Public Storage 2010 Annual Report Download - page 60

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(f) Late charges and administrative fees are excluded from the computation of realized annual rent per occupied square
foot and REVPAF. Exclusion of these amounts provides a better measure of our ongoing level of revenue, by
excluding the volatility of late charges, which are dependent principally upon the level of tenant delinquency, and
administrative fees, which are dependent principally upon the absolute level of move-ins for a period.
(g) 5HDOL]HGDQQXDOUHQWSHUDYDLODEOHIRRWRU³5(93$)´LVFRPSXWHGE\GLYLGLQJUHQWDOLQFRPHEHIRUHODWHFKDUJHVDQG
administrative fees by the total available net rentable square feet for the period.
(h) In place annual rent per occupied square foot represents annualized contractual rents per occupied square foot without
reductions for promotional discounts and excludes late charges and administrative fees.
6KXUJDUG (XURSH¶V RSHUDWLRQV have been impacted by the same trends in self-storage demand that our
domestic facilities faced. Year-over-year revenue growth improved from a 3.5% reduction in 2009, to a 1.7%
increase in 2010. At December 31, 2010, in place rental rates were 3.9% higher and average square foot occupancy
was down 0.9%, as compared to December 31, 2009. The operating results of the Europe Same Store Facilities are
more volatile than the operating results of the Same Store Facilities, because of the relatively smaller size of the
Europe Same Store Facilities.
Net operating income increased 2.7% in the year ended December 31, 2010 as compared to the same period
in 2009. The increase in the year ended December 31, 2010 as compared to the same period in 2009 is due to a
1.7% increase in revenues, partially offset by a 0.3% increase in cost of operations. The revenue increase in the year
ended December 31, 2010 as compared to the same period in 2009 was primarily caused by higher rental income as
a result of an increase in average realized annual rental rates per occupied square foot partially offset by a decrease
in average occupancy levels.
Shurgard Europe, similar to our Domestic Self-Storage segment, has a nominal development pipeline.
Accordingly, at least in the short-term, we do not expect any significant impact to our earnings from Shurgard
(XURSH¶V GHYHORSPHQW DFWLYLWLHV, other than the continued fill-XS RI 6KXUJDUG (XURSH¶V H[LVWLQJ XQVWDELOL]HG
facilities.
In Note 5 to our December 31, 2010 consolidated financial statemenWV ZH GLVFORVH 6KXUJDUG (XURSH¶V
consolidated operating results for the years ended December 31, 2010, 2009 and 2008  6KXUJDUG (XURSH¶V
consolidated operating results include additional facilities that are not Europe Same Store Facilities, and are based
upon historical exchange rates rather than constant exchange rates for each of the respective periods.
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Other Investments: 7KH ³Other ,QYHVWPHQWV´ DW 'HFHPEHU  10 are comprised primarily of our
equity in earnings from various limited partnerships that collectively own 19 self-storage facilities. The reduction
for 2009 as compared to 2008 is due to our commencing consolidation of three facilities that we acquired, which
were previously owned by entities that we accounted for on the equity method of accounting. Our future earnings
with respect to the Other Investments will be dependent upon the operating results of the facilities that these entities
own. See Note 5 to our December 31, 2010 consolidated financial statements for the operating results of these 19
facilities XQGHUWKH³2WKHU,QYHVWPHQWV´
Ancillary Operations
Ancillary revenues and expenses include amounts associated with (i) the reinsurance of policies against
losses to goods stored by tenants in our self-storage facilities in the U.S., (ii) merchandise sales in the U.S., (iii)
commercial property operations, (iv) merchandise sales and tenant reinsurance operations conducted by Shurgard
Europe to the extent consolidated in our financial statements, and (v) management of facilities for third parties and
facilities owned by the Unconsolidated Entities. Revenues and expenses of discontinued ancillary operations,
including our truck rental and containerized businesses, are included in discontinued operations on our consolidated
statements of income.