Investor Presentation May 2 2015 015 The forward-looking - - PowerPoint PPT Presentation

Investor Presentation

May 2 2015 015

2

The forward-looking statements contained in this presentation are subject to various risks and

• uncertainties. Although the Company believes the expectations reflected in such forward-

looking statements are based on reasonable assumptions, there can be no assurance that its expectations will be achieved. You should not rely on our forward-looking statements because the matters they describe are subject to known and unknown risks and uncertainties that could cause the Company’s future results, performance, or achievements to differ significantly from the results, performance, or achievements expressed or implied by such

• statements. Such risks are set forth under the captions “Item 1A. Risk Factors” and “Forward-

Looking Statements” in our annual report on Form 10-K and under the caption “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” (or similar captions) in our quarterly reports on Form 10-Q, and described from time to time in the Company’s filings with the SEC. Forward-looking statements are not guarantees of

• performance. For forward-looking statements herein, the Company claims the protection of

the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement forward- looking statements that become untrue because of subsequent events.

Se Self-storage R REIT with e expan ansiv ive natio ional p al plat atform

3

428 609 181

Facilities1 Owned Managed

Miami 19 Other FL 54 Atlanta 16 Major TX 48 Chicago 37 Ohio 20 Balt/DC 23 Philadelphia 15 NY 49 CT 21 Boston 5 Tenn 6 AZ/LV 32 CO/UT 13

• So. CA

12 Inland Empire 16 Other West 15 Other Midwest 10 Other Southeast 6 Other Northeast 11

1) Property count as of March 31, 2015. 2) Market value of common and book value of preferred equity and debt as of March 31, 2015.

Malvern, PA

Headquarters

$5.3 billion

Total Market Cap2

Owned Portfolio by Market

4

Inno nnovative p e platforms, d discipline ned growth, a and nd prud uden ent fund funding ng h have e com

• mbined t

to g

• genera

rate si significant v value f for sha

• r shareholders

rs

Cumulative Total Returns1

1) Returns through March 31, 2015. Self-Storage REITs represent a straight average of cumulative total returns for the four largest publicly traded storage REITs.

5

External al Grow Growth Finan ancia ial l Streng ength Internal al Grow Growth

Maximize p e portfo folio v value e through c conti tinued f focu cus s

• n customer

er s service a e and oper erat ational al a advancem emen ent Continue nue to to prudentl tly y build ild a portfolio io o

• f h

hig igh- qu qual ality as asset ets, w with a a fo focus o

• n tar

argeted mar arket ets Finance g growth b by y acce ccess ssing th the f full a array of ca capi pital sources a availa ilable le t through a h a BBB/B /Baa2 aa2 i inves estmen ent g grad ade bal alance s sheet eet

6

External al Grow Growth Finan ancia ial l Streng ength Internal al Grow Growth

Maximize p e portfo folio v value e through c conti tinued f focu cus s

• n customer

er s service a e and oper erat ational al a advancem emen ent Continue nue to to prudentl tly y build ild a a portfolio io of high gh-quality a ty assets ts, w with a a fo focus o

• n tar

arget eted mar arket ets Mainta tain BBB/B /Baa2 aa2 i inves estment g grad ade b e balan ance sheet et that at affo affords broad ac acces ess t to t the fu full ar array o

• f c

f cap apital source ces Re Reve venue Expe xpense ses NOI NOI2 Aver erag age O e Occupan ancy

+7.0 +7.0% +2.0 +2.0% +9.5 +9.5% 90.7 90.7% (+180 b

+180 bps YO YOY) Y)

2015 2015 First Qu t Quarter S Same-Store R e Res esul ults1



Revenue growth driven increasingly by effective rent growth



Expense growth is expected to remain inflationary, except for continued pressure on real estate taxes

Rev evenue enue Expens enses es NOI OI2

+5.25% t 25% to +6.25% 25% +3. +3.0% to to +3. 3.75% 75% +6.25% t 25% to +7.25% 25%

2015 S 2015 Same-Store G e Gui uidanc nce3

1) Financial data from January 1, 2015 through March 31, 2015 2) Net operating income, or revenues less property operating expenses. Please refer to CubeSmart’s public filings for a detailed explanation of NOI and how it reconciles to a GAAP measure. 3) As provided in the Company’s Earnings Release dated April 30, 2015

