CubeSmart Q2 2026 Earnings Report

CubeSmart EPS Results

• Actual EPS: $0.39
• Consensus EPS: $0.64
• Beat/Miss: Missed by -$0.25
• One Year Ago EPS: $0.65

CubeSmart Revenue Results

• Actual Revenue: $286.49 million
• Expected Revenue: $281.12 million
• Beat/Miss: Beat by +$5.37 million
• YoY Revenue Growth: +1.50%

CubeSmart Announcement Details

• Quarter: Q2 2026
• Date: 7/30/2026
• Time: After Market Closes
• Conference Call Date: Friday, July 31, 2026
• Conference Call Time: 11:00AM ET

CubeSmart (NYSE:CUBE) (NYSE: CUBE) is a publicly traded real estate investment trust (REIT) specializing in the ownership, operation and management of self-storage facilities across the United States. The company’s portfolio comprises properties in primary and secondary markets, catering to both individual and business customers seeking flexible, short-term and long-term storage solutions. CubeSmart’s facilities feature a range of unit sizes, climate-controlled options and advanced security features, supported by on-site managers and centralized customer service operations.

In addition to traditional self-storage units, CubeSmart offers specialty services such as vehicle and boat storage, retail sales of packing and moving supplies, and tenant insurance programs. The company has also expanded its platform to include third-party management services for independently owned storage properties under the CubeSmart brand, leveraging technology and operational expertise to improve occupancy and revenue performance for partner owners.

Founded in 2004 as U-Store-It Trust, the company rebranded as CubeSmart in 2011 and is headquartered in Malvern, Pennsylvania. Under the leadership of Chairman and Chief Executive Officer Christopher F. Marr, CubeSmart has pursued an acquisition-driven growth strategy, targeting markets with strong population density and favorable demand drivers. The leadership team emphasizes operational efficiency, customer experience and disciplined capital allocation as key pillars of its long-term growth plan.

CubeSmart Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Operating trends improved: Same-store revenue growth accelerated to 0.8% in the second quarter from 0.6% in the first quarter, while move-in rates rose 1.7% year over year and the occupancy gap versus 2025 closed by quarter-end.
• Positive Sentiment: CubeSmart raised its full-year same-store revenue guidance to 0.5%-1.25% and expects moderating expense growth in the second half, supporting a return to positive same-store NOI and adjusted FFO-per-share growth later in 2026.
• Positive Sentiment: Capital allocation remained shareholder-focused: The company contributed 15 non-core assets to a new Heitman joint venture at cap rates in the mid-5% range, with proceeds supporting $42.5 million of second-quarter share repurchases and $75.8 million year to date.
• Positive Sentiment: The company cited steady customer credit quality, lower move-outs, longer customer stays, and diminishing new-supply pressure as drivers of its more optimistic outlook for continued improvement through 2026 and into 2027.
• Neutral Sentiment: Sun Belt markets remain the main area of weakness due to oversupply and macroeconomic pressure, with recovery expected to be gradual and highly dependent on individual markets; some locations, such as Fort Myers and parts of Texas and the Southwest, may take multiple years to normalize.

Presentation

[Operator]

Hello, everyone. Thank you for joining us, and welcome to the CubeSmart second quarter 2026 earnings call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. I will now hand the call over to Josh Schutzer, Senior Vice President of Finance. Josh, please go ahead.

[Josh Schutzer, SVP of Finance at CubeSmart]

Thanks, Sarah. Good morning, everyone. Welcome to CubeSmart's second quarter 2026 earnings call. Participants on today's call include Chris Marr, President and Chief Executive Officer, and Tim Martin, Chief Financial Officer. Our prepared remarks will be followed by a Q and A session. In addition to our earnings release, which was issued yesterday evening, supplemental operating and financial data is available under the investor relations section of the company's website at www.cubesmart.com. The company's remarks will include certain forward-looking statements regarding earnings and strategy that involve risks, uncertainties and other factors that may cause the actual results to differ materially from these forward-looking statements.

[Josh Schutzer, SVP of Finance at CubeSmart]

The risks and factors that could cause our actual results to differ materially from forward-looking statements are provided in documents the company furnishes to or files with the Securities and Exchange Commission, specifically the Form 8-K we filed this morning, together with our earnings release filed with the Form 8-K and the risk factors section of the company's annual report on Form 10-K. In addition, the company's remarks include reference to non-GAAP measures. A reconciliation between GAAP and non-GAAP measures can be found in the second quarter financial supplement posted on the company's website at www.cubesmart.com. I will now turn the call over to Chris.

[Chris P. Marr, President and CEO at CubeSmart]

Thank you, Josh, and thank you everyone for joining us this morning. 2026 marks a year of inflection as we return to positive growth throughout the year. Following a stabilization in operating fundamentals in 2025, we saw same-store revenues inflect positively in early 2026. Our base case expectation is for continued acceleration in revenues that will lead to a return to positive earnings growth in the second half of 2026, providing a strong setup entering 2027.

