to determine our qualification as a REIT and to comply with the requirements of any taxing authority or governmental authority or to determine such compliance.
Any certificates representing our shares will bear a legend referring to the restrictions described above.
These restrictions on ownership and transfer could delay, defer or prevent a transaction or a change in control that might involve a premium price for the common shares or otherwise be in the best interest of the shareholders.
Certain Provisions of the Maryland General Corporation Law and our Declaration of Trust and Bylaws
Our Board of Trustees
Our declaration of trust provides that the number of trustees we have may be established only by our board of trustees and our bylaws provide that the number of our trustees may not be fewer than the minimum number required under the MRL, which is one, or more than 15. Because our board of trustees has the power to amend our bylaws, it could modify the bylaws to change that range. Subject to the terms of any class or series of preferred shares, vacancies on our board of trustees may be filled only by a majority of the remaining trustees, even if the remaining trustees do not constitute a quorum, and, if our board of trustees is classified, any trustee elected to fill a vacancy will hold office for the remainder of the full term of the trusteeship in which the vacancy occurred and until his or her successor is duly elected and qualifies.
Except as may be provided with respect to any class or series of our shares, at each annual meeting of our shareholders, each of our trustees will be elected by our common shareholders to serve until the next annual meeting of our shareholders and until his or her successor is duly elected and qualifies.
Removal of Trustees
Our declaration of trust provides that, subject to the rights of holders of any class or series of preferred shares, a trustee may be removed with or without cause, by the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of trustees.
Business Combinations
Under certain provisions of the Maryland General Corporation Law (the “MGCL”) applicable to a Maryland real estate investment trust, certain “business combinations,” including a merger, consolidation, statutory share exchange or, in certain circumstances, an asset transfer or issuance or reclassification of equity securities, between a Maryland real estate investment trust and an “interested shareholder” or, generally, any person who beneficially owns, directly or indirectly, 10% or more of the voting power of the real estate investment trust’s outstanding voting shares or an affiliate or associate of the real estate investment trust who, at any time within the two-year period prior to the date

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in question, was the beneficial owner of 10% or more of the voting power of the then outstanding voting shares of the real estate investment trust, or an affiliate of such an interested shareholder, are prohibited for five years after the most recent date on which the interested shareholder becomes an interested shareholder. Thereafter, any such business combination must be recommended by the board of trustees of the real estate investment trust and approved by the affirmative vote of at least (a) 80% of the votes entitled to be cast by holders of outstanding voting shares of the real estate investment trust and (b) two-thirds of the votes entitled to be cast by holders of voting shares of the real estate investment trust other than shares held by the interested shareholder with whom (or with whose affiliate) the business combination is to be effected or held by an affiliate or associate of the interested shareholder, unless, among other conditions, the real estate investment trust’s common shareholders receive a minimum price (as defined in the MGCL) for their shares and the consideration is received in cash or in the same form as previously paid by the interested shareholder for its shares. Under the MGCL, a person is not an “interested shareholder” if the board of trustees approved in advance the transaction by which the person otherwise would have become an interested shareholder. A real estate investment trust’s board of trustees may provide that its approval is subject to compliance with any terms and conditions determined by it.
These provisions of the MGCL do not apply, however, to business combinations that are approved or exempted by the real estate investment trust’s board of trustees prior to the time that the interested shareholder becomes an interested shareholder. Pursuant to the statute, our board of trustees has by resolution exempted business combinations between us and (1) any other person, provided that the business combination is first approved by our board of trustees (including a majority of trustees who are not affiliates or associates of such person), (2) Arlen D. Nordhagen and any of his affiliates and associates and (3) any person acting in concert with the foregoing, from these provisions of the MGCL. As a result, such persons may be able to enter into business combinations with us that may not be in the best interests of our shareholders without compliance by us with the supermajority vote requirements and other provisions of the statute. This resolution, however, may be altered or repealed in whole or in part at any time. If this resolution is repealed, or our board of trustees does not otherwise approve a business combination, this statute may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer.
Control Share Acquisitions
Certain provisions of the MGCL applicable to a Maryland real estate investment trust provide that a holder of “control shares” of a Maryland real estate investment trust acquired in a “control share acquisition” has no voting rights with respect to such shares except to the extent approved by the affirmative vote of two-thirds of the votes entitled to be cast on the matter, excluding any of the following persons entitled to exercise or direct the exercise of the voting power of such shares in the election of trustees: (1) a person who makes or proposes to make a control share acquisition, (2) an officer of the real estate investment trust or (3) an employee of the real estate investment trust who is also a trustee of the real estate investment trust. “Control shares” are voting shares which, if aggregated with all other such shares owned by the acquirer, or in respect of which the acquirer is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquirer to exercise voting power in electing trustees within one of the following ranges of voting power: (A) one-tenth or more but less than one-third, (B) one-third or more but less than a majority or (C) a majority or more of all voting power. Control shares do not include shares acquired directly from the real estate investment trust or shares that the acquirer is then entitled to vote as a result of having previously obtained shareholder approval. A “control share acquisition” means the acquisition, directly or indirectly, of ownership of, or the power to direct the exercise of voting power with respect to, issued and outstanding control shares, subject to certain exceptions.
A person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions (including an undertaking to pay expenses and making an acquiring person statement (as described in the MGCL)), may compel the board of trustees to call a special meeting of shareholders to be held within 50 days of demand to consider the voting rights of the shares. If no request for a meeting is made, the real estate investment trust may itself present the question at any shareholders’ meeting.
If voting rights are not approved at the meeting or if the acquirer does not deliver an acquiring person statement as required by the statute, then, subject to certain conditions and limitations, the real estate investment trust may redeem any or all of the control shares (except those for which voting rights have previously been approved) for fair value determined, without regard to the absence of voting rights for the control shares, as of the date of the last