Reser ervation

• n

Attract ction

• n

Rental al Continue nued Engagement nt

7 Internet Marketing

Revenue Management

Customer Service

Marketing Efforts Website Email Confirmation Customer Center Inventory Management Attractive Discount Attractive Offer In-Place Rate Increases Customer Referrals Sales Center Store Managers

• PREMIUM UNIT
• NORMAL UNIT
• ECONOMY UNIT

Enh nhanc ncing ng t the e cus ustomer er ex exper erienc nce e at a all points o

• f eng

f engagem emen ent thr hrough p prop roprietary sy syst stems a s and proc process sses

Social Media

7

8

Adjus usting ng t to ev evolving ng marketing ng ec ecosys ystem ems and nd eng engagem emen ent m med ediums

Time Sophisti stica cati tion

Yellow Page advertising; engagement primarily via land-line phone and in-person Early online advertising; websites accessed via desktop computers and serve as digital flyers Website maturation; Internet ad spend predominant marketing budget item; mobile an increasingly important traffic driver Growing complexity of digital marketing platforms (i.e. social media, customer reviews, and search engine algorithms); Customers engage through a multitude of devices; personalized customer experiences

9

Optimizing ng m marketing ng effo efforts and nd effi efficien ently attracting ng cus ustomer ers throug ugh us use o e of i f ind ndus ustry-le lead adin ing a analy alytics

10

Suppleme menti ting i g inte ternet m t marketi ting initi tiati tive ves with a a t traditi tional p platform to take a e advantage o e of f market d dep epth a and nd to

• rea

each c cus ustomers offl ffline



Out-of-home placements in markets with high store concentration



Hyper-targeted direct mail campaigns in select markets



Selective local marketing efforts to target specific customer segments

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Advanced data a ana nalytics t to

• per

ersonalize ex e exper erienc nces es fo for ea each c cus ustomer

Custom Experience 1 Custom Experience 2 Custom Experience 3



Continued focus on capturing and leveraging insights about customers to create customized experiences that increase engagement and conversion



Understanding the motivations of different customers and engaging with them through methods they trust



Historically, advanced revenue management techniques have boosted revenue in a number of supply-constrained industries, beginning with airlines and then moving on to hotels



Multi-family represents the closest analogy, but the unpredictable lengths

• f stay for self storage customers adds additional complexity

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Rev evenue enue Mana nagem ement L Land ndscape

Fund undamental Pricing ng I Issue ue

Optimal Pricing

• Substitutability
• Competition
• Timing / Other
• Capacity / Economic

Outcomes

Pricing Decisions Pricing optimization requires consideration of a multi-dimensional demand landscape and dynamic capacity constraints

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Long ng-Term Rev evenue enue Maximization S n Strateg egy

Demand and F Forecast/ / Revenue nue Optim imization ion

Price optimization requires consideration of a multi-dimensional demand landscape & dynamic capacity constraints

Balance B ce Between een Street eet R Rates es, Di Discounts, a , and nd Conces cession

• ns

Goal of providing the most compelling offer to the customer that maximizes long-term revenue

In In-Pl Place R ce Rate I e Incr crea eases es

Dynamic in-place rate increase strategies take advantage of customer stickiness to maximize long-term revenue

Unit it Mix D Decis isio ions & I & Inve nventory Management nt

Maximizing revenue through dynamic inventory management, prioritization, & unit conversions to create

• ptimal unit availability

14

Striv ivin ing to f fulfil ill o l our m missio ion o

• f s

simplif lifyin ing o

• rgan

aniz izatio ional al chall llenges throug ugh unp unparallel eled c cus ustomer ser ervice



Focus on customer service throughout all touch-points (store, sales center, and website) to create a fully integrated interaction with each customer



Modern offices and operational training focused on service-oriented values facilitate an efficient rental process

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An An a awa ward-win innin ing ser ervice c cul ultur ure

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External al Grow Growth Finan ancia ial l Streng ength Internal al Grow Growth

Maximize p e portfo folio v value e through c conti tinued f focu cus s

• n customer

er s service a e and oper erat ational al a advancem emen ent Continue nue to to prudentl tly y build ild a a portfolio io of high gh-quality a ty assets ts, w with a a fo focus o

• n tar

arget eted mar arket ets Mainta tain BBB/B /Baa2 aa2 i inves estment g grad ade b e balan ance sheet et that at affo affords broad ac acces ess t to t the fu full ar array o