[Chris P. Marr, President and CEO at CubeSmart]

Our key performance indicators are flashing green, showcasing the resilience of the self-storage business and the value of having such a wide range of need-based demand for our product, benefiting us from not being overly reliant on any one source. Same-store revenues continue their positive momentum, reflecting the strength of our customer base, the declining impact of new supply in many of our core markets, and the quality of our portfolio and operating platform.

[Chris P. Marr, President and CEO at CubeSmart]

Macro volatility is impacting the U.S. consumer. However, our customers' health remains strong, with lower vacate activity, elongating lengths of stay, and continued solid credit metrics. This environment continues to showcase the strength of our quality-focused strategy, with primary markets outperforming and showcasing their lower beta characteristics. We had a positive and productive spring and summer busy rental season, closing the occupancy gap to 2025 by the end of June, and that momentum has continued into July.

[Chris P. Marr, President and CEO at CubeSmart]

Second quarter move-in rates for new customers at a year-over-year positive 1.7%, improved sequentially by 80 basis points, and all other factors held constant, provides an attractive setup for the back half of the year and heading into 2027. There continues to be a wide dispersion in move-in rates for new customers across our major markets. Strength continues in the Acela Corridor, Boston, Stamford, New York and Philadelphia.

[Chris P. Marr, President and CEO at CubeSmart]

In the Midwest, Chicago, Columbus and Cleveland. Very positive improving trends in our West Coast markets with our Inland Empire and Los Angeles properties exhibiting very strong sequential improvement and swinging second quarter same-store revenue growth on a year-over-year basis back into positive territory. With another solid quarter of sequentially improving trends, we are optimistic for continued gradual recovery in our major Sun Belt markets. These markets are experiencing the most pressure from supply as well as macroeconomic factors impacting the consumer, resulting in a challenging new customer pricing environment. We have maintained our disciplined capital allocation strategy. During the quarter, we executed against several objectives we articulated earlier in the year, including a new joint venture, the continued execution of our share repurchase program. The recast and increased capacity in our credit facility.

[Chris P. Marr, President and CEO at CubeSmart]

I know Tim is very excited to share the details with you during his prepared remarks. As we come to the end of July, our rental volumes are elevated over last year. As of July 30, our same-store physical occupancy is 91.1%, a 30-basis point increase over July 30, 2025. Our pricing algorithms have informed us that it is optimal to maintain seasonal pricing trends and build physical occupancy as we move into the fall. Self-storage remains a tremendously resilient business as we continue to benefit from the diverse set of needs-based use cases for the product, even against a backdrop of volatile consumer confidence. We are optimistic about the outlook for our business as we continue to see steady acceleration and fundamentals.

[Chris P. Marr, President and CEO at CubeSmart]

Our high-quality portfolio, our sophisticated operating systems, and our customer service-focused team are well-positioned to continue to drive us forward as we inflect back to positive earnings growth in the second half of 2026. I'll now turn it over to Tim for more details on the quarter and our positively updated guidance ranges. Tim?

[Tim M. Martin, CFO at CubeSmart]

Thanks, Chris. Good morning, everyone. Thanks as always. We appreciate you taking the time to join us on the call today. Second quarter results were reflective of the positive environment that Chris touched on, with broad-based improvement across most markets as demand trends remain steady while headwinds from new supply continue to dissipate. Same store year-over-year revenue growth accelerated from 0.6% in the first quarter to 0.8% in the second quarter. Move-in rates grew 1.7% year-over-year, while the occupancy gap improved to flat by the end of the quarter. Those stabilizing trends and first half results led us to improving our full- year same store revenue guidance range to a new range of 0.5%-1.25%, which implies at the midpoint our expectation that same store revenue growth will continue to accelerate in the back half of the year.

[Tim M. Martin, CFO at CubeSmart]

Same store operating expenses grew 4.4% over last year, in line with our expectations. As we previously discussed, we had some tough expense comps after four straight years of industry-leading expense control, especially in the first half of the year. We modestly improved our full- year guidance range for same store expenses to a new range of 3.25%-4.5%, reflecting our expectation of moderating expense growth in the back half of the year. Revenue growth of 0.8%, combined with 4.4% expense growth yielded negative 0.7% same store NOI growth for the quarter. We reported FFO per share as adjusted of $0.63 for the quarter, which was at the midpoint of our guidance entering the quarter.

[Tim M. Martin, CFO at CubeSmart]

As discussed last quarter, we continue to execute on our disciplined capital allocation strategy, looking for creative ways to create shareholder value in an environment that continues to have a disconnect between public and private market valuations. We announced last evening a new joint venture with Heitman, where we will be contributing 15 non-core assets to a newly formed joint venture in which we'll have a 20% ownership stake.