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control share acquisition by the acquirer or, if a meeting of shareholders is held at which the voting rights of the shares are considered and not approved, as of the date of the meeting. If voting rights for control shares are approved at a shareholders’ meeting and the acquirer becomes entitled to vote a majority of the shares entitled to vote, all other shareholders may exercise appraisal rights, unless the declaration of trust or bylaws provide otherwise. The fair value of the shares as determined for purposes of such appraisal rights may not be less than the highest price per share paid by the acquirer in the control share acquisition.
The control share acquisition statute does not apply to (a) shares acquired in a merger, consolidation or share exchange if the real estate investment trust is a party to the transaction or (b) acquisitions approved or exempted by the declaration of trust or bylaws of the real estate investment trust.
Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of our shares. There is no assurance that such provision will not be amended or eliminated at any time in the future by our board of trustees.
Subtitle 8
Subtitle 8 of Title 3 of the MGCL permits a Maryland real estate investment trust with a class of equity securities registered under the Exchange Act and at least three independent trustees to elect to be subject, by provision in its declaration of trust or bylaws or a resolution of its board of trustees and notwithstanding any contrary provision in the declaration of trust or bylaws, to any or all of five provisions which provide for:
•a classified board;
•a two-thirds vote requirement for removing a trustee;
•a requirement that the number of trustees be fixed only by vote of the trustees;
•a requirement that a vacancy on the board be filled only by the remaining trustees in office and (if the board is classified) for the remainder of the full term of the class of trustees in which the vacancy occurred; and
•a majority requirement for the calling of a special meeting of shareholders.
We have not elected to be subject to any of the provisions of Subtitle 8. Moreover, our declaration of trust provides that, without the affirmative vote of a majority of the votes cast on the matter by our shareholders entitled to vote generally in the election of trustees, we may not elect to be subject to any of the provisions of Subtitle 8. Through provisions in our declaration of trust and bylaws unrelated to Subtitle 8, we already (1) require the affirmative vote of the holders of at least two-thirds of all of the votes entitled to be cast generally in the election of trustees for the removal of any trustee from the board, with or without cause, (2) vest in the board the exclusive power to fix the number of trustees, (3) require that a vacancy on the board be filled only by a majority of the remaining trustees even if less than a quorum, and (4) require, unless called by our chairman of the board, our chief executive officer, our president or our board of trustees, the written request of shareholders entitled to cast a majority of the votes entitled to be cast at such meeting to call a special meeting of shareholders.
Shareholder Rights Plan
We do not have a shareholder rights plan and our board of trustees has adopted a policy that our board may not adopt any shareholder rights plan unless the adoption of the plan has been approved by the affirmative vote of a majority of the votes cast on the matter by shareholders entitled to vote generally in the election of trustees, except that our board of trustees may adopt a shareholder rights plan without the prior approval of our shareholders if our board, in the exercise of its duties, determines that seeking prior shareholder approval would not be in our best interests under the circumstances then existing. The policy further provides that if a shareholder rights plan is adopted by our board without the prior approval of our shareholders, the shareholder rights plan will expire on the date of the first annual meeting of shareholders held after the first anniversary of the adoption of the plan, unless an extension of the plan is approved by our common shareholders.
Meetings of Shareholders
Pursuant to our bylaws, a meeting of our shareholders for the purpose of the election of trustees and the transaction of any business will be held annually on a date and at the time and place set by or under the direction of our board of trustees. In addition, our chairman, chief executive officer, president or board of trustees may call a special meeting