• f c

f cap apital source ces

In Inve vestme ment S t Strategy gy



$49.3 m milli illion in year-to-date acquisitions1



$200 $200.8 m 8 million of investments under contract



$85.2 million of acquisitions at completion, $115.6 million

• f JV development



13 13 new properties added to the third-party platform,



Acquired 6 6 properties from managed portfolio in 1Q15



Focus on high-quality properties in high-barrier-to- entry markets



Leverage relationships with development partners to invest selectively in accretive development and built- to-suit opportunities



Utilize third-party management program to gain additional scale and efficiencies and create potential acquisition opportunities with private owners

Exe Execu cution

1) Acquisitions closed and under contract as of 3/31/2015.

Acquis isit itio ions1,2

,2

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Fo Focu cus o

• n adding s

g sca cale i in attractive, high gh-barri rrier-to to-ent entry m y market ets

Investment Act Activity S Since 2008 2008

$2.0 billion

192 Stores

1) Transactions closed from 2008 through March 31, 2015 2) Includes investment in 35 properties through HHF Joint Venture

Disp isposit sitio ions1

$422 million

139 Stores

Acquisitions, 2008 – March 2015 Dispositions, 2008 – March 2015 Development Properties, 2014 – March 2015

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Signi nificant ev evolution n over er past s sev even en yea years

Note: Bubbles sized by revenue. 1) Realized annual rent per occupied sq ft is computed by dividing rental income by the weighted occupied sq ft for the period. 2) Includes transactions closed or announced and under contract as of March 31, 2015.

Tot Total P Por

• rtfol
• lio

March 201 2015

Acquis isit itio ions ns

2008 08 – March 201 2015

Dispositio ions ns, 2008

2008 – March 2015 2015

1

2 2 2

Total P l Portfolio lio

Janua nuary 2 2008

1Q 1Q14 14 Bronx, NY – $17.2M Malvern, PA - $25.1M 2Q15 15 Arlington, VA - $18.1M

$157.9M

20 2Q16 16 Bronx, NY - $32.0M

Dev evel elopmen ent



Development transactions generate highest returns



Utilize partners for local market expertise

1Q 1Q16 16 Queens, NY - $32.1M Queens, NY - $19.0M

1) Dollar amounts represent 100% of estimated CubeSmart investment. 2) These facilities are expected to be purchased upon completion and are subject to due diligence and other customary closing

• conditions. No assurance can be provided that these acquisitions will be completed on the terms described, or at all.

Arlin lington

• n, V

VA

4Q 4Q15 15 Brooklyn, NY

• $14.4M

$123.2M

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Purchase e at C Complet etion

• n



These transactions allow us to acquire high-quality, purpose-built assets without taking

• n development risk



Our proven operational platform creates value by mitigating lease-up risk

4Q14 14 Long Island City, NY – $38M 2Q 2Q15 15 Dallas, TX – $15.8M 1Q16 16 Brooklyn, NY – $48.5M Grapevine, TX - $10.8M 4Q15 15 Fort Worth, TX - $10.1M

1) These facilities are expected to be purchased upon completion and are subject to due diligence and other customary closing

• conditions. No assurance can be provided that these acquisitions will be completed on the terms described, or at all.

Dalla llas, TX

Enh nhanc ncing ng o

• ur

ur p portfolio b by y adding ng pur urpose-built ilt Clas ass A A facili ilities

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

Platform has grown to 181 181 properties since its inception in 2009



Purchased 57 57 properties from our managed portfolio for $527 m $527 million1 since 2010

1) Includes acquisitions closed or under contract as of March 31, 2015.

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Thi Third-party management nt a allows us us to l lev ever erage o e our ur oper erating ng p platform a and nd gener enerate e additional ec econo nomies es o

• f s

f scale

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External al Grow Growth Finan ancia ial l Streng ength Internal al Grow Growth

Maximize p e portfo folio v value e through c conti tinued f focu cus s

• n customer

er s service a e and oper erat ational al a advancem emen ent Continue nue to to prudentl tly y build ild a a portfolio io of high gh-quality a ty assets ts, w with a a fo focus o

• n tar

arget eted mar arket ets Mainta tain BBB/B /Baa2 aa2 i inves estment g grad ade b e balan ance sheet et that at affo affords broad ac acces ess t to t the fu full ar array o

