Acquisition, Higher Rents Hike Public Storage Earnings

Public Storage Inc., Glendale, the largest owner of self-storage properties in the United States, said third-quarter earnings rose 23%, boosted by higher rents and a large acquisition.

Public Storage’s funds from operations increased to $76.8 million, or 70 cents a share, up from $62.3 million, or 60 cents, a year earlier. Per-share results reflect preferred dividend payments. Revenue rose to $179 million from $149.7 million.

The results exceeded Wall Street’s expectations of 69 cents, according to a survey of analysts by First Call Corp.

Public Storage owns or has a stake in 1,354 self-storage properties in 37 states, up 24% from a year ago. Much of the gain stems from the March purchase of rival Storage Realty Trust for about $600 million.

Its holdings, worth about $4.2 billion on a book value basis, are triple the size of its nearest competitor, Amerco, parent of U-Haul International Inc.

Public Storage said average annual rents rose 4.5% to $10.51 per square foot, down from a 9.1% gain a year ago.

The occupancy rate at properties owned for at least a year stood at 93.4% at the end of September, compared with 93.7% a year earlier.

The company’s new pickup and delivery service, which delivers storage crates to and from customers’ homes, broke even, the first time that the unit hasn’t lost money.