CubeSmart (CUBE) 2013 Q4 法說會逐字稿

Good morning, and welcome to the CubeSmart fourth-quarter 2013 earnings conference call.

(Operator Instructions)

Please note: This event is being recorded.

I would now like to turn the conference over to Mr. Charlie Place, Director of Investor Relations. Mr. Place, please go ahead.

Thank you, Amy. Hello, everyone. Good morning from Malvern, Pennsylvania. Welcome to CubeSmart's fourth-quarter 2013 earnings call.

Participants on today's call include Chris Marr, President and Chief Executive Officer, and Tim Martin, Chief Financial Officer. Our prepared remarks will be followed by a Q&A session. In addition to our earnings release, which was issued yesterday evening, supplemental operating and financial data is available under the Investor Relations section of the Company's website at www.CubeSmart.com.

The Company's remarks will include certain forward-looking statements regarding earnings and strategy that involve risks, uncertainties, and other factors that may cause the actual results to differ materially from those forward-looking statements. The risks and factors that could cause our actual results to differ materially from forward-looking statements are provided in documents the Company furnishes to, or files with, the Securities and Exchange Commission, specifically the Form 8-K we filed this morning, together with our earnings release filed with the Form 8-K, and the risk factors section of the Company's annual report on Form 10-K.

In addition, the Company's remarks include reference to non-GAAP measures. A reconciliation between GAAP and non-GAAP measures can be found in the fourth-quarter financial supplement posted on the Company's website at www.CubeSmart.com.

I will now turn the call over to Chris.

Thank you, Charlie. Good morning. Our extremely high-quality portfolio, leading-edge systems, revolutionary customer service, and razor-sharp focus on the details produced solid fourth-quarter results, capping a strong 2013 for our Company. For the second time in 2013, we posted sector-leading quarterly same-store revenue growth at 6.7%.

Occupancy remained the dominant driver of our revenue growth in the fourth quarter. Revenue per occupied square foot continued to expand its contribution to total revenue growth, driven primarily by reduced discounting and increases in in-place rents.

Performance was robust across our markets. Of our markets with significant same-store square footage, our Florida markets led the way, collectively producing 9.4% revenue growth, primarily on occupancy gains. And our New York/North Jersey portfolio produced 7.1% revenue growth on a balance of occupancy gains and rent growth.

Other strong markets include our Philadelphia/South Jersey portfolio, with 9.8% revenue growth on a 630-basis-point increase in occupancy. And our Austin/Houston portfolios, with 8.8% revenue growth on a 640-basis-point increase in occupancy. Our seven properties in El Paso, Texas, continue to be our challenge, with flat occupancy and negative 5% revenue.

External growth was very robust during the quarter. We closed on our $316-million joint venture transaction, and $57 million of wholly owned acquisitions. In addition, we sold 22 assets for proceeds of $90 million. We have a solid and experienced management team that is well positioned for the opportunities we see before us.

I will now turn the call over to Tim Martin for a more detailed review of our fourth-quarter results and 2014 expectations.

Thanks, Chris, and thank you to everyone on the call for your continued interest and support. As Chris mentioned, our fourth-quarter and 2013 full-year results reflect our continued focus on executing our business plan. Full-year FFO per share as adjusted of $0.91 was well ahead of our original guidance range, and represented 23% growth over 2012. This was supported by solid portfolio performance that resulted in same-store NOI gains of 7.3% for the quarter, and 9.3% for the year.

On the revenue side, occupancy gains across our portfolio continued to be the primary driver of growth, as same-store portfolio physical occupancy ended the year up 390 basis points. After averaging flat expense growth over the previous four years, increases in real estate taxes this year were the primary driver of our growth in same-store expenses. Looking ahead to 2014, we see a very positive environment for storage fundamentals, with strong consumer demand, and little to no impact from new supply.

We included in last evening's release our FFO guidance range of $0.98 to $1.02 per share for the full year, and $0.23 to $0.24 per share for the first quarter. As is our practice, our FFO guidance ranges are on an as-adjusted basis, and exclude the impact of acquisition-related costs, given the unpredictability and non-recurring nature of those costs. At the midpoint, our 2014 FFO-per-share guidance represents 10% year-over-year growth. Embedded within our same-store revenue growth guidance of a historically strong 5% to 6%, is the assumption that occupancy gains will continue to be a meaningful driver of growth, and we expect to see an increase in contribution coming from increases in our effective rental rates.