• f c

f cap apital source ces

Appr proach



Fund external growth in a manner consistent with our

• bjective of maintaining our investment grade credit

rating



Conservative balance sheet strategy provides capacity and flexibility to close transactions and the ability to access multiple sources of capital

2015 A 2015 Activi vity



Raised $29. $29.4 mill llio ion in equity offering proceeds through at-the-market equity program



Amended credit agreement to increase revolving line

• f credit to $500

milli illion from $300 million



Extended maturity to April 2020 from June 2017

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Objec ective o e of f fund funding ng g growth in n manner ner cons nsistent with a a cons nser ervative e balanc nce s e shee eet

Investm tment G Grade de R Rating

As of March 31, 2015

Conse servati tive M Metrics cs

35% Debt / Gross Assets 38% Debt + Preferred / Gross Assets 5.0x Debt / EBITDA1 5.4x Debt + Preferred / EBITDA1 5.9% Secured Debt / Gross Assets

As of March 31, 2015

BBB

(St (Stable)

Baa2

(St (Stable)

Well ll-Sta taggered D d Debt M Matu turity Sch chedu dule

As of March 31, 20152

Weig eighted Avera rage Maturi rity

5.6 Yea ears rs

(in thousands)

1) Based on EBITDA and average debt outstanding during 1Q15 2) Maturity pro-forma to include new maturity for line of credit

Strong ng oper erating p per erfo formanc nce c coup upled ed with c cons nser ervative b balanc nce e sheet eet m managem ement cont ntinues ues to improve c e cred edit m met etrics

Historical Leverage Levels1 EBITDA Coverage Ratio1 Gross Assets1 Dividends2

1) Source: Company Filings 2) Sources: SNL, Company Filings 3) Dividend payout ratio calculated as annual common distributions declared per share / funds from operations per share, as adjusted

3

26

3



Rob

• bust

st org

• rganic grow

rowth fueled by a focus on customer service, continued enhancement of operational infrastructure, and a widening divide between large and small operators



Meani ningful ful e externa nal g growth through a disciplined investment process supplemented by a competitive and expanding third party management platform



Strategic growth objectives are suppor

• rted

ed b by a healthy, y, i investment ent grade balanc nce s e sheet eet and access to a broad array of capital sources

27

Same-Store re P Perf rform rmance 1 2010 2011 2012 2013 2014

Revenue Growth 0.3% 3.6% 3.8% 7.4% 7.2% NOI Growth 1.0% 5.7% 6.0% 9.3% 9.6% YOY Occupancy Growth (BPS) 0.6% 2.0% 3.4% 5.3% 2.6% Annual Avg. Occupancy 76.8% 78.8% 82.6% 88.4% 90.8%

Extern rnal G Gro rowth

# Acquired Properties 12 27 37 20 53 Acquisition Value ($MM) $85.1 $467.1 $432.3 $189.8 $568.2 # of Disposed Properties 16 19 26 35 Disposition Value ($MM) $38.1 $45.2 $60.0 $126.4 $0.0

Tradin ing & & V Valu luatio ion M Metric ics

Market Equity Value2 $965 $1,277 $2,049 $2,335 $3,752 Total Market Capitalization2 $1,580 $2,035 $3,073 $3,474 $4,926 Total Gross Assets2 $1,793 $2,195 $2,504 $2,757 $3,278 P / FFO (Trailing)3 18.7x 16.4x 19.7x 17.5x 20.4x FFO Payout Ratio4 28.4% 44.6% 47.3% 50.5% 50.9% Dividend Yield5 1.5% 2.7% 2.4% 2.9% 2.5%

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1) Performance as reported for the same-store pool as it was constituted at the end of the respective year 2) Year-ending values as detailed in Company’s supplemental packages 3) Calculated as ending common share price / funds from operations per share, as adjusted. Please refer to CubeSmart’s public filings for a detailed explanation of FFO and how it reconciles to a GAAP measure. 4) Calculated as annual common distributions declared per share / funds from operations per share, as adjusted 5) Calculated as annual dividend per share / ending common share price

Date

Invest estor R r Rela elatio ions C s Contact

Charles Place Director, Investor Relations 5 Old Lancaster Rd. Malvern, PA 19355 610.535.5700 cplace@cubesmart.com

Date

Investor tor R Relati tion

• ns C

Conta tact

Charles Place Director, Investor Relations 5 Old Lancaster Rd. Malvern, PA 19355 610.535.5700 cplace@cubesmart.com