[Tim M. Martin, CFO at CubeSmart]

The contributed assets were identified as non-core, meaning either they were in isolated markets or they were in outer ring locations in core markets. This transaction allows us to unlock value at a market rate for these assets, continue to participate in upside potential through both future growth as well as fees with a partner we have a very long and successful history with. It also improves the overall quality of our on-balance sheet portfolio.

[Tim M. Martin, CFO at CubeSmart]

This initial transaction in the venture provides the seed portfolio with the opportunity to grow in the future, giving us yet another avenue for future external growth in addition to our on-balance sheet activity, as well as our previously announced JV with CBRE. Proceeds from the transaction will be used to fund share repurchases, giving us a leverage-neutral opportunity to accretively invest in our shares as they trade at implied valuations that are disconnected from where high-quality storage assets are trading in the private market. We had additional share repurchases during the second quarter, totaling $42.5 million, bringing us to $75.8 million year to date, with much of that activity done with the Heitman JV in mind. The relative value of our portfolio has continued to make it our most attractive investment option.

[Tim M. Martin, CFO at CubeSmart]

On the third-party management front, we added 25 stores to the platform in the second quarter and ended the quarter with 872 third-party stores under management. Also, during the quarter, we closed on our extended and expanded revolving credit facility, extending the maturity from February of 2027 to June of 2030. We increased the capacity of the facility from $850 million to $1 billion and improved the pricing. Quick thank you to our entire high-quality bank group. We always appreciate your continued support. Our balance sheet's in great shape. We have a bond that matures next quarter, and we've been actively monitoring the debt markets and will continue to do so in the coming months. The expanded capacity on the revolver, combined with no debt maturities in 2027, gives us a lot of flexibility as we navigate through the next several quarters.

[Tim M. Martin, CFO at CubeSmart]

Details of our 2026 earnings guidance and related assumptions were included in our press release last evening. Big picture, operating fundamentals continue to improve across most markets. Demand trends are steady. Headwinds from new supply continue to dissipate. We saw improvements in move-in rates as well as occupancy levels, and our customers remain strong with lower vacate activity, elongating lengths of stay, and no change to credit metrics. Our baseline expectation is for continued gradual improvement in top line growth for the balance of 2026. Our same store expense guidance implies lower expense growth for the rest of the year. The midpoint of our same store NOI range implies returning to positive growth in the second half of the year, and the midpoint of our FFO per share's adjusted guidance range also implies returning to positive earnings growth in the back half.

[Tim M. Martin, CFO at CubeSmart]

When you add it all up, we feel great about where we're positioned and see positive trends that are leading to a really nice setup for us in 2027. Thanks again for joining us on the call this morning. At this time, Sarah, why don't we open up the call for some questions?

[Operator]

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. Please pick up your handset when asking a question. If you're muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Michael Griffin with Evercore ISI. Your line is open. Please go ahead.

[Michael Griffin, Analyst at Evercore ISI]

Great. Thanks so much. Chris, in your prepared remarks, you talked about some key performance indicators flashing green. I was wondering if you can expand on that. Is this just really move-in rents getting better year-over-year as a result of maybe better comps, more moderating supply, or is there anything on the organic demand side that you're seeing differently within the business right now?

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. Thanks, Michael. I think it's that full menu. We're seeing very good top-of-funnel demand with a diverse set of use cases for the product. We're continuing to see the existing customer health, as we mentioned, credit metrics, et cetera, be very positive. We're continuing to see those existing customers stay with us on their storage journey a bit longer each, as time goes by. We're seeing some good trends across the board, strength in the East Coast, in the middle part of the country. Some improving green shoots in the Sun Belt on customers' move-in rates. I think on the OpEx side, as Tim said, we're seeing the trends as we would've expected, get better as we go in the back half of the year. I think just broadly, feel very good about where we are at this point in the year.

[Michael Griffin, Analyst at Evercore ISI]

Thanks, Chris. That's some helpful context. Maybe Tim, I appreciated your prepared remarks around the new joint venture. Is there anything you can share in terms of pricing or cap rates that that deal transacted at? It seems like the near-term priority is the share repurchases. Are you seeing anything, I know you had the recently formed joint venture earlier this year, maybe to go on offense in terms of JVs? It doesn't seem like wholly owned on balance sheet acquisition pencil, but just curious how you weigh those proceeds being used for either share repurchases or potential acquisition opportunities in the future. Thank you.

[Tim M. Martin, CFO at CubeSmart]

Thanks, Michael. Yeah, I consider the share repurchases and the transaction that we just announced with Heitman to absolutely be playing offense. It's playing offense in the context of the environment that we're in. It gives us a great opportunity to be consistent with our operating strategy of improving the quality of our portfolio. It allows us to take advantage of being able to contribute these assets at a market valuation, which I would characterize to your first question in the mid-fives from a cap rate perspective. Being able to use those proceeds to take advantage of the disconnect of what we're seeing out there. That's a bit redundant to my prepared remarks, but that's the gist of the approach.

