Solid Second Quarter Performance: Extra Space Storage reported a same-store occupancy rate of 94.6%, an increase of 60 basis points year-over-year and 120 basis points sequentially from Q1. However, same-store revenue growth remained flat for the quarter, largely due to gradual improvements in new customer rates after extended periods of pricing sensitivity.

Positive Rate Trends, But Gradual Improvement: The company noted an encouraging turnaround with positive year-over-year rate growth for new customers for the first time since March 2022, with rates up over 2% in July. The expected improvement in same-store revenue is projected to occur gradually, with a potential acceleration in the second half of the year, particularly in Q4.

Expense Growth and Challenges: Same-store expenses rose by 8.6% year-over-year, mainly due to significant increases in property taxes, particularly in states with legacy Life Storage properties. The company anticipates expense growth to normalize in the latter half of the year, bringing overall cost increases into a range of 4-5%.