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of our shareholders. Subject to the provisions of our declaration of trust and bylaws, a special meeting of our shareholders will also be called by our secretary upon the written request of the shareholders entitled to cast a majority of all the votes entitled to be cast at the meeting accompanied by the information required by our bylaws. Our secretary will inform the requesting shareholders of the reasonably estimated cost of preparing and delivering the notice of meeting (including our proxy materials), and the requesting shareholders must pay such estimated cost before our secretary is required to prepare and deliver the notice of the special meeting. Only the matters set forth in the notice of any special meeting may be considered and acted upon at such meeting.
Exclusive Forum for Certain Litigation
Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland, or if that court does not have jurisdiction, the U.S. District Court for the District of Maryland, Baltimore Division, will be the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action asserting a claim of breach of any duty owed by any trustee or officer or other employee to us or to our shareholders, (c) any action asserting a claim against us or any trustee or officer or other employee arising pursuant to any provision of the MRL or our declaration of trust or bylaws, or (d) any action asserting a claim against us or any trustee or officer or other employee that is governed by the internal affairs doctrine. This provision does not apply to claims brought under federal securities laws, such as “other than actions arising under federal securities laws”.
Amendment to our Bylaws
Our bylaws permit equityholders to alter or repeal any provision of the bylaws and to adopt new bylaws if approved by a Majority Common Share (and Equivalent) Holder Approval (as defined in our bylaws). The approval of amendments to our bylaws requires the affirmative vote of both (a) holders of a majority of our common shares outstanding as of the Determination Date (as defined in our bylaws) and (b) holders of common shares and limited partners (other than us) of our operating partnership (as defined below) representing a majority of the number of common shares outstanding as of the Determination Date together with the number of additional common shares that would be issuable if (1) all Class A common units of limited partner interest in our operating partnership (“Class A OP Units”) (including the number of Class A OP Units issuable upon the exchange of all DownREIT Class X Units (as defined in the Third Amended and Restated Limited Partnership Agreement (the “Partnership Agreement”) of NSA OP, LP, a Delaware limited partnership (our “operating partnership”)) outstanding as of the Determination Date were exchanged on a one-for-one basis, subject to adjustments as provided in the Partnership Agreement, for common shares and (2) the Class A OP Units which would be outstanding if each series of Class B common units of limited partner interest in our operating partnership (“Class B OP Units”) (including the number of Class B OP Units issuable upon the exchange of DownREIT Class B Units (as defined in the Partnership Agreement)) (or other similar class or series of OP units created from time to time) outstanding as of the Determination Date (whether or not then convertible) were converted into Class A OP Units using the conversion ratio for each such class or series in effect as of the last day of the most recent fiscal year determined pursuant to the terms of the Partnership Agreement and as approved by our board of trustees, were exchanged on a one-for-one basis, subject to adjustments as provided in the Partnership Agreement, for common shares. Notwithstanding the foregoing, our shareholders do not have the power to alter or repeal, or to adopt any provision inconsistent with, any provision of our bylaws relating to the amendment of our bylaws.
Our board of trustees has the power to alter, amend or repeal any provision of our bylaws and to adopt new bylaws.
Termination of our Company
Our declaration of trust provides for us to have a perpetual existence. Our termination must be approved by a majority of our entire board of trustees and the affirmative vote of not less than a majority of all of the votes entitled to be cast on the matter.
Advance Notice of Trustee Nominations and New Business
Our bylaws provide that, with respect to an annual meeting of shareholders, nominations of individuals for election to our board of trustees and the proposal of business to be considered by shareholders may be made only (1) pursuant to our notice of the meeting, (2) by or at the direction of our board of trustees or (3) by a shareholder of record both at the time of the giving of the notice required by our bylaws and at the time of the meeting, who is

