Public Storage

Natural and catastrophic events · Pandemic and public health crises

Our business is subject to risks from public health and other crises like the COVID-19 pandemic, including, among others: risk of illness or death of our employees or tenants; negative impacts on economic conditions in our markets, which may reduce the demand for self-storage; risk that there could be an out-migration of population from major markets where we operate.

Natural and catastrophic events · Natural disasters and extreme weather

Natural disasters, such as earthquakes, fires, hurricanes, drought, extreme temperatures and floods, terrorist attacks, civil unrest, and other events that damage our facilities or our tenants' property, or that make our facilities temporarily unavailable, have in the past and may in the future adversely impact our business and financial results.

Economic and market conditions · Inflation and deflation pressures

We could be subject to increases in property or other taxes, repair and maintenance costs, payroll, utility costs, insurance premiums, workers compensation, and other operating expenses due to various factors such as inflation, labor shortages, commodity and energy price increases, weather, increases to minimum wage rates, supply chain disruptions, and changes to governmental safety and real estate use limitations.

Geopolitical and trade · Political instability and government changes

Shurgard is subject to a variety of local, national, and pan-European laws and regulations related to permitting and land use, the environment, labor, and other areas, as well as income, property, sales, and value added and employment tax. These laws and regulations can be difficult to apply or interpret, can vary in each country or locality, and are subject to unexpected changes in their form and application due to regional, national, or local political uncertainty and other factors.

Geopolitical and trade · Regulatory and policy uncertainty

Local, state, and federal governments have and may in the future adopt regulations that could adversely impact our operations, including in response to natural disasters and public health crises. For example, in response to wildfires in 2018, 2019, and early 2025 and floods in 2023, the State of California and some localities in California adopted temporary regulations that imposed certain limits on the rents we could charge at certain of our facilities and the extent to which we could increase rents to existing tenants.

Social and demographic · Demographic pattern changes

Shifts in population and demographics could cause the geographical distribution of our portfolio to be suboptimal and affect our ability to maintain occupancy and attract new customers.

Supply chain and procurement · Raw material availability and cost volatility

International trade disputes, including threatened or implemented tariffs imposed by the U.S. and threatened or implemented tariffs imposed by foreign countries in retaliation, could result in inflationary pressures that directly impact our costs, such as costs for steel, lumber and other materials applicable to our development and redevelopment projects.

Human capital and workforce · Labor relations and union negotiations

Collective bargaining, which is prevalent in certain areas in Europe, could negatively impact Shurgard's labor costs or operations. Many of Shurgard's employees participate in various national unions.

Core operations · Operational disruption and business continuity

Damage and business interruption losses could exceed the aggregate limits of our insurance coverage. In addition, because we self-insure a portion of our risks, losses below a certain level may not be covered by insurance.

Credit and liquidity · Access to capital and financing

Elevated interest rates also adversely impact the relative attractiveness of the dividend yield on our common shares. Increases in our cost of capital impact our assessment of the yields we consider appropriate to support pursuing property acquisition and development opportunities and thus can impact our external growth prospects.

International and currency · International operations and emerging markets

Shurgard, as an owner, operator, and developer of self-storage facilities, is subject to many of the same risks we are with respect to self-storage. However, through our investment in Shurgard, we are exposed to additional risks unique to the various European markets in which Shurgard operates, which may adversely impact our business and financial results.

International and currency · Foreign exchange and currency exposure

Currency fluctuations can impact the fair value of our investment in Shurgard, our equity earnings, our ongoing dividends, and any other related repatriations of cash.

Credit and liquidity · Credit risk and customer defaults

We may record losses as a result of the bankruptcy, insolvency, or other credit failure of the borrowers under our bridge lending financing program. Although we conduct due diligence and aim to carefully evaluate the risks associated with this debt and other investments, we could incur losses from our lending decisions, which includes subjective and complex judgments and forecasts of economic conditions and how these economic predictions might impair the ability of our borrowers to operate their business and/or make all required payments.

Capital structure and performance · Dividend policy and capital allocation

Holders of our preferred shares are entitled to cumulative dividends before any dividends may be declared or set aside on our common shares. Upon liquidation, holders of our preferred shares will receive a liquidation preference of $25,000 per share (or $25.00 per depositary share) plus any accrued and unpaid distributions before any payment is made to the common shareholders. These preferences may limit the amount received by our common shareholders either from ongoing distributions or upon liquidation.

Market and investment · Asset valuation and impairment

We may incur significant liabilities from environmental contamination or moisture infiltration. We may not have detected all material liabilities, we could acquire properties with material undetected liabilities, or new conditions could arise or develop at our properties, any of which could result in a cash settlement or adversely affect our ability to sell, lease, operate, or encumber affected facilities.

Industry regulation · Regulatory compliance and changes

Shurgard is subject to a variety of local, national, and pan-European laws and regulations related to permitting and land use, the environment, labor, and other areas, as well as income, property, sales, and value added and employment tax.

Tax and financial reporting · Tax compliance and changes in tax law

We would incur adverse tax consequences if we failed to qualify as a REIT, and we would have to pay substantial U.S. federal corporate income taxes. A qualifying REIT does not generally incur U.S. federal corporate income tax on its 'REIT taxable income' that it distributes to its shareholders. However, there can be no assurance that we qualify or will continue to qualify as a REIT, because of the highly technical nature of the REIT rules, the ongoing importance of factual determinations, the possibility of unidentified issues in prior periods, or changes in our circumstances.

Tax and financial reporting · Financial reporting and accounting standards

Dividends payable by REITs do not qualify for the preferential tax rates available for some dividends. Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations. The maximum U.S. federal income tax rate for qualified dividends paid by domestic non-REIT corporations to U.S. stockholders that are individuals, trusts, or estates is generally 20%.

Strategic execution · Merger acquisition and divestiture risks

We have acquired self-storage facilities and self-storage operating companies in the past, and we expect to continue to do so in the future. Failures or unexpected circumstances in integrating facilities or companies that we acquire, or circumstances we did not detect or anticipate during due diligence, such as environmental matters, needed repairs or deferred maintenance, customer collection issues, assumed liabilities, turnover of critical personnel involved in acquired operating companies, or the effects of increased property tax following reassessment of a newly-acquired property, could jeopardize realization of the anticipated earnings from an acquisition.

Market position and competition · Pricing pressure and margin compression

Marketing initiatives, including our increasing dependence on Google to source customers, may fail to be effective and could negatively impact financial performance. More than half of our new storage customers in 2025 were sourced directly or indirectly through 'unpaid' search and 'paid' search campaigns on Google. Google is providing tools to allow smaller and less sophisticated operators to bid for search terms, increasing competition for self-storage search terms.