Strategic Storage Trust Inc., a publicly registered, non-traded real estate investment trust (REIT) investing in self-storage properties, announced its third-quarter 2012 financial results. The company had a 5.5 percent increase in same-store revenue and an 8.5 percent increase in net operating income (NOI) compared to the third quarter of 2011.
The increase in same-store revenue was primarily attributed to an increase in average occupancy of approximately 400 basis points and an increase in tenant-insurance revenue due to increased penetration rates. The average occupancy of 83 percent in the quarter was an improvement from 79 percent during the same quarter last year.
Same-store NOI improved due to the revenue increases combined with a decrease in property-operating expenses as a percentage of revenue, company officials said.
Our third-quarter results reflect the positive impact of increased occupancy (stabilized and lease-up facilities), an increase in same-store revenues and net operating income, and an overall continued increase in economies of scale across our portfolio, said H. Michael Schwartz, CEO. We believe we are well positioned for future growth.
The company also increased IPA (Investment Program Association) modified funds from operations by 172 percent (approximately $1.7 million) during the quarter compared to the same period last year. The improvement was primarily attributed to sequential quarter improvements in same-store NOI of approximately $1.2 million.
Strategic Storage Trust also reported that cash flow from operation increased by 435 percent from $1.2 million for the nine months ended Sept. 30, 2011, to $6.4 million for the nine months ended Sept. 30, 2012.
The company acquired 17 properties during 2012 for a total of $82.4 million and completed the full pay-down of a $28 million KeyBank bridge loan.
The Strategic Storage Trust portfolio of wholly-owned properties includes 108 facilities in 17 states and Canada that are branded as SmartStop Self Storage. The portfolio includes approximately 70,000 self-storage units and 8.7 million square feet of rentable storage space.