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entitled to vote at the meeting in the election of each such nominee or on such other business and who has complied with the advance notice provisions set forth in our bylaws. Our bylaws currently require the shareholder generally to provide notice to the secretary containing the information and other materials required by our bylaws not less than 120 days nor more than 150 days prior to the first anniversary of the date our proxy statement for the solicitation of proxies for election of trustees at the preceding year’s annual meeting is first released to our shareholders (or in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, not less than 120 days nor more than 150 days prior to the date of such annual meeting, as originally convened, or the tenth day following the day on which public announcement of the date of such meeting is first made).
With respect to special meetings of shareholders, only the business specified in our notice of meeting may be brought before the meeting. Nominations of individuals for election to our board of trustees at a special meeting may be made only (1) by or at the direction of our board of trustees or (2) provided that the special meeting has been called in accordance with our bylaws for the purpose of electing trustees, by a shareholder of record both at the time of the giving of the notice required by our bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each such nominee and who has complied with the advance notice provisions set forth in our bylaws. Such a shareholder may nominate one or more individuals, as the case may be, for election as a trustee if the shareholder’s notice containing the information and other materials required by our bylaws is delivered to the secretary not earlier than the 120th day prior to such special meeting and not later than 5:00 p.m., Mountain Time, on the later of (1) the 90th day prior to such special meeting or (2) the tenth day following the day on which public announcement is first made of the date of the special meeting and the nominees of our board of trustees to be elected at the meeting. The shareholder’s notice must include the same information required to be included in a notice delivered in connection with an annual meeting as described in the preceding paragraph.
Anti-takeover Effect of Certain Provisions of Maryland Law and of Our Declaration of Trust and Bylaws
If the applicable exemption in our bylaws is repealed and/or the applicable resolution of our board of trustees is repealed, the control share acquisition provisions and/or the business combination provisions of the MGCL, respectively, as well as the provisions in our declaration of trust and bylaws on removal of trustees and filling trustee vacancies, the provisions in our declaration of trust regarding the restrictions on ownership and transfer of our shares, together with the advance notice and shareholder-requested special meeting provisions of our bylaws, alone or in combination, could serve to delay, deter or prevent a transaction or a change in our control that might involve a premium price for holders of our common shares or otherwise be in their best interests.
Indemnification and Limitation of Trustees’ and Officers’ Liability
Maryland law permits a Maryland real estate investment trust to include in its declaration of trust a provision eliminating the liability of its trustees and officers to the real estate investment trust and its shareholders for money damages except for liability resulting from actual receipt of an improper benefit or profit in money, property or services or active and deliberate dishonesty that was established by a final judgment and was material to the cause of action. Our declaration of trust contains a provision that eliminates the liability of our trustees and officers to the maximum extent permitted by Maryland law.
Maryland law permits a Maryland real estate investment trust to indemnify and advance expenses to its trustees and officers to the same extent as permitted for directors and officers of Maryland corporations. The MGCL requires a Maryland corporation (unless its charter provides otherwise, which our declaration of trust does not) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made a party by reason of his or her service in that capacity. The MGCL permits a Maryland corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or threatened to be made a party by reason of their service in those or other capacities unless it is established that:
•the act or omission of the director or officer was material to the matter giving rise to the proceeding and (i) was committed in bad faith or (ii) was the result of active and deliberate dishonesty;
•the director or officer actually received an improper personal benefit in money, property or services; or

