Greetings. And welcome to the Sovran Self Storage Second Quarter 2013 Earnings Release. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Diane Piegza, Vice President of Corporate Communications for Sovran Self Storage. Thank you. Ms. Piegza, you may begin.

Thank you, Melissa and good morning. Welcome to our second quarter 2013 conference call. Leading today's call will be David Rogers, our Chief Executive Officer. Also participating are Andy Gregoire, Chief Financial Officer; Ed Killeen, Executive Vice President of Real Estate Management, and Paul Powell, Executive Vice President of Real Estate Investment. As a reminder, the following discussion and answers to your questions contain forward-looking statements and Sovran's actual results may differ materially from projected results. Additional information concerning the factors that may cause such differences are included in our company's SEC filings. Copies of these filings may be obtained by contacting the Company directly or the SEC. At this time, I'd turn the call over to Dave Rogers. David Rogers Thanks, Diane. Good morning everyone. This was a good quarter, I will let Andy give the details on our operating performance but the picture is customer queries are up, closing rates are up, occupancy is up, in place and asking rates are up and our top line is up almost 9%. And now that we are pretty deep into the busy season we developed a sense to what the next two or three quarters will bring and they are looking very good. We didn't acquire any properties in the quarter, but we have been busy on the acquisition front. A couple of bigger portfolio came on the scene recently, one been sold to a company other than ours and the other one is still in play and we have been active in both of those transactions. Aside from that, we have three class A properties under contract, two of them are on Long Island, one is in Colorado Springs, Colorado and the total of our $28 million purchase price. Even though these are stabilized stores with occupancies in the…

Thanks, Dave. Regarding operations, same-store revenues were strong again, increasing 8.9% over those of the second quarter of 2012. This was our fourth consecutive quarter of 8% or greater same-store revenue growth and a record growth. The growth was primarily as a result of the 380 basis point increase in average occupancy and a 3.6% increase in rates, as we saw pricing power begin to show up in the rents collected. Same-store occupancy at June 30, 2013 was 91%, another record for our company for the month of June. We also continue to see a meaningful 30% increase in tenant insurance income on a year-over-year basis. Total property operating expenses on a same-store basis increased a modest 2.4% as a result of the expected increases in the real estate taxes and insurance. Partially offsetting these increases was the continued decrease in the yellow page spending and our control of personnel cost and utility. As a result of the continued strong revenue gains and controlled expenses, same-store net operating income increased a very nice 12.2%. This was also our fourth consecutive quarter of same-store NOI increase of 10% or more. G&A costs were $1 million higher this quarter over that of the previous year. Aside from the $300,000 increase in internet advertising, the main reason for the increase is the fact that we operated 25 more stores at the end of this quarter as compared to April 1, 2012, also the continued investment in revenue management system and incentive compensation related to our improved results. Offsetting a portion of the overhead costs is an increase of over $190,000 in third party management fee earned this quarter. Regarding properties, Dave mentioned the three stores we have under contract for approximately $28 million. On the disposition front we may look improving few properties…

Okay. So before we open it to Q&A I'd like you to see how we are viewing the Self Storage environment. Certainly the macro fixture comes into play here. Demand is growing across the sector as a result of a somewhat healthier economy and an uptick in housing markets. You know for almost 30 years we have been saying that when tough times hit, Self Storage suffers the effect later and less severely than other property types and recovers more quickly. And this is certainly being borne out with the events of recent years. Even with the anemic recovery that we are experiencing so far, saw it come around really well. And of course the dearth of new supply coming on board that allowed a lot of space to get absorbed. But the macro impact is only part of the story. Probably more than any other sectors, storage benefit from scale and with almost five minute stores lying in the Uncle Bob's banner we have the capacity to invest heavily in the platforms most critical to running our business. We are driving record traffic to our stores as a result of our web based marketing team, the folks in our state-of-the-art customer care center are providing terrific service and they are achieving high closing rates in the process. Our revenue management group is managing big data. We are able to power the information on hundreds of thousands of units in close to real time and that rates and incentives to current market conditions, even predicting what demand will be and thus giving us unprecedented pricing power. Our other initiatives Uncle Bob's third-party management, corporate alliance program, our online training program these are all possible because of our scale. So we have an immeasurable advantage over most of the industry, and I think it's setting us for outside growth in the quarters and years to come. We really like where we are right now. And with that Melissa we'll entertain questions.

Thank you. (Operator Instructions) Our first question comes from the line of Christy McElroy with UBS. Please proceed with your question.

Hey, guys good morning.

Good morning, Christy.

Good morning.

Clearly you've been pushing more in rents in recent quarters. Given that your move-ins are down about 5% year-over-year and your move-outs are up about the same amount, what kind of impact do you think your efforts to raise three has had on move-ins and sort of the same question on existing customer rent hikes and the impact on move-outs.

Hi, Christy its Andy. You know when you look at the move-ins being down year-over-year that's expected with this occupancy where we are at. We turn away people every day, so we expect that. Our pricing is that so that we turn away this number of people so we maximize revenue. So we are fine with what we are seeing with occupancy growth from an in point of view. From an out point of view, if you look at our outs compared to our total population of customers, those move-outs are identical. 20% of our customers move-out in a quarter that's consistent year-over-year. So the increase analysis sort of you know it doesn't compare apple to apple, you have to look at your customer base. So the outs increase doesn't surprise us at all, it's exactly what we expected at 20% of our occupied spaces.

