National Storage Affiliates Trust Q4 Earnings Call Highlights

National Storage Affiliates Trust (NYSE:NSA) executives said fourth-quarter results and early 2026 operating trends indicate the company’s self-storage portfolio has “clearly turned the corner,” citing improving same-store revenue trends, stabilizing occupancy and continued benefits from multi-year operational initiatives following its PRO internalization.

Portfolio trends improved through the fourth quarter

President and CEO David Cramer said the fourth quarter provided “further confirmation” that portfolio performance has inflected positively, with sequential improvement across most markets. He noted that all but one of NSA’s 21 reported MSAs showed improvement in same-store revenue growth versus the third quarter.

For the fourth quarter, CFO Brandon Togashi reported same-store revenue declined 0.7%, an improvement from a 2.6% decline in the third quarter. Togashi said the fourth-quarter revenue change was driven by lower average occupancy of 120 basis points, partially offset by 100 basis points of year-over-year growth in average revenue per occupied square foot. Nine of 21 markets posted positive same-store revenue growth in the quarter.

Occupancy trends also improved, management said. Cramer reported year-over-year occupancy finished 2025 down 70 basis points, compared with down 140 basis points at the end of the third quarter. He added that January end-of-month occupancy was up 20 basis points year-over-year, with the improvement continuing into February.

Core FFO reached the high end of guidance; marketing spending increased

NSA reported Core FFO per share of $0.57 for the fourth quarter and $2.23 for the full year, which Togashi said was at the high end of guidance and above consensus. Same-store revenues declined 2.3% for the full year, while same-store expenses rose 3.1% for the year, slightly below the low end of the company’s guidance range.

Expense control was a key theme. Fourth-quarter expenses declined 0.8%, with Togashi highlighting payroll costs down 4.1% in the quarter and 2.8% for the year as the company sought efficiencies in hours of operation and staffing.

At the same time, management emphasized increased investment in customer acquisition. Marketing spending rose 37% in the fourth quarter and 31% for the year, which Togashi said was focused on markets where the company “clearly” sees benefits. Cramer and executives repeatedly pointed to improved top-of-funnel activity and better conversion rates, aided by upgraded and centralized marketing, revenue management and operational platforms, as well as expanded use of AI-driven modeling.

Guidance calls for revenue improvement in 2026, with a modest Core FFO decline

NSA introduced 2026 guidance with midpoints that include 0.9% same-store revenue growth, 3% same-store operating expense growth, flat same-store NOI growth, and Core FFO per share of $2.19. Togashi said the company expects same-store revenue growth to steadily improve over the next couple of quarters, and he described fourth-quarter same-store revenue performance as becoming less negative through the quarter and “trending towards flattish” by quarter-end.

Management attributed the expected year-over-year improvement to a combination of factors, including positive year-over-year occupancy early in 2026, stable pricing conditions, strong rental volume and a more assertive approach to ECRI (existing customer rate increases). Cramer said contract rate growth improved in the back half of 2025 and is expected to remain solid in 2026, while emphasizing the company is “not undercutting markets” and is maintaining its competitive positioning on rates and promotions.

Togashi said the midpoint Core FFO per share decline of about $0.04 is driven by:

• Approximately $0.02 of higher G&A, primarily from assuming target-level cash incentive compensation after below-target levels in 2025.
• About $0.02 from a combination of debt refinancing headwinds and a tougher comparison for the company’s insurance captive following favorable fourth-quarter 2025 results.

On expenses, Togashi said property taxes are expected to rise 3% to 5%, personnel costs are expected to be “flattish” year-over-year, marketing expense is expected to continue rising (though not at 2025’s 30%+ pace), and insurance costs are forecast to decrease year-over-year, with the company viewing the market as improved ahead of its April 1 renewal.

Balance sheet, maturities, and transaction activity

NSA ended the quarter with net debt to EBITDA of 6.6x, which Togashi said is slightly above the company’s long-term 5.5x to 6.5x target range, and leverage “continues to come down.” He added that at the midpoint of guidance, leverage is expected to remain relatively similar by year-end 2026, with capital deployment influencing quarterly movements.

Liquidity and refinancing were also discussed. Togashi said NSA has $375 million of maturities in 2026, including a $275 million term loan due in July and $100 million of unsecured notes due in May and October. The company expects to most likely address the maturities with a new term loan, and it has a revolver balance of about $400 million, leaving $550 million of availability. In response to a question, Togashi said the blended rate on the $375 million of maturities is about 4.25%, and refinancing could result in a reset to the mid-to-high 4% range depending on structure, creating a partial-year interest expense headwind in 2026. He also noted one joint venture has about $360 million of debt due in October at a 3.5% in-place rate, with refinancing incorporated into guidance based on NSA’s 25% share.

On transactions, Togashi said NSA sold three assets for $24 million during the quarter. After quarter-end, the company sold three additional properties for $21 million and acquired one wholly owned property for $10 million. For 2026, the company guided to $50 million to $150 million of acquisitions and $50 million to $150 million of dispositions (NSA share). Executives said the portfolio optimization program will remain active in 2026, with on-balance sheet investments largely used to satisfy 1031 requirements. Cramer later said the company has done the “majority of the heavy lifting” on the optimization program, with future activity more opportunistic.

Operational focus: ECRI, move-in rates, and market-level differences

Executives described a push to improve revenue management and conversion, including discounting and tenant-insurance upsell decisions during the rental process. Togashi said “other property-related income” (including retained tenant insurance dollars at the store level) was a drag and is expected to remain a drag in 2026 because the company has adjusted at-the-time-of-rental upsell tactics to prioritize securing rentals; the comparison becomes easier mid-year.

On move-in rates, Cramer said move-in rate trends narrowed in the fourth quarter, but he expects move-in rates to be negative for the first four or five months of 2026 due to tough comparisons tied to street-rate resets during the PRO internalization period. He said move-in rates should return to a more neutral-to-positive position beginning around June or July.

Cramer also said the cadence of ECRI actions has not changed, but the magnitude of increases has risen year-over-year as management has grown more confident in its customer acquisition and marketing platform. He added that average square feet per rental had previously rolled down by roughly five to six square feet per rental but has since recovered to flat or slightly higher, a trend he said flipped around September and held through February.

Market-by-market, executives said some areas are demonstrating pricing power and better fundamentals, while heavy supply markets remain more challenged. Cramer cited markets such as Wichita, Colorado Springs and Portland as examples where supply and demand are “in check,” supporting pricing and ECRI performance. By contrast, he pointed to markets including Phoenix and Atlanta, as well as parts of Florida’s Gulf Coast, as areas where supply remains a key headwind.

On the dividend, Cramer said guidance implies the company will not fully cover the dividend in 2026, but he expects coverage to improve toward the back half of the year, potentially reaching full coverage “towards the back half, really, the fourth quarter of the year,” with further improvement possible in 2027 if fundamentals continue to strengthen.

About National Storage Affiliates Trust (NYSE:NSA)

National Storage Affiliates Trust is a publicly traded real estate investment trust (REIT) focused on the ownership and operation of self-storage properties in the United States. Since its initial public offering in August 2015, NSA has pursued a growth strategy built on strategic acquisitions and partnerships, establishing a diversified portfolio of assets backed by a centralized support platform. The Trust’s model combines the scalability of a national REIT with the local expertise of affiliate operators.

The company’s core business involves providing flexible storage solutions to both individual and commercial customers.