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•in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful.
Under the MGCL, a Maryland corporation may not indemnify a director or officer in a suit by or on behalf of the corporation in which the director or officer was adjudged liable to the corporation or in a suit in which the director or officer was adjudged liable on the basis that personal benefit was improperly received. Nevertheless, a court may order indemnification if it determines that the director or officer is fairly and reasonably entitled to indemnification, even though the director or officer did not meet the prescribed standard of conduct or was adjudged liable on the basis that personal benefit was improperly received. However, indemnification for an adverse judgment in a suit by or on behalf of the corporation, or for a judgment of liability on the basis that personal benefit was improperly received, is limited to expenses.
In addition, the MGCL permits a Maryland corporation to advance reasonable expenses to a director or officer upon its receipt of:
•a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation; and
•a written undertaking by the director or officer or on the director’s or officer’s behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the director or officer did not meet the standard of conduct.
Our declaration of trust authorizes us to obligate ourselves and our bylaws obligate us, to the fullest extent permitted by Maryland law in effect from time to time, to indemnify and, without requiring a preliminary determination of such individual’s ultimate entitlement to indemnification, to pay or reimburse reasonable expenses in advance of final disposition of a proceeding to any individual who is made or threatened to be made a party to, or witness in, a proceeding by reason of his or her service:
•as a present or former trustee or officer; or
•while a trustee or officer of our company and at our request, as a trustee, director, officer, partner, manager, or member of another corporation, real estate investment trust, partnership, joint venture, limited liability company, trust, employee benefit plan or any other enterprise
from and against any claim or liability to which he or she may become subject or that he or she may incur by reason of his or her service in any of these capacities. Our declaration of trust and bylaws also permit us to indemnify and advance expenses to any employee or agent of our company or a predecessor of our company.
We have entered into indemnification agreements with each of our trustees and executive officers that provide for indemnification to the maximum extent permitted by Maryland law.
Insofar as the foregoing provisions permit indemnification of trustees, officers or persons controlling us for liability arising under the Securities Act, we have been informed that, in the opinion of the SEC, this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
REIT Qualification
Our declaration of trust provides that our board of trustees may revoke or otherwise terminate our REIT election, without approval of our shareholders, if it determines that it is no longer in our best interest to attempt to, or continue to, qualify as a REIT. Our declaration of trust also provides that our board of trustees may determine that compliance with any restriction or limitation on ownership and transfer of our shares contained in our declaration of trust is no longer required for us to qualify as a REIT.

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Exhibit 21.1


Subsidiaries
Subsidiary
d/b/a
Jurisdiction
2016 JV Property Holdings, LLC
Delaware
2016 MHC, LLC
Delaware
All Stor Asheville, LLC
Delaware
All Stor Carolina Beach, LLC
Delaware
All Stor Durham, LLC
Delaware
All Stor Indian Trail, LLC
Delaware
All Stor MH
Delaware
All Stor NC, LLC
Delaware
All Stor Prospect, LLC
Delaware
All Stor Swansboro, LLC
Delaware
All Stor Swansboro II, LLC
Delaware
Allen Storage Partners LLC
StoreMore Self Storage
Texas
American Mini Storage-San Antonio, LLC
Delaware
Banning Storage, LLC
StoreMore Self Storage
Nevada
Bend-Eugene Storage, LLC
Oregon
Big Bend Xpress Holdings, LLC
Florida
Big Bend Xpress Storage, LLC
Florida
Bishop Road Mini Storage, LLC
Washington
Broadway Storage Solutions, L.L.C.
Arizona
Buck Investors, LP
Pennsylvania
Bullhead Freedom Storage, L.L.C.
StoreMore Self Storage; Freedom Storage
Arizona
Chelmsford, LLC
Delaware
Corona Universal Self Storage, a California Limited Partnership
California
Eagle Bow Wakefield, LLC
Eagle Storage
Delaware
Eastpointe Storage, LLC
Delaware
Fletcher Heights Storage Solutions, L.L.C.
Arizona
Fontana Universal Self Storage, a California Limited Partnership
California
Forest Grove Mini Storage, LLC
Oregon
Forney Storage Partners LLC
StoreMore Self Storage
Texas
GAK, LLC
Cypress Mini Storage
California
Grand Prairie Storage Partners LLC
StoreMore Self Storage
Texas
Great American Storage Partners, LLC
Great America Storage
Delaware
Gresham Storage, LLC
Oregon
Hesperia Universal Self Storage, a California Limited Partnership
California
Hide Away SPE, LLC
Delaware
Hide Away Storage Holdings, LLC
Delaware
Highway 97 Mini Storage, LLC
Oregon
Highway 99 Mini Storage, LLC
Oregon
ICDC II, LLC
Oregon
iStorage JV, LLC
Delaware
iStorage JV Bridgewater, LLC
Delaware
iStorage JV DuPont Highway, LLC
Delaware
iStorage JV Hickman Road, LLC
Delaware
iStorage JV Rancho Cordova, LLC
Delaware
iStorage JV Ridge Road, LLC
Delaware
iStorage JV Sunrise Monier, LLC
Delaware
iStorage Mezz, LLC
Delaware
iStorage PO, LLC
Delaware
iStorage TRS JV, LLC
Delaware
Keepers Storage, LLC
Washington
Lewisville Storage LLC
Washington


