Public Storage 2009 Annual Report Download - page 25

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programs, pricing of our product, as well as the development and documentation of standardized operating
procedures. We also believe that our major market concentration provides managerial efficiencies stemming from
having a large number of facilities in close proximity to each other.
We can economically purchase large, prominent, well-placed yellow page ads that allow us to reach the
consumer more effectively than smaller operators. We are also able to purchase and bid aggressively for multiple-
keyword advertising on national Internet search engines. In addition, we are able to market efficiently using
television as a media source. The concentration of most of our properties in major metropolitan centers makes
various promotional and media programs, such as television, yellow pages, and Internet keyword bidding, far more
economical for us than for our competitors.
Brand name recognition: Our operations in the U.S. are conducted under the “Public Storage” brand
name, which we believe is the most recognized and established name in the self-storage industry in the U.S. Our
storage operations within the U.S. are conducted in major markets in 38 states, giving us national recognition and
prominence. Our facilities tend to be highly visible and located in heavily populated areas, improving the local
awareness of our brand. We believe that the “Shurgard” brand, used by Shurgard Europe, is a similarly established
and valuable brand.
Complementary ancillary operations: Through a taxable REIT subsidiary, we sell retail items associated
with the storage business and reinsure policies issued to our tenants against lost or damaged goods stored by tenants
in our storage facilities. We believe these activities supplement and strengthen our existing self-storage business by
further meeting the needs of storage customers.
Growth and Investment Strategies
As described more specifically in “The Impact of Current Economic Factors” above, our growth
strategies have been revised in the short-run to respond to current market conditions.
Over the long-run, our growth strategies have consisted of: (i) improving the operating performance of our
existing self-storage properties, (ii) acquiring properties that are owned or operated by others in the U.S., (iii)
developing or redeveloping existing U.S. real estate facilities, (iv) participating in the growth of commercial
facilities owned primarily by PSB, and (v) capitalizing on the growth of facilities owned by Shurgard Europe in the
European market. In addition to certain revisions to these strategies described below, our strategy has been revised
in the short-run to take advantage of dislocation in current capital markets.
Improve the operating performance of existing properties: Demand for our self-storage facilities has been
negatively impacted over the past two years by the current recessionary trends, and revenue and net operating
income have both declined in 2009. Over the long-run we seek to increase the net cash flow generated by our
existing self-storage properties by a) regularly evaluating our call volume, reservation activity, and move-in/move-
out rates for each of our properties relative to our marketing activities, b) evaluating market supply and demand
factors and, based upon these analyses, adjusting our marketing activities and rental rates, c) attempting to maximize
revenues through evaluating the appropriate balance between occupancy, rental rates, and promotional discounting
and d) controlling expense levels. We believe that our property management personnel and systems, combined with
our national telephone reservation system and media advertising programs will continue to enhance our ability to
meet these goals. See Item 7. “Management’s Discussion and Analysis” below for further information regarding our
expectation in the short-run with respect to our operating results.
Acquire properties owned or operated by others in the U.S.: Our long-run strategy has included acquiring
well-located facilities owned or operated by others in the U.S. that fit well within our geographic profile, at
generally attractive pricing. We believe our presence in and knowledge of substantially all of the major markets in
the U.S. enhances our ability to identify attractive acquisition opportunities and capitalize on the overall
fragmentation in the self-storage industry. Data on the rental rates and occupancy levels of our existing facilities,
which are often located in proximity to potential acquisition candidates, provide us an advantage in evaluating the
potential of acquisition opportunities. In the short-run, we believe that there may be more attractive opportunities
for the acquisition of facilities from distressed sellers who, due to the constrained credit environment and pressure