Okay, can you disclose year-over-year change in asking rents in Q2? I think in April you mentioned it was up 7% and when you talk about asking rents, is this an average of the rents that you are quoting to new customers or is this the rent that are actually moving in that?

It's the average we are quoting the customers I mean showed the increase. In May we were up 7.5 --

7.5%. 5.7% over the previous quarter.

And if I were to look at the move-in rents is that something you track and if so, is that any different?

No, that would be the same. The rates are up that much it's obviously the move-ins are 43,000 for the quarter.

The quoted is the paid in our world, I mean there is you know consumptions in the form of maybe a pre-lock or what have you, but the price is the price the customer care of, you know there is no negotiating so that is the move-in price.

And where is your asking rents today versus where they were sort of at the bottom and then versus where they were at the peak?

They are -- at the peak last year was 11.48 so it's about 7% above the peak today.

I guess I am thinking peak in terms of sort of prerecession and then bottom kind of where you were in the last couple of years?

I don't have any assumption here of the bottom --

Bottom of O&I that will be a big number percentage wise.

We can certainly get that number and get back to you, Christy.

Okay, we can think. I just have really one quick last follow-up question Dave, just wanted to kind of follow-up on your macro comments on the subject of market share. Clearly the larger operators have been doing better than the smaller operators and that also helps to drive some growth in the property management platforms. Can you give us a sense for how smaller operators are performing today?

They are performing pretty well actually. I think from the end of 2011, beginning of 2012 they started to see a turn from the three years of negative same-store rev at least top line. You know we came out of that right away in 2010, those folks at least a couple of years more, but from what we see on our acquisition due diligence the properties we are looking at on the Uncle Bob's management due diligence you know it's not a proper scientific example because it's probably you know probably been about 400 to 600 stores this year that we look at of the smaller variety and we are definitely seeing uptick in occupancy a little bit of rate. So deriving high is certainly helping all of us but not to the degree I don't think that is helping the public companies by any stretch.

Okay, that's helpful. Thanks guys, that was all the questions.

Thank you. Our next question comes from the line of Todd Thomas with KeyBanc Capital Markets. Please proceed with your question.

Good morning, guys.

Good morning Todd.

I am on with Jordan Sadler as well. So just first question in terms of acquisitions Dave, you commented about the slow start of the year but sounds like you're expecting that to ramp up a bit. I know you talked loosely about $100 million to maybe $150 million of acquisitions being a target. There's nothing stated in the guidance. So I was just wondering if you still feel comfortable with that range for the full year.

Hi Todd, this is Paul. Yeah, we still think we're looking at probably over $500 million worth of property. And we expect to still do maybe $100 million to $150 million this year. We are seeing quite a bit more activity as far as opportunities, we're working out market with some sellers. So we are expecting the fourth quarter to be fairly active for us.

And how you characterize the product that you're seeing in terms of occupancy and pricing, and have you changed your return threshold at all just given the recent rise in interest rates?

No, we have not. I mean the cap rates still are compressing a little bit especially with some of the transactions that have taken place during the last month or two. We are targeting opportunistic deals, the low five cap open to the growth where those 100 basis points to 150 basis points in the first year. Stabilized assets, we're targeting those sixes. So that really hasn't changed.

Todd, we had a bit of a sea change in the way that we evaluate properties over the last probably year, year and a half. Because we -- year before what we used to look at is stabilized property was 85%, 86% and now we're seeing that this is in the right market and right kind of store, that stabilization for company like ours might be 91% or 92% or at least in peak season and have an average of 88% or 89%. So we're looking in that sense we looked at a lot of the acquisitions we done over the last 2.5 years, 3 years. And saw that we profited more than we really expected to. And it's basically because we can do it with our platform. So in that sense I think we've looked at acquisitions a little more aggressively because we know we can ring more out of property then we thought we could invest.

Okay, that's helpful. And then just shifting over to some leasing, can you just talk about or kind of quantify what the concessions were in the quarter? How much you gave away in free rent? I was just wondering how that was relative to the second quarter of last year.

Todd, this is Ed. We continue to reduce our concessions. 48% of our customers received a concession versus 70% last year, year-over-year Q2 and 73% the previous quarter. And the value of those concessions offered are also down 25% from $73 a month to $50 to $55 a month 2Q year-over-year.

Okay. So and the $55 a month, I am just wondering if you can help us understand how much more upside there is to that over the next couple of quarters, right? So in 2012 you had the large spike in occupancy, the big occupancy gains that led to an increase in new rentals which tends to come alongside concession one or more months maybe a free rent. So you essentially your tenant acquisition cost increased significantly 2012 now as in normalizing. Can you help us understand what that impact might be going forward to rental income growth and how we should sort of think about the customer acquisition cost?

Well it is getting a bit tighter. But we do see this trend continuing. I mean demand is up, all the metrics in regards to web marketing and anywhere else where we measure demand pickup and we continue to run. And we continue to increase occupancy and therefore the concessions, we will continue to be able to drive those down a bit to the same degree that we've been at over the last several quarters, doubtful. But we see the next couple of quarters, we should see those reducing a bit.

Okay, great. Thank you.

Thank you. Our next question comes from the line of David Toti with