Loma Linda Universal Self Storage, a California Limited Partnership
California
Madison Brookhaven, LLC
Delaware
Madison Eagle Drive, LLC
Delaware
Mini I, Limited
California
Moove In Partners-Lancaster, L.P.
Pennsylvania
Moove-in of New Jersey, LLC
Wyoming
Moovein Properties II, LLC
Wyoming
Moovein, LLC
Wyoming
Murphy Storage Partners LLC
StoreMore Self Storage
Texas
National Storage Affiliates Management Company,
      LLC
Delaware
National Storage Insurance Solutions, Inc.
Delaware
Northwest II Chief Manager, LLC
Delaware
NSA Acquisition Holdings, LLC
Delaware
NSA All Stor, LLC
Delaware
NSA All Stor Chief Manager, LLC
Delaware
NSA Americor Holdings, LLC
Delaware
NSA Buck GP, LLC
Delaware
NSA BV DR, LLC
Delaware
NSA Colton DR GP, LLC
A-1 Self Storage; StorAmerica Arcadia; El Camino Self Storage; All American Self Storage
Delaware
NSA Colton DR, LLC
Plano Self Storage; Crown Valley Self Storage; Paramount Self Storage; StorAmerica Duarte
Delaware
NSA Fanning Springs, LLC
Delaware
NSA GSC DR GP, LLC
Irvine Self Storage
Delaware
NSA GSC DR, LLC
StorAmerica Palm Springs I; Carlsbad Airport Self Storage; StorAmerica Indio
Delaware
NSA HHF JV, LLC
Delaware
NSA HHF JV Tennessee Holdco, LLC
Delaware
NSA HHF Member, LLC
Delaware
NSA HHF Non-Member Manager, LLC
Delaware
NSA HHF TRS, LLC
Delaware
NSA iStorage Member, LLC
Delaware
NSA iStorage TRS Member, LLC
Delaware
NSA Lancaster GP, LLC
Delaware
NSA MGMT CO GP, LLC
Delaware
NSA Northwest CMBS II, LLC
Delaware
NSA Northwest Holdings II, LLC
Old Mill Self Storage; AllStar Storage; A-1 Westside Storage
Delaware
NSA Northwest Holdings, LLC
Delaware
NSA OP, LP
Delaware
NSA OV PM, LLC
Delaware
NSA PM, LLC
Delaware
NSA Property Holdings, LLC
Delaware
NSA SecurCare CMBS I, LLC
Delaware
NSA SecurCare Holdings, LLC
Delaware
NSA Security Storage, LLC
NSA Security, LLC
Delaware
NSA SS PM, LLC
Delaware
NSA Storage Solutions, LLC
Delaware
NSA TRS, LLC
Delaware
NSA Tustin Gateway GP, LLC
Delaware
NSA Universal DR, LLC
Delaware
NSA Villages Storage GP, LLC
Delaware
NSA-C Holdings, LLC
StorAmerica Hawaiian Gardens; StorAmerica Victorville-2; Statewide Storage; Country Club Self Storage
Delaware
NSA-Colton Holdings, LLC
Delaware


