Public Storage 2014 Annual Report Download - page 33

19
(a) See Schedule III: Real Estate and Accumulated Depreciation in the Company’s 2014 financials, for a complete
list of properties consolidated by the Company.
(b) The facilities located in Europe include one facility in the United Kingdom that we wholly own, as well as the
facilities owned by Shurgard Europe.
We seek to maximize our facilities’ cash flow through the regular review and adjustment of rents
charged and promotions granted to our existing and new incoming customers, and controlling expenses.
For the year ended December 31, 2014, the weighted average occupancy level and the average realized rent
per occupied square foot for our self-storage facilities were approximately 93.0% and $14.81, respectively,
in the U.S. and 85.0% and $25.92, respectively, in Europe.
At December 31, 2014, 34 of our U.S. facilities with a net book value of $161 million were
encumbered by an aggregate of $64 million in secured notes payable.
We have no specific policy as to the maximum size of any one particular self-storage facility.
However, none of our facilities involves, or is expected to involve, 1% or more of our total assets, gross
revenues or net income.
Description of Self-Storage Facilities: Self-storage facilities, which comprise the majority of our
investments, offer accessible storage space for personal and business use at a relatively low cost. A user
rents a fully enclosed space, securing the space with their lock, which is for the user's exclusive use and to
which only the user has access. On-site operation is the responsibility of property managers who are
supervised by district managers. Some self-storage facilities also include rentable uncovered parking areas
for vehicle storage. Space is rented on a month-to-month basis and rental rates vary according to the
location of the property, the size of the storage space and other characteristics that affect the relative
attractiveness of each particular space, such as whether the space has “drive-up” access, its proximity to
elevators, or if the space is climate controlled. All of our self-storage facilities in the U.S. are operated
under the "Public Storage" brand name, while our facilities in Europe are operated under the “Shurgard”
brand name.
Users include individuals from virtually all demographic groups, as well as businesses.
Individuals usually store furniture, household appliances, personal belongings, motor vehicles, boats,
campers, motorcycles and other household goods. Businesses normally store excess inventory, business
records, seasonal goods, equipment and fixtures.
Our self-storage facilities generally consist of between 350 to 750 storage spaces. Most spaces
have between 25 and 400 square feet and an interior height of approximately eight to 12 feet.
We experience minor seasonal fluctuations in the occupancy levels of self-storage facilities with
occupancies generally higher in the summer months than in the winter months. We believe that these
fluctuations result in part from increased demand from moving activity during the summer months and
incremental demand from college students.
Our self-storage facilities are geographically diversified and are located primarily in or near major
metropolitan markets in 38 states in the U.S. Generally our self-storage facilities are located in heavily
populated areas and close to concentrations of apartment complexes, single family residences and
commercial developments.
Competition from other self-storage facilities is significant and affects the occupancy levels, rental
rates, rental income and operating expenses of our facilities.
We believe that self-storage facilities, upon achieving stabilized occupancy levels of
approximately 90%, have attractive characteristics consisting of high profit margins, a broad tenant base
and low levels of capital expenditures to maintain their condition and appearance. Historically, upon