Looking at our expense guidance, our expectation is for same-store expense growth of 3% to 4%, and there are two key drivers included in our guidance. The first is the impact of weather. Not only have we experienced severe temperatures and snow-removal costs across many of our markets, we are coming off a 2013 baseline that had lower-than-normal levels of these costs.

The second driver comes on the real estate tax line item again this year. And while we don't expect the growth to be as high as we experienced in 2013, the growth in taxes continues to be a big component of the upward pressure on our overall expense growth.

From a balance-sheet perspective, 2013 was another active year, as we further strengthen our financial profile. During the fourth quarter, we completed our second $250-million senior unsecured note issuance, following our debut bond deal back in mid-2012. We were delighted with the execution, and the continued interest and support we received from our fixed-income investors.

Overall, during the year, we further reduced our levels of secured debt, ending 2013 with a secured debt-to-gross-assets ratio of only 7%. Overall leverage levels ended with debt to gross assets of 41.3%. We further extended and staggered our debt maturities, and ended the year with a weighted average debt maturity of 6.5 years, no debt maturities in 2014, and less than 14% of our debt maturing in the next four years. We ended the year with $261 million available under our revolving credit facility.

We remain committed to maintaining our strong credit metrics, and are focused on our objective of achieving a BBB, Baa2-rated balance sheet. Moody's upgraded their outlook on our existing Baa3 rating to positive back in September; and Standard & Poor's followed with their upgrade to a positive outlook on their BBB minus rating in December. Both of these actions reflect the progress we've made towards our rating objectives.

In 2013, we actively used our at-the-market equity program to support our above-average levels of investment activity, raising net proceeds of $47.9 million in the fourth quarter and $100.6 million in total for the year. We are well positioned entering 2014 to fund our external growth at targeted levels and beyond, and we have capacity on our line, and access to a broad array of capital sources.

And on a final note, our quarterly dividend increased 18% in December to $0.13 per share, reflecting a continued focus on sharing growth in our cash flows and profitability with our shareholders, while being mindful of retaining an appropriate amount of capital to support the Company's growth. Thanks again for joining us this morning.

And Chris, I will turn the call back to you.

Okay. Thank you, Tim. As we move more deeply into 2014, we continue to focus on execution, maximizing the cash flow from our existing assets, with continued growth in our occupancy and asking rents. Our disciplined investment strategy is focused on quality, not quantity. Funding our growth in a manner consistent with our strategy of improving our credit ratings, our portfolio is in exceptional shape. The lack of new supply in our markets, combined with our strong demographics and advantage in customer capture and care, has us well positioned heading into the prime rental season.

With that, operator, we would turn it over for questions.

Thank you.

(Operator Instructions)

Gaurav Mehta, Cantor Fitzgerald.

You talked about your expectations of further occupancy gains and asking rents in 2014. Are you able to talk about how much occupancy gains and rent increases you are expecting?

We have been fairly consistent on our thoughts about peak occupancy in the same-store pool. And again, it's obviously, as we've talked about forever, the goal is to maximize revenue, not just the individual components that drive that revenue. But this same-store pool, we continue to believe, can peak out at the end of July in that 92% to 93% range from a physical occupancy perspective.

From a rent perspective, it is a pretty broad range. We are up about 2% at this point in terms of our asking rates relative to where they were at this time last year. We think we can push further north from there, but that answer is going to unfold as we get into the busy part of our rental season.

Okay.

And your 48 assets going in your same-store pool in 2014. What's the impact of those assets on your guidance?

The impact to our guidance of adding the 48 stores is about 50 basis points to our growth rate.

Great. That's all I had, thank you.

Christy McElroy, Citigroup.

Good morning. Just a follow-up on the prior question.

Chris, you mentioned the 92% to 93% peak in July. Is that peak in your portfolio, or is that peak for this year in July?

The portfolio -- obviously, the same-store portfolio changes on an annual basis. But as we look at our revenue management systems -- and again, the goal of maximizing revenue, that feels to us like that's a peak occupancy that we would want to achieve in the portfolio.

Over time, or in 2014?

In 2014, that same-store pool, that 92% to 93% is where we think that pool can peak out.

Got you.