[Tim M. Martin, CFO at CubeSmart]

again, it gives us yet another vehicle to look at future growth opportunities along with Heitman now that we have this seed portfolio in this venture, gives us yet another path. I think the market is starting to open up and we're ready to get to that part of the offensive playbook as well, when the time's right for us.

[Michael Griffin, Analyst at Evercore ISI]

Great. Thanks so much.

[Tim M. Martin, CFO at CubeSmart]

Thank you.

[Operator]

Your next question comes from the line of Michael Goldsmith with UBS. Your line is open. Please go ahead.

[Michael Goldsmith, Analyst at UBS]

Good morning. Thanks a lot for taking my questions. Chris, in your prepared remarks, you sounded more optimistic than you've been in some time. You also talked about accelerating into strength into 2027. Can you talk a little bit about what it is specifically that's driving that? Also if you could talk a little bit about the cadence as it creates that setup for next year.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. Thanks, Michael. I am optimistic. The first part of the year here has been pretty strong and broad-based in terms of the demand. I think, again, to my comment, I think we've lost a little bit of our focus on how resilient the business is. It's everyday acts of life that create an opportunity for a customer to experience the joy of self-storage. I think we're just seeing that. I think we also have maybe lost a little bit of the focus on the fact that the number 1, 2, 3 issue for our industry is and always has been supply. I think what we're experiencing is we're really starting to see the benefits of that reduction in the impact of supply in many markets, right?

[Chris P. Marr, President and CEO at CubeSmart]

I can pick to Cape Coral, Florida, which may take years and years to finally overcome the burden of the amount of new deliveries there. As you take it broadly across, we're starting to Positive about the direction that we're moving here at Cube. I think we're also obviously seeing the positive impact of the highest quality portfolio that we have.

[Operator]

Ladies and gentlemen, we are experiencing some technical difficulties. Please hold. Ladies and gentlemen, thank you for your patience. We will now resume the broadcast. We have Michael Goldsmith on the line.

[Chris P. Marr, President and CEO at CubeSmart]

Michael, first of all, let me apologize for the technical problems. We're back. I don't know when I was disconnected there, Michael, because I was on fire. To just pick up on the back half of your question on cadence of timing. As we not going to pick a date specific, we see trends that have been very positive and those positive trends continuing. Whether that's at some point in the third quarter or the fourth quarter, on average, over the back half of the year, we do see a return to both positive cash flow growth and positive earnings growth.

[Operator]

Your next question comes from the line of Spenser Glimcher with CubeSmart. Your line is open. Please go ahead.

[Chris P. Marr, President and CEO at CubeSmart]

Spenser, I don't know if this can get any funnier. I don't know when you joined CubeSmart, welcome. Your onboarding will be next week. We'll have a little orientation for you.

[Spenser Glimcher, Analyst at CubeSmart]

Naturally, I have no questions then. Yeah. Just one for me. Regulation efforts aren't new to this sector, there's been slightly more success in passing through legislation on pricing transparency, and I just wanted to get your thoughts on the impact of the recent legislation passed in New York regarding surveillance pricing and whether or not this affects how you set prices in the New York metro.

[Chris P. Marr, President and CEO at CubeSmart]

Thanks, Spenser. The CubeSmart way, if you just think about how we operate, is we strongly with all of our stakeholders in all of the municipalities in which we operate or wish to operate, we believe in an open, professional, responsible, and reasonable dialogue with our stakeholders in those municipalities, whether that be around a proposed new development of self-storage and having a discussion about certainly why we would believe that self-storage in that location is an ideal use, or whether it be how we operate our stores in those markets and getting that feedback. The reality is, often, but not always, those are productive and healthy dialogues where we see everybody's point of view.

[Chris P. Marr, President and CEO at CubeSmart]

Specific to New York, but frankly, any municipality in which we operate, as long as that dialogue exists in a responsible and open way, we obviously want to listen to the points of view of the stakeholders, and we want to share our points of view with the hope we get to a reasonable place. As often in those discussions, it's ideal if both parties feel like they didn't get everything they wanted, but we reach a good meeting of the minds. I think as it specifically relates to that pricing, we will continue to look at how we price the tools that we used and be respectful of any sort of guardrails that are set up in the municipalities in which we operate.

[Spenser Glimcher, Analyst at CubeSmart]

Great. Okay. I appreciate that color. Thank you, guys.

[Chris P. Marr, President and CEO at CubeSmart]

Thanks.

[Operator]

Your next question comes from the line of Ravi Vaidya with Mizuho. Your line is open. Please go ahead.

[Ravi Vaidya, Analyst at Mizuho]

Hi. Good morning. Thanks for taking my question. Your guidance forecast a pretty significant moderation in expenses in the back half of the year. Which line items do you think are most likely to benefit here going forward? Thanks.

