National Storage Affiliates Trust
Q2 2025 Earnings
Market Reaction
Did NSA Beat Earnings? Q2 2025 Results
National Storage Affiliates turned in a mixed second quarter, narrowly missing earnings expectations while topping revenue forecasts against a backdrop of persistent industry headwinds. The self-storage REIT posted diluted EPS of $0.19, falling just short of the $0.19 consensus estimate, as revenue of $188.84 million edged 1.84% above expectations despite slipping 0.8% from the year-ago period. The central drag on results was a sharp deterioration in same-store performance, where average occupancy fell 240 basis points to 84.2% and same-store NOI declined 6.1%, pressured by weak demand tied to sluggish existing home sales and persistent supply growth in Sunbelt markets. Core FFO dropped 11.3% per share to $0.55, reflecting lower NOI and higher interest costs. Management responded by meaningfully cutting its full-year 2025 outlook, lowering Core FFO per share guidance to $2.17-$2.23 from a prior $2.30-$2.38 and shifting same-store NOI growth expectations to a range of -5.75% to -4.25%, signaling that a recovery in fundamentals remains elusive near term.
- Same store NOI declined 6.1% driven by 3.0% revenue decrease and 4.6% property operating expense increase
- Average occupancy declined 240 basis points year-over-year to 84.2%
- Average annualized rental revenue per occupied square foot declined 0.3%
- Low existing home sales and ongoing supply pressure, especially in Sunbelt markets
- Elevated use of concessions drove rental volume but negatively impacted near-term revenues
- Interest expense increased to $41.3 million from $37.2 million year-over-year
- Management fees and other revenue increased $2.7 million year-over-year to $12.2 million
- General and administrative expenses decreased $3.4 million year-over-year following PRO internalization
- Portland, Houston, and San Juan outperformed portfolio average same store revenue growth
- Riverside-San Bernardino, Atlanta, and Phoenix underperformed portfolio average
“During the second quarter, we realized sequential improvement from the prior quarter in the level of contract rate, occupancy and our rent roll-down spread. However, these positives were outweighed by continued softness in storage demand primarily driven by low existing home sales and ongoing supply pressure, especially in our Sunbelt markets, which also impacted the pace of realizing the benefits from the internalization of our PRO structure. Further, the elevated use of concessions during the quarter that drove rental volume has a near-term negative impact on revenues. The combination of these factors weighed on same store NOI and Core FFO results for the quarter and was the primary driver of our revised guidance ranges.”
National Storage Affiliates CEO, on the earnings call
Forward Guidance & Outlook
NSA lowered its full-year 2025 Core FFO per share guidance to $2.17-$2.23 from a prior range of $2.30-$2.38, primarily driven by lower same store growth assumptions. Same store total revenue growth is now expected at -3.0% to -2.0% (vs. prior -1.25% to +1.25%), property operating expenses growth at 3.25% to 4.25% (vs. prior 3.0% to 4.0%), and same store NOI growth at -5.75% to -4.25% (vs. prior -2.8% to 0.0%). Full-year 2025 diluted EPS is guided at $0.71-$0.74 (vs. prior $0.63-$0.69). Management fees and other revenue are expected at $49.0-$51.0 million. The company expects consolidated and joint venture acquisitions (at share) of $50.0-$100.0 million and dispositions of $100.0-$300.0 million for the full year.
NSA YoY Financials
NSA Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.