And then in Q1, embedded in your guidance, how much of an additional occupancy quarter-over-quarter drop-off could you potentially see in the quarter from the year-end 88.9% level. Can you tell us where occupancy is today versus a year ago?

If you think about December 31, 2013 and then rolling into 2014, January was a solid month, given the weather, snow, and other issues. So we ended January effectively pretty flat to where we were at the end of December.

And as we go into February, I would say February, to date, has been a positive net rental month. We would expect it to end that way, and we will pick up a few basis points of occupancy in February.

Okay. So you could potentially have a little bit higher occupancy in Q1 than you did at year end?

Yes.

Okay. I know you don't have any acquisitions in your guidance, so you wouldn't have any associated funding in there; and you talked a little bit about sources of capital. But if you did see further acquisitions this year, how are you thinking about your funding options?

If you did complete another $100 million to $200 million, as is your goal, how should we be thinking about the funding and the incremental FSO accretion that those acquisitions could provide?

Once you get beyond (multiple speakers) -- If you get beyond our guidance, Christy -- this is Tim -- we are consistently going to look at that in a way that is neutral to our desire to be a BBB-, Baa2-rated company. We believe our credit metrics today are very consistent with that ratings objective.

But as we grow, and certainly if we were to grow beyond the targeted investment levels, we would look to fund that in a manner that is consistent with those leverage and overall credit metric objectives. So we would look to utilize the ATM, and use our line of credit, and ultimately term out debt by accessing the public bond market, as we have over the past several years.

Okay. Thank you.

Todd Thomas, KeyBanc Capital Markets.

Just first question on discounting.

Chris, can you tell us how much free rent you gave away in the fourth quarter? And how that compares year over year?

Sure. As we talk about discounts or promotions, over time we've looked at it as a percentage of in-place rents. And so discounts were down as a percentage -- the percentage of customers is down about 5% -- 5.3%, to be exact, in the fourth quarter.

Okay. How much more discounting, or how much would you expect reduced discounting to contribute to the top line in 2014? If we think about the revenue growth, how much is baked in there from further reductions in discounting?

If you look at its individual contribution to the guidance range for same-store revenue, discounting as its own contribution is about 0.5% of the overall growth rate. Another way to think about this over time is, if you look at discounts as a percentage of revenues at about 5%, obviously, your opportunity set then is to bring that all the way down to zero.

That is not going to happen. We think about that range; if you were in that 3% to 3.5% range, you've probably taken your discounts as a percentage of revenues down as far as you can, given the churn in the units that are left available at those high levels of occupancy.

Okay. In terms of existing customer rent increases, I was wondering what that will look like in 2014 as the peak leasing season gets underway? Maybe you could talk about the number of customers in the portfolio that are eligible for rent increases today? Maybe how that compares year over year? And also the magnitude of the increases that you expect to try to push through?

Hello, Todd, it's Tim.

We don't expect there to be any meaningful change in our approach to passing along rate increases to existing customers than what we have talked about in the past. Again, we look to pass along an increase at about the 6-month mark to customers, and then every 12 months thereafter.

We have discussed historically that those rate increases range from 4% or 5% to some customers, to low double digits for other customers. And those have averaged, over time, call it 8%, 9%. In a consistent application of that approach, year after year and period after period, it doesn't create a lot of revenue growth, per se, because we have been so consistent in our approach.

Okay. You mentioned El Paso was a weak market. I know it is not a very large market for you, but I was just wondering what's going on there that's causing that decrease in revenue growth and presenting some of the challenges? Is it new supply that's come online? Or is there something else going on there?

In El Paso, for our stores, which are only seven, it is directly related to the transition of our military. We are closely located to the military base, and as our troops come home and are not being redeployed, we are in a position here where we just have net move-outs. The troops come home; they don't stay in El Paso, so they take their possessions out of their storage cube and leave town.

Okay, got it. All right. Thank you.

Brandon Cheetham, SunTrust.

Good morning.

We have seen your advertising spend come down a little bit over the past couple quarters. I was wondering if you could give me some idea on what you expect that to be for 2014?

Sure; this is Chris.

I will start with the trend and then answer the 2014 question. As we look at our spend, primarily on the internet, month to month, quarter to quarter varies based on the returns that we are seeing.

So obviously -- and Tim's talked about this before -- if we were seeing superior returns and we are spending more, obviously, that works well for our model. If the returns are acceptable at the levels of spend, we spend accordingly. So it will vary, depending upon what we are seeing.