[Tim M. Martin, CFO at CubeSmart]

Hey, good morning. Thanks for the question. You have a couple of things going on there. If you'll recall from last quarter, we had some pretty heavy winter expenses that impacted the first quarter, so that created some pressure on the run rate. You also had, last quarter, a pretty big year-over-year increase in marketing spend, which had a lot to do with the timing of when we deployed marketing spend last year versus when we did this year. Some of our marketing spend was a little front-loaded this year. I think you'll see a moderation on those two line items. We had a successful property insurance renewal in May, so a little bit of that flows through to some lower property insurance premiums in the back half of the year.

[Tim M. Martin, CFO at CubeSmart]

I also touched on we expect a little bit of moderation on the personnel line item. It's not really one line item in particular. It's across a bunch of them, and it's just this year we happen to have a little bit of pressure when comparing year-over-year in the first half of the year, and if you look through the guidance, you nailed it. There's a pretty big moderation in expense growth, and appreciate you asking the question so I could say it again.

[Ravi Vaidya, Analyst at Mizuho]

Thank you. Appreciate it.

[Tim M. Martin, CFO at CubeSmart]

Thanks. Thank you.

[Operator]

Your next question comes from the line of Juan Sanabria with BMO Capital Markets. Your line is open. Please go ahead.

[Juan Sanabria, Analyst at BMO Capital Markets]

Hi. Good morning. Just to start, just curious if you could comment on the July move and trends and how that trended throughout the second quarter. Maybe if you could comment as part of that around when you expect to kind of return to the long-term same-store revenue growth trajectory. I believe previously you'd said the second half 2027, wondering if that gets pulled forward with your renewed enthusiasm.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. Thanks, Juan. When you think about July, as I mentioned in my prepared remarks, as of yesterday close, we were at a physical occupancy of 91.1%. That's 30-basis point increase over July 30 of 2025. Our rentals for the month of July were 3% higher than they were through the 30th of July last year. On the vacate side, our vacates are also negative 3%, down 3% from where we were through the 30th of July last year. On the cadence, obviously we continue to see, as I said, green lights that are encouraging and getting us very optimistic about next year. The exact pace and how we hit it is obviously going to be pretty varied based on a variety of factors. I think we just continue to see that steady growth.

[Chris P. Marr, President and CEO at CubeSmart]

We have that inflection to positive cash flow and earnings in the back half of this year, then continue to build off that each quarter through 2027.

[Juan Sanabria, Analyst at BMO Capital Markets]

Greg, could you just let us know what the July move-in rate was? Apologies if that wasn't clear.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. As I mentioned, our pricing systems are optimizing by leaning a bit more towards volume versus rate, which is a little bit different than this time last year. This has been built into our expectations. We would expect in our base case that early third quarter, we don't see growth year-over-year in asking rents, then those metrics return to positive as we get deeper into the third quarter and through Q4. I'll caveat all that with the fact that we price in real time, our strategy may change from week to week.

[Juan Sanabria, Analyst at BMO Capital Markets]

Appreciate it. Thank you.

[Chris P. Marr, President and CEO at CubeSmart]

Thanks.

[Operator]

Your next question comes from the line of Viktor Fediv with Scotiabank. Your line is open. Please go ahead.

[Viktor Fediv, Analyst at Scotiabank]

Thank you. Good morning, everyone. On the Heitman JV, should we think of this as a completion of broader portfolio optimization effort, or have you identified some additional assets that could be candidates for similar transactions in the near- term? What will be the capital structure of this JV, including expected leverage at the entity level?

[Tim M. Martin, CFO at CubeSmart]

Yeah, thanks for the question. That's it for now for us on finding opportunities to sell or contribute assets into a venture. I wouldn't consider this necessarily portfolio pruning. We really like our portfolio. This transaction was more geared towards in the current environment, what can we do to increase our ability to fund share repurchases in a way that's leverage neutral? This was a good opportunity for us to accomplish a number of things from a strategic standpoint, improving the quality of the portfolio, having an additional path for future external growth with a long-term partner in Heitman. From a leverage standpoint, the venture does expect to put leverage on the venture. The amount and the timing of that is still a little bit up in the air.

[Tim M. Martin, CFO at CubeSmart]

We don't expect to close on this until the fourth quarter, there's a little bit of time to settle all those moving pieces. It wouldn't surprise me if ultimately we ended up having somewhere in the neighborhood of 50% leverage on the venture, that's still to be decided.

[Viktor Fediv, Analyst at Scotiabank]

Understood. Thank you.

[Tim M. Martin, CFO at CubeSmart]

Thank you.

[Operator]

Your next question comes from the line of Todd Thomas with KeyBank. Your line is open. Please go ahead.