NSA-G Holdings, LLC
StorAmerica Montclair; Allsafe Freeway Storage; Leave It/Lock It Self Storage; StorAmerica Ontario; StorAmerica Palm Desert; StorAmerica Oceanside; StorAmerica Victorville
Delaware
NSA-GSC Colton Holdings, LLC
Delaware
NSA-GSC Holdings, LLC
Delaware
NSA-Northwest II, LLC
Delaware
NSA-Optivest Acquisition Holdings, LLC
StoreMore Self Storage; Fort Mohave Storage
Delaware
NSA-Optivest, LLC
Delaware
NSA-SecurCare Acquisition Holdings, LLC
Delaware
NSA-SecurCare, LLC
Delaware
NWSS Stor Rite LLC
Oregon
Oklahoma Self Storage GP, LLC
Delaware
Oklahoma Self Storage LP
SecurCare Self Storage
Colorado
Optivest Storage Partners of Austin, LLC
StoreMore Self Storage
Texas
PCB South, LLC
Florida
Rev Smart, L.P.
Florida
Safegard Mini Storage, LLC
Oregon
SAG Arcadia, LP
California
SAP-II YSI #1,LLC
Delaware
SecurCare American Portfolio, LLC
Delaware
SecurCare American Properties II, LLC
Delaware
SecurCare Colorado III, LLC
SecurCare Self Storage
Delaware
SecurCare Fayetteville I, LLC
Delaware
SecurCare Moreno Valley, LLC
Delaware
SecurCare Moveit McAllen, LLC
Move It Self Storage
Delaware
SecurCare Oklahoma I, LLC
SecurCare Self Storage
Delaware
SecurCare Oklahoma II, LLC
SecurCare Self Storage
Delaware
SecurCare Portfolio Holdings, LLC
Delaware
SecurCare Properties I, LLC
SecurCare Self Storage
Delaware
SecurCare Properties II R, LLC
SecurCare Self Storage
Delaware
SecurCare Properties II, LLC
SecurCare Self Storage
Delaware
SecurCare Value Properties R, LLC
SecurCare Self Storage
Delaware
Series Americor Insurance Company, a series of Endeavor Assurance Company, LLC
Delaware
Shreve Storage Equities, L.L.C.
Louisiana
Simply Storage Caguas, LLC
Louisiana
Simply Storage Clarksville, LLC
Delaware
Simply Storage Franklin, LLC
Delaware
Simply Storage Gallatin, LLC
Delaware
Simply Storage Harrah Drive, LLC
Delaware
Simply Storage Hendersonville, LLC
Delaware
Simply Storage Hermitage, LLC
Delaware
Simply Storage Maddox Simpson Parkway, LLC
Delaware
Simply Storage Mezz, LLC
Delaware
Simply Storage Partners REIT II LLC
Delaware
Simply Storage Quarry Loop Road, LLC
Delaware
Simply Storage White House, LLC
Delaware
Southern Self Storage, LLC
Florida
Southern Self Storage of Arizona, LLC
Arizona
Southern Self Storage of Florida, LLC
Florida
Southern Self Storage of Grayton, LLC
Florida
Southern Self Storage of PCB, LLC
Florida
Southern Self Storage of Pensacola, LLC
Florida
Springfield Mini Storage, LLC
Oregon
Square Foot Springhill, LLC
Ohio
SS 22195 Timberlake Road, LLC
Delaware
SS 8117 Timberlake Road, LLC
Delaware
SS Bayport, LLC
Delaware


SS Beeline, LLC
Delaware
SS Billy Williamson Drive, LLC
Delaware
SS Bloomfield, LLC
Delaware
SS Blue Ash, LLC
Delaware
SS Brighton MA, LLC
Delaware
SS Brookside, LLC
Delaware
SS Catano, LLC
Delaware
SS Chevoit, LLC
Delaware
SS Cleveland Heights, LLC
Delaware
SS Cliffwood, LLC
Delaware
SS Deerfield, LLC
Delaware
SS Detroit, LLC
Delaware
SS Downtown Tulsa, LLC
Delaware
SS Eastpointe II, LLC
Delaware
SS Ferndale, LLC
Delaware
SS Fields Ertel, LLC
Delaware
SS Forest Park, LLC
Delaware
SS Fort Walton Beal Parkway, LLC
Delaware
SS Fort Walton Harrelson Drive, LLC
Delaware
SS Glenview, LLC
Delaware
SS Greensville, LLC
Delaware
SS Guaynabo, LLC
Delaware
SS Hall Road, LLC
Delaware
SS Hargrove Drive, LLC
Delaware
SS Hiawatha II, LLC
Delaware
SS Highland Park, LLC
Delaware
SS Highway 150, LLC
Delaware
SS Highway 280, LLC
Delaware
SS Hingham, LLC
Delaware
SS Hoffman Estates, LLC
Delaware
SS Huber Heights, LLC
Delaware
SS Ivy Hill, LLC
Delaware
SS Ivy Hill, LP
Pennsylvania
SS Kettering, LLC
Delaware
SS Kingsland, LLC
Delaware
SS Lakeside Drive, LLC
Delaware
SS Lincoln Park, LLC
Delaware
SS Macon Road, LLC
Delaware
SS MAMNOH, LLC
Delaware
SS Mezz, LLC
Delaware
SS Michigan, LLC
Delaware
SS Midtown Tulsa, LLC
Delaware
SS Millville, LLC
Delaware
SS Minnesota II, LLC
Delaware
SS MITX, LLC
Delaware
SS MNMI, LLC
Delaware
SS MNRI, LLC
Delaware
SS Moellering, LLC
Delaware
SS North Bend, LLC
Delaware
SS North Fort Myers, LLC
Delaware
SS Norwood, LLC
Delaware
SS Palm City, LLC
Delaware
SS Peake Road, LLC
Delaware
SS Ponce, LLC
Delaware
SS Reading, LLC
Delaware
SS Riverside Drive, LLC
Delaware
SS San Juan, LLC
Delaware
SS Sheridan, LLC
Delaware