As you look at 2014, we expect 2014 to be about up 2% in terms of our planned spend relative to 2013.

Okay, that's helpful.

Looking at your Las Vegas/Arizona assets, it seems like the revenue growth there isn't as significant as some of your other markets. Can you provide some color -- if there are any outlying factors that might be affecting that? Or is it just challenging to (technical difficulty) --

Yes, it's three markets -- I think that three distinct markets that go into that number in the supplemental package. Las Vegas for us is only a couple of assets, so that is not really meaningful in terms of our overall results.

In Arizona, we have a nice portfolio in Phoenix and we have a pretty significant portfolio in Tucson. Tucson is a retirement- and school-, college-oriented town. Not a lot of REIT competition. Some good local competition.

It is just a matter of movement. We just have not seen over the last few years a significant, dynamic movement there. So while occupancies has been climbing upward, we haven't had much success in pushing street rent.

Phoenix, coming out of the recession, has actually started to move in a pretty good direction. We're pretty confident about Phoenix in our portfolio in 2014, but somewhat similar to Tucson, we have seen good occupancy upwards; have not seen much ability to push street rent.

Okay. Last one, on occupancy so far this quarter, can you talk about how move-outs have changed year over year? Are you seeing a bigger decrease through the start of this year? And maybe that's weather-related?

Vacates, interestingly, thus far this year are slightly behind where they were last year, and that is obviously on a higher occupancy. So on a per-occupied unit basis, they have actually come down.

Now whether that is weather-related or not is hard to say. But haven't seen materially any real difference in pattern. I think the weather impacts people leaving as much as it impacts people moving in.

Right, okay. Thanks a lot.

Shahzeb Zakaria, Macquarie.

Good morning.

My question is regarding the composition of the same-store pool. I understand that at the turn of the year, you will include assets in the same-store pool that you've owned for a full year and that you consider stabilized. I believe last year, of the 16 legacy storage [deluxe] assets that were eligible to be added to the pool, you guys actually added eight and left out the other eight as you possibly deemed them not stabilized.

My understanding is that, barring the two assets in Queens and one each in Pennsylvania and Bronx, all of these assets were over 80% occupied at the time of the acquisition. It seems like you have a somewhat strict criteria for the composition of the same-store pool. It's certainly more strict than I had initially thought.

Could you help us understand that process a little better -- how you go about determining if an asset is stabilized? Is it occupancy only? Or do you also look at the tenant [reinsurance] penetration levels? Any color around that would be great.

Sure, Shahzeb, it's Tim.

Your facts as you outlined them are all accurate. And our determination as to whether something is stabilized is primarily an occupancy-level determination. The uniqueness, perhaps, to our approach is that it is an occupancy -- look at that asset in the market that it is in. So generally speaking, it is in the low- to mid-80%s, represents a stabilized occupancy, and if the asset was owned for the entirety of both periods presented, then it would be included in our same-store pool.

Switching from our same-store pool that we ended 2013 with, 298 assets, we are adding 48 assets that were owned prior to January 1, 2013, and were stabilized throughout 2013. So they are added to our same-store pool for 2014, and that brings our same-store pool up to a total of 346 assets.

And Shahzeb, it's Chris.

You have to look at that occupancy over the -- the average over that entirety of that prior period. So if a store started the year, say, at 65% physical occupancy, and ended at 80%, it would be disingenuous in our view to put it into the same-store pool the following year, because for the first half of that year, you're getting that huge advantage of that 65% in climbing occupancy compared to 80% in climbing occupancy.

Not really a true reflection of same-store growth. I would agree with your description of our approach as being pretty conservative.

Thank you guys. One last question.

Would you be able to share what your fourth-quarter same-store revenue growth would have been had you not sold the 22 assets during the quarter? Would it have been the same, a little up, or a little below?

It's a hard question to answer, because we didn't own the assets for the entirety of the period, so it's a --

Was the pace of growth, say in the third quarter, higher than the portfolio that you've left behind, or was it below the growth rate? The trajectory --

I think directionally, it wasn't that significantly different than the pace of growth of the remaining assets. And the occupancy in those stores wasn't that materially different than the balance of the same-store portfolio.

Got it, that's helpful. Thank you so much, guys.

Jana Galan, Bank of America Merrill Lynch.

Good morning.

Can you update us on the amount of supply you are seeing in your markets?