[Todd Thomas, Analyst at KeyBank]

Hi, thanks. I wanted to ask about occupancy, specifically you saw occupancy continue to build through quarter end, and commented that occupancy has increased slightly higher in July. Rentals up 3% in July too. Seems like the rental season's extended a bit further than prior years. Has the strength in rental activity persisted throughout the July period? Is there any sense whether that might continue into August, sort of up until, sort of the Labor Day weekend? Which I think historically has been more typical of the leasing season. Any sense what's driving the improving trends and really more of this traditional leasing season versus some of the more prior years?

[Chris P. Marr, President and CEO at CubeSmart]

Thanks. The trends we have seen are not quite at those levels that, again, we always struggle with what's normal here looking backwards. If you think about that 2016, 2018 sort of time period, typically we would've seen peak a little bit deeper into July. This is a lot closer to that than certainly we've seen over the last three years, not all the way back there. As we base case expectations, we would assume as we get into August here and we start to see the college students vacate and go back to school, and the other typical patterns that we'll have. We see good green lights for August, but don't expect to see any aberration in sort of normal behavior. That's sort of our base case expectation as we get through the fall and into the winter.

[Chris P. Marr, President and CEO at CubeSmart]

I think the cause of the positive trends, again, I go back to the resilience of the business and the fact that we're not reliant upon one particular source of demand. I think it is just this continued awareness of the product, continued awareness of our brand. I think the continued reduction in the impact of new supply, which again, I would place as probably the primary reason for why we're experiencing what we're experiencing.

[Todd Thomas, Analyst at KeyBank]

I wanted to go back to the question around New York City regulation on pricing and licensing requirements. Just curious to get your thoughts whether, does that impact asset pricing or underwriting in any way? Does that sort of change the landscape in New York City at all in your view?

[Chris P. Marr, President and CEO at CubeSmart]

No, I think the thing that it changes in the landscape in New York City is, unfortunately, and we feel bad for the smaller operators, I think the ultimate burden is significantly higher on them. When you think about the types of things that are being discussed, many of them are already ingrained in the day-to-day practices of us and our larger peers. I think it only will make it more attractive for folks to look at Cube and our position and our execution in that market. You can see the metrics that are disclosed.

[Chris P. Marr, President and CEO at CubeSmart]

We are outperforming in the New York MSA, and I think we will continue to do that, and that will make us even more attractive as an option, either as an owner of that asset if that small operator wishes to sell or as the third-party manager if they wish to partner up with them.

[Todd Thomas, Analyst at KeyBank]

Okay. Thank you.

[Operator]

Your next question comes from the line of Nick Joseph with Citi. Your line is open. Please go ahead.

[Nick Joseph, Analyst at Citi]

Thanks. Maybe just following up on that question. It sounds like you're already doing many of the requirements in New York City. Have you had to implement any new practices ahead of it, like allergen testing or anything else to comply?

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. At this point, we have not done anything meaningfully different than we have been doing in New York State or elsewhere in the country. I think we're all sort of navigating through all of this as it's sort of evolving, but have not identified anything yet that would be a material deviation to our normal practices.

[Nick Joseph, Analyst at Citi]

Thanks. You talked about kind of the debt markets earlier. Just curious where you think you could price 10-year debt today if you go down that road.

[Tim M. Martin, CFO at CubeSmart]

Yeah. If we were looking at a 10-year today, it would probably be in the mid-5s, maybe a little higher. A seven-year, call it 50 basis points inside of that. We're actively monitoring the markets. The 10-year obviously has been pushing up a little bit here in recent weeks, and there's an awful lot of volatility in the world. That's the not so great news. The good news is that we have a tremendous amount of flexibility as we have additional capacity on the revolver, and we have nothing maturing in 2027. We have a good bit of time to be patient and opportunistic as we think about long-term strategy from a debt perspective.

[Nick Joseph, Analyst at Citi]

Thank you.

[Tim M. Martin, CFO at CubeSmart]

Thank you.

[Operator]

Your next question comes from the line of Michael Mueller with JPMorgan. Your line is open. Please go ahead.

[Michael Mueller, Analyst at JPMorgan]

Yeah. Thanks. Chris, outside of COVID, when you look back at recoveries over the past 30 plus years or so, what was the largest same-store revenue increase that you remember seeing in a single year?

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. 30 years is a long time. I'm not sure I'm going to get this 100%, but I think if you eliminate the COVID years, something in that 7%-8% kind of quarterly same-store revenue growth was probably the next highest.

[Tim M. Martin, CFO at CubeSmart]

I think that was for a couple of straight years. I think that was like 2012, 2013, 2014.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah

[Tim M. Martin, CFO at CubeSmart]

Coming out of the GFC, and there was no supply.

[Tim M. Martin, CFO at CubeSmart]

That's right.

[Tim M. Martin, CFO at CubeSmart]

The complete lack of supply led to multiple years of seven.

[Chris P. Marr, President and CEO at CubeSmart]

I think it was seven

[Tim M. Martin, CFO at CubeSmart]

7+% type top-line growth.

