(Reuters) – Extra Space Storage on Tuesday forecast 2024 core funds from operations below analysts’ estimates, as demand for self storage spaces decline from the highs at the peak of the pandemic.
The return-to-offices by employees from remote working setups coupled with a decline in homes sales have weakened demand for storage, forcing self storage companies to lower rent to attain new customers.
The self-storage REIT now expects 2024 core FFO between $7.85 and $8.15 per share, compared with estimates of $8.34 per share.
“While we expect a headwind from lower new customer rates, we are confident in the durability of self-storage,” CEO Joe Margolis said.
The REIT, which owns more than 3,600 storage stores in 42 different states, reported a fourth-quarter adjusted FFO of $2.02 per share, narrowly falling short of analysts’ estimates of $2.03 per share, according to LSEG data
Total revenue for the quarter ended Dec. 31 came in at $797.8 million, compared with estimates of $720.8 million.
(Reporting by Abhinav Parmar and Kannaki Deka in Bengaluru; Editing by Shailesh Kuber)
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