Yes, Jana; that has been the fabulous story about our industry for the last several years. We are really seeing very little supply. In the fourth quarter, new stores competing directly with a CubeSmart across the entirety of our portfolio numbered six.

It has, and continues to be, a huge help to our industry -- just the general lack of new supply across the country.

I guess those six, is that primarily the New York area?

New York, Texas, is what comes to mind in terms of where we have seen openings. One in northern Virginia.

Given the occupancy gains and your acquisitions, can you comment on the mix in the portfolio between residential and commercial tenants?

No significant change. We still -- and again, some of this is our best guesstimate, given that some of our commercial customers actually rent from us in their personal name. We still look at our commercial penetration being about 30% of our square footage.

Thank you.

(Operator Instructions)

Tom Lesnick, Robert W. Baird.

Good morning, guys. I'm standing in for Paula today.

Just touching on CMBS debt real quickly, I believe you have some maturities beginning in 2015. How much, if any of that, is prepayable in the second half of 2014 as those maturities near?

The CMBS debt, and one of the reasons that we're not big fans of CMBS debt, is you have very little flexibility and ability to prepay it. The only significant amount that we have left does mature in December of 2015. And off the top of my head, I don't think we can prepay that any earlier than 90 days in advance of its maturity. So we are locked out from doing anything as it relates to prepaying that debt in 2014.

All right, great. That's all I've got. Thanks, guys.

(Operator Instructions)

Trish Azeez, BMO Capital Markets. Pardon me, you've been moved up to the question queue. Do you have a question?

Chris, you can take this question. (laughter)

Ms. Azeez, have you muted your telephone?

Oh, excuse me. So sorry about that.

Chris, this question is for you. Could you talk a little bit about your third-party management platform and how it has trended over the past couple of quarters? Maybe if you guys are ramping up your marketing efforts there?

Sure, thank you.

The third-party management business, as you all know, continues to be a very important portion of our overall strategy. We've acquired a significant amount of stores from those relationships, and it's obviously a great way to leverage our platform.

The changes, I would say, over the last 90 days or so, in terms of the inflow from that business and the folks who are calling us to inquire about utilizing our third-party management, is it has been a little bit more of a mix over the last 90 days between folks who have stabilized assets where they are struggling, and looking for a larger platform; and folks who are contemplating developing a self-storage asset, but have either figured out on their own, or their capital source has clearly let them know, that they need to have the power of a larger brand and all of the revenue and occupancy opportunities that come along with that.

I would say that really the only change in pace has been a mix between assets that are to be constructed, in addition to ones that are stabilized. But the overall inbound inquiries continues to be quite strong.

We have transitioned the leadership of our third-party management program from Carol Shipley, who retired at the end of January, to Guy Middlebrooks. And Guy continues to see good inbound call volume from folks who are interested in working with us.

I think the change in leadership leads, obviously, to a fresh way of looking at things. So I'm confident we will have different marketing strategies as we go through 2014.

But the core of it is, our brand, our revenue management, and property management expertise. And the vast majority of the folks in the business or looking to get into the business know who we are. So we tend to see the majority of our success coming from inbound as opposed to pure marketing efforts.

Okay. Can you remind us if all of the assets in that platform had the CubeSmart branding?

Yes, they do not.

We do not require our owners to rebrand as part of our program. Many of our owners have elected to do so. They recognize the power of being in the brand and having their store branded CubeSmart, but it is not an absolute requirement of our program.

Okay, and lastly on that, how selective are you in deciding what properties you will manage? What percentage, would you say, you are turning away from management?

It's hard to put that in a percentage, but I would say we look at it in a very straightforward way. We ask ourselves three questions: is this an owner or ownership group that we can work well with, because it is truly a partnership, and we need to be able to have a like mind in terms of property operating philosophy.

The second question is, would we one day wish to own the store? And then lastly, can we make money, given our infrastructure in that particular market by adding an additional store without having to add incremental costs?

So we look at it through that lens, and that's generally -- that lens is how we make decisions as to whether accept or not the opportunity.

Great. That's it for me. Thanks, guys.

RJ Milligan with Raymond James.

Chris, I was wondering if you could give us a little color on cap rates? What you're seeing out there in terms of acquisition opportunities? Maybe Dean left his crystal ball around and (laughter) -- Where do you think cap rates might be going over the course of the year?