[Michael Mueller, Analyst at JPMorgan]

Got it. Okay. If you're thinking about a level of improvement from one year to the next, for example, if you're starting at a zero, what was the most you recall seeing in a year? That wasn't a 7% revenue improvement year, was it?

[Chris P. Marr, President and CEO at CubeSmart]

No.

[Chris P. Marr, President and CEO at CubeSmart]

Was it?

[Chris P. Marr, President and CEO at CubeSmart]

I'd have to go back. My memory is not that good. Again, I think even if you think about COVID and how quickly that happened, it's because of the churn, right? There's only so many customers vacating each month, which is, that churn is lower than it was historically. It takes a couple of quarters to get elevated to that level.

[Michael Mueller, Analyst at JPMorgan]

Okay. Thank you.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. Thanks.

[Operator]

Your next question comes from the line of Brendan Lynch with Barclays. Your line is open. Please go ahead.

[Brendan Lynch, Analyst at Barclays]

Thanks for taking my questions. You guys have been kind of talking up the setup for 2027. Certainly, supply can't come back online fast enough to impact next year. Chris, you also mentioned the resiliency of the self-storage demand. We've seen lots of counter-cyclical demand drivers in past challenging macro environments. I guess the question is: What are the risks that could cause a deceleration relative to the outlook that you're kind of presenting here today?

[Chris P. Marr, President and CEO at CubeSmart]

Yeah, great question. Again, I'll keep coming back and pounding the drum that the biggest headwind for storage is and always has been supply. As you noted, we don't see, at this stage of 2026, any material increase in supply or its impact certainly in 2027. At this stage, I would say that risk is low. I think the second risk that has always created a near- term challenge for our industry is any sort of black swan event that causes the consumer to freeze in place. You think about some of the unfortunate events, the onset of COVID, the GFC and related bankruptcies. You can go all the way back to 9/11. Those typically have a short- term impact on move-ins as consumers tend to freeze in place and stop making decisions.

[Chris P. Marr, President and CEO at CubeSmart]

They also then tend to have the corresponding effect where you see vacate volumes decline. It takes a while until the consumer recovers. Those type impacts have typically been weeks, if maybe a month or two months, and then the industry tends to bounce right back.

[Brendan Lynch, Analyst at Barclays]

Great. Thanks. That's helpful. Maybe one for Tim, just on calibrating labor. I think you suggested there's going to be some moderation in the year-over-year comp for personnel. Just walk us through your thoughts on running a little bit leaner on the labor front versus maybe adding a little bit more headcount to maintain the in-person relationships in the facilities themselves.

[Tim M. Martin, CFO at CubeSmart]

Yeah, I think it's always that balance of trying to find the optimal staffing levels to provide the level of customer service that we insist on providing. The changes and the evolution on that line item really date back to things that we did last year. Later in 2025, we saw a little bit of pressure on that line item as we were adding back some store hours and making some adjustments that increased the level from where we had reduced it to. I think what you're going to see here in the back half of the year is just getting up against those comps. The first half of the year saw a more difficult comp for adjustments that we made over time during 2025.

[Tim M. Martin, CFO at CubeSmart]

We feel like we're in a great spot right now from a combination of staffing technology and our approach to attracting new customers and making sure that we're providing great service to our existing customers. Nothing that we're doing today, more stuff that we did about a year ago.

[Brendan Lynch, Analyst at Barclays]

Great. Thank you.

[Tim M. Martin, CFO at CubeSmart]

Thank you.

[Operator]

Your next question comes from the line of Omotayo Okusanya with Deutsche Bank. Your line is open. Please go ahead.

[Omotayo Okusanya, Analyst at Deutsche Bank]

Hi, yes. Good afternoon, everyone. Quick question just the Sun Belt markets and some of your earlier comments. Can you just kind of talk us through how you're thinking about recovery in quite a few of those markets? Again, you did mention that, oversupply in places like Fort Myers really could be a multi-year problem. As you just kind of think through those markets and you kind of think about potential inflection, how should we be thinking about that, whether it's a year away, two years away, or just whatever your crystal ball is telling you? Some insight would be appreciated.

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. I think as everyone knows, this is a micro market business. Even within Sun Belt markets, we see pockets that are improving more rapidly than others, likely and largely due to, again, that impact of the new construction, the new supply that has been brought on board, adjacent to those same stores in those markets. I think it's improving. If you look at the sequential results, as we mentioned, you're seeing the same store revenues going in a good direction. I think it will be unique to each individual market. Let's use Miami as an example. There you had an awful lot of supply, but an attractive and continues to be an attractive place both for individuals and businesses to work and live.