SS South Amherst, LLC
Delaware
SS South Euclid, LLC
Delaware
SS Storage Court, LLC
Delaware
SS Titusville Access, LLC
Delaware
SS Toa Baja, LLC
Delaware
SS Trinity Church, LLC
Delaware
SS Ward and Citation, LLC
Delaware
SS West Point, LLC
Delaware
SS Whitesville Road, LLC
Delaware
SS Williamstown, LLC
Delaware
SS Yale, LLC
Delaware
Storage Management and Leasing Co. LLC
Florida
Storage Management and Repair Co., LLC
Florida
StoreMore Self Storage-Pecos Road, LLC
StoreMore Self Storage
Delaware
Supreme Storage, LLC
Oregon
Terrell Storage Partners, LLC
StoreMore Self Storage
Texas
Town Center Self Storage, LLC
Colorado
Troutdale Mini Storage, LLC
Oregon
Tustin Gateway LP
California
Universal Self Storage Hesperia LLC, a California limited liability company
California
Universal Self Storage Highland, a California Limited Partnership
California
Universal Self Storage San Bernardino LLC, a California limited liability company
California
Upland Universal Self Storage, a California Limited Partnership
California
Villages Storage Partners, Ltd.
Florida
Washington Murrieta II, LLC
StorAmerica Scottsdale
California
Washington Murrieta III, LLC
StorAmerica Phoenix 24th
Arizona
Washington Murrieta IV, LLC
StorAmerica Phoenix 52nd
California
WCAL, LLC
StoreMore Self Storage
Texas


Exhibit 23.1

Consent of Independent Registered Public Accounting Firm


The Board of Trustees
National Storage Affiliates Trust:

We consent to the incorporation by reference in the registration statements on Form S-3 (No. 333-223654) and Form S-8 (No. 333-208602) of National Storage Affiliates Trust of our reports dated February 26, 2020, with respect to the consolidated balance sheets of National Storage Affiliates Trust as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive income (loss), changes in equity, and cash flows for each of the years in the three-year period ended December 31, 2019, and the related notes, Schedule III – Real Estate and Accumulated Depreciation (collectively, the consolidated financial statements), and the effectiveness of internal control over financial reporting as of December 31, 2019, which reports appear in the December 31, 2019 annual report on Form 10-K of National Storage Affiliates Trust.

/s/ KPMG LLP

Denver, Colorado
February 26, 2020


Exhibit 31.1
Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Tamara D. Fischer, certify that:
1.I have reviewed this Annual Report on Form 10-K of National Storage Affiliates Trust;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of trustees (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 26, 2020
By: /s/ Tamara D. Fischer
Tamara D. Fischer
President and Chief Executive Officer



Exhibit 31.2

Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Brandon S. Togashi, certify that:
1.I have reviewed this Annual Report on Form 10-K of National Storage Affiliates Trust;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of trustees (or persons performing the equivalent functions):
(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 26, 2020
By: /s/ Brandon S. Togashi
Brandon S. Togashi
Chief Financial Officer



Exhibit 32.1

Certification, Chief Executive Officer and Chief Financial Officer Pursuant To
18 U.S.C. Section 1350,
as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of National Storage Affiliates Trust (the “Company”) on Form 10-K for the period ended December 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Tamara D. Fischer, President and Chief Executive Officer of the Company, and I, Brandon S. Togashi, Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: February 26, 2020

By: /s/ Tamara D. Fischer
Tamara D. Fischer
President and Chief Executive Officer
By: /s/ Brandon S. Togashi
Brandon S. Togashi
Chief Financial Officer


Pursuant to the Securities and Exchange Commission Release 33-8238, dated June 5, 2003, this certification is being furnished and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference in any registration statement of the Company filed under the Securities Act of 1933, as amended.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.