Right, RJ, he took that crystal ball with him, so that crystal ball is in Miami, Florida, at the moment.

As you have seen in some of the public disclosure, cap rates do continue to tighten. If you take the boroughs of New York off the table for a moment and you look at single assets, stabilized deals in the quality markets we are interested in around the United States, you are in that 5.5% to 6.5% cap range for a single asset stabilized.

Obviously, larger portfolio deals have ground even tighter than that. In New York, in the boroughs for a quality asset, 5% cap is where the conversation would start. Wouldn't surprise me if there were sellers they thought they could do even tighter than that.

It's had us be, as I said at the beginning, very disciplined in our approach. We know the markets we want to be in. We're looking at opportunities that are additive to the quality of our portfolio. Again, quoting going-in yields, as I did, we obviously underwrite with an expectation that by putting the store into our brand, by adding our expertise and systems, that we will be able to improve upon that fairly quickly.

Even the best small and local management teams just don't have the same scale, obviously, that CubeSmart does, and we do create some good revenue growth out of the gate with our brand and revenue management.

The larger portfolios for us -- many of them tend to have a fairly mixed quality to them. As a result, we tend not to look and spend a lot of time on deals that we think are dilutive to the quality portfolio that we have worked very hard over the last few years to assemble.

That's helpful.

That incremental yield that you underwrite, as you bring in these smaller properties into the CubeSmart platform -- how much is that incremental yield and how long does that take to show up?

We look out over, call it over the first three years, of the store being in our platform. If we don't have visibility to having that asset yield 7% or more over that time period, that is a struggle for us.

The more bond-like store, where it is 90% physically occupied at market rents; where we don't see, based on the expectations of the seller, the ability to really meaningfully move the top line -- those are filtered through our process pretty quickly.

So would those stabilized, 90%-occupied properties be the only types of properties where the public REITs aren't the most competitive in terms of bidding, because the addition of the platform no longer adds incremental yield?

Yes, hard to make that generalization, because it really comes down to prior manager of the asset and what they've been able to do.

I would imagine that, at least for CubeSmart speaking -- I can't speak for the others -- that when we look at those deals, and if we don't see an upside from the value add of our platform, then you need to look at whether scale in that marketplace, removing a competitor, and other things are creating value for our shareholders over time when it's not so obvious the path to a higher yield.

Just trying to simplify it, is there any competition that you are seeing out there in the top 20 MSAs, other than the other public REITs, for acquisitions?

Yes. More so, I would say, for portfolio transactions; much less so for single asset deals.

Okay, thanks, guys.

Jeremy Metz, UBS.

Hello; hopefully two quick ones.

Can you give the actual dollar amount of concessions for new tenants in fourth quarter?

No, we don't normally get down to that level of detail.

Okay. Can you say -- I think last quarter you said it was close to the low $70 range. So was it above or below that? Are you able to say that?

I don't recall saying that, but the fourth quarter, typically -- again, in a period where you have some degree of net move-outs, you would see a little more aggressive discounting than you would in a third quarter, where it is generally more of a net move-in quarter.

Okay. And it was down, though, you said, 5% year over year?

Quarter over quarter, that's right; fourth quarter 2012 to 2013.

Okay. And then, if you look at your realized rent per occupied foot, it edged up a little. I think it was 1.4% year over year in fourth quarter. Is this a trend you see continuing to move higher? Or maybe getting into that 2.5%, 3% range later in 2014?

This is Tim.

It is certainly going to be a bigger contributor to our growth going forward than it has been, as we adjusted rates pretty significantly in 2012. We got to the point where that line item started to be additive to our topline growth the latter part of 2013. So we continue to see that trend continuing to grow into and throughout 2014.

Okay; thanks, guys.

(Operator Instructions)

I'm showing no further questions. This concludes our question-and-answer session. I would like to turn the conference back over to Chris Marr for any closing remarks.

Okay, thank you. Thank you all for joining us.

As you can tell, we are incredibly enthused and excited about the opportunities in front of us. We are looking forward to a very strong rental season.

We continue to see good opportunities in our target markets from an acquisition perspective. And we think 2014, for the self storage industry in general, and for CubeSmart specifically, is going to be another great year.

Thank you for your participation and we look forward to speaking to you all at the end of our first quarter.

The conference is now concluded. Thank you for attending today's presentation, and please disconnect your lines.