[Chris P. Marr, President and CEO at CubeSmart]

I think we saw that supply get absorbed fairly expediently, and you've seen results in Miami move a little bit quicker towards and into positive growth territory. I think the major Texas markets and the Southwest, it will be a bit slower and gradual. How to predict which quarter or which date things flip positive, that's really difficult to say. I do think we'll just kind of see this continued gradual recovery throughout the balance of 2026.

[Omotayo Okusanya, Analyst at Deutsche Bank]

Thank you.

[Operator]

Your next question comes from the line of Juan Sanabria with BMO Capital Markets. Your line is open. Please go ahead.

[Juan Sanabria, Analyst at BMO Capital Markets]

Your sotry is so sexy, I had to come in twice. Just hoping to following up on the JV and investments discussion. For CBRE and Heitman, is the thought that going forward those two ventures would acquire in the open market going forward to grow? I think, Tim, you said something about a thawing or something in your prepared remarks. I'm just curious if you could elaborate on that.

[Tim M. Martin, CFO at CubeSmart]

Yeah. I think the most likely avenue for growth in each of those ventures would be open market opportunities, perhaps things that we manage currently that we can find a home for. Each of those ventures and each of those partners have areas of focus that range from the type of opportunity as far as return profile, early stage lease up, stabilized, looking at different markets. The great thing for our investments team, having each of those partners gives us the ability to pursue a pretty wide range of opportunities, and that's pretty exciting. What was the second part of your question?

[Juan Sanabria, Analyst at BMO Capital Markets]

You mentioned, I think, some thawing in the acquisition market, maybe more product coming to market. I'm just kind of hoping you'd elaborate.

[Tim M. Martin, CFO at CubeSmart]

Yeah. It hasn't thawed all that much for us, but I think you're starting to see some momentum in a lot more things that I think the brokerage community is pretty excited about the things that are starting to come across their plates. I think there continues to be an evolution that the market is what the market is. I think sellers understand where buyers are and vice versa, it feels like it's getting a little bit more constructive. The thing that hasn't changed is that it certainly feels like there's a wave of opportunity that is coming, we've talked about that in prior quarters. I just think you have an awful lot of self-storage assets that are held by folks who want liquidity, some who are going to need liquidity. You have things in closed-end funds that ultimately have to close.

[Tim M. Martin, CFO at CubeSmart]

You've had a fairly modest amount of transactions here now for two years running. Certainly feel like the dam is going to break, when it does, there's going to be an awful lot of opportunity. From a CubeSmart perspective, we want to make sure that we're in the best position we can be in to take advantage of that's what we're preparing to do.

[Juan Sanabria, Analyst at BMO Capital Markets]

Thanks. Lastly, sorry to be greedy here. On the labor front and the wages, just curious on where you think we are in the optimization of FTEs or what have you, are we at a max in terms of efficiency gains? What you think the future may hold?

[Chris P. Marr, President and CEO at CubeSmart]

Yeah. Thanks, Juan. I think that's an area that is likely subject to continued evolution. I think on the service delivery front, especially in our more dense urban markets, you continue to see the value of having our teammates in the stores, keeping them clean, and providing great customer service. I think as we continue to evolve in our utilization of AI, looking for ways where that can enhance customer service, many of those will be hand-in-hand with our teammates delivering. Would expect that that will likely translate into revenue gains on the efficiency side more than necessarily focused on the cost side of things. At the markets that the technology and the opportunities to serve, also our customers' preferences continue to evolve, we would expect those trends to be continuing as I described.

[Juan Sanabria, Analyst at BMO Capital Markets]

Thank you.

[Operator]

We have reached the end of the Q and A session. I will now turn the call back to Chris Marr for closing remarks.

[Chris P. Marr, President and CEO at CubeSmart]

All right. Thanks everybody for participating today. We apologize for the technical difficulties. I'm told that we can blame Michael Goldsmith if we need to. As we look forward here, we are excited about the return to growth. Return to growth in cash flows, return to growth in earnings, returning to growing our assets under management, whether that be through our excellent third-party management platform, acquiring stores with our partners or on balance sheet. We will continue to execute on that growth in a very disciplined way, laser-focused on creating shareholder value. Thank you all. Look forward to seeing you in the future and talking to you again next quarter.

[Operator]

This concludes today's call. Thank you for attending. You may now disconnect.

Participants

Executives

• Josh Schutzer, SVP of Finance
• Chris P. Marr, President and CEO
• Tim M. Martin, CFO
• Spenser Glimcher, Analyst

Analysts

• Michael Griffin, Analyst at Evercore ISI
• Michael Goldsmith, Analyst at UBS
• Ravi Vaidya, Analyst at Mizuho
• Juan Sanabria, Analyst at BMO Capital Markets
• Viktor Fediv, Analyst at Scotiabank
• Todd Thomas, Analyst at KeyBank
• Nick Joseph, Analyst at Citi
• Michael Mueller, Analyst at JPMorgan
• Brendan Lynch, Analyst at Barclays
• Omotayo Okusanya, Analyst at Deutsche Bank