Public Storage 2000 Annual Report Download - page 47

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P
UBLIC S TORAGE , I NC . 2000 A NNUAL R EPORT
Acquisition and development of facilities: During 2000, we have acquired two commercial facilities and 12 storage facilities at an
aggregate cost of approximately $67.1 million. In addition, on September 15, 2000, we acquired the remaining ownership interests in
a partnership, of which we were the general partner, for an aggregate acquisition cost of $81.2 million. This partnership owned
13 self-storage facilities.
As previously announced, in April 1997, we formed a joint venture partnership with an institutional investor for the purpose of
developing up to $220.0 million of self-storage facilities. The joint venture is funded solely with equity capital consisting of 30% from
us and 70% from the institutional investor. Our share of the cost of the real estate in the joint venture is approximately $69 million at
December 31, 2000. As of December 31, 2000, the joint venture had 47 operating facilities, with 2,878,000 net rentable square feet
and total development costs of approximately $231.5 million.
In November 1999, we formed a second joint venture partnership for the development of approximately $100 million of self-
storage facilities. The venture is funded solely with equity capital consisting of 51% from us and 49% from the joint venture partner.
The term of the joint venture is 15 years. After six years, the joint venture partner has the right to cause the company to purchase
the joint venture partner’s interest for an amount necessary to provide them with a maximum return of 10.75% or less in certain
circumstances. At December 31, 2000, this development joint venture was committed to develop 17 facilities (approximately
1,229,000 net rentable sq. ft.) with an estimated development cost of approximately $36.9 million, of which 11 facilities
(approximately 714,000 net rentable sq. ft.) were completed at an aggregate cost of approximately $50.8 million. As of December 31,
2000, the second development joint venture is developing six additional projects (approximately 515,000 net rentable square feet)
that were in process, with total costs incurred of $23.8 million and estimated remaining costs to complete of $13.1 million. We have
submitted 5 additional facilities for approval with total estimated costs of approximately $22.4 million; we have incurred
approximately $8.5 million through December 31, 2000 with respect to these 5 projects. Upon approval, these projects will be
transferred to the joint venture and the joint venture partner will contribute its 49% share.
We currently have a development “pipeline” of 110 self storage facilities, combination facilities, and expansions to existing self
storage facilities with an aggregate estimated cost of approximately $628.2 million. Approximately $238.6 million of development cost
is incurred as of December 31, 2000. We have acquired the land for 78 of these projects, which have an aggregate estimated cost of
approximately $425.9 million, and costs incurred as of December 31, 2000 of approximately $234.3 million. The remaining 32
facilities represent identified sites where we have an agreement in place to acquire the land generally within one year.
The development and fill-up of these storage facilities is subject to significant contingencies. We estimate that the amount remaining
to be spent of approximately $373.9 million will be incurred over the next 24-28 months. The following table sets forth our
development pipeline and a range of estimated opening dates for these projects:
Number Total Estimated Total Cost Incurred Estimated Time
of Cost of through December Frames of Facility
Facilities Development 31, 2000 Openings
Development – Land Acquired at 12/31/00
Self-storage facilities 31 $183,459 $115,483 Q1 ‘01 – Q1 ‘02
Expansions of existing self-storage facilities 25 73,337 39,243 Q1 ‘01 – Q1 ‘02
Combination facilities 22 169,103 79,607 Q1 ‘01 – Q1 ‘02
Total 78 425,899 234,333
Potential Development – Land to be Acquired After 12/31/00
Self-storage facilities – development starts estimated by 6/30/01 16 106,299 2,532 Q2 ‘02 – Q3 ‘02
Self-storage facilities – development starts estimated after 6/30/01 5 40,863 542 After Q3 ‘02
Expansions of existing self-storage facilities 7 12,421 388 Q1 ‘02 – Q3 ‘02
Combination facilities 4 27,046 792 Q1 ‘02 – Q3 ‘02
Total 32 186,629 4,254
Totals 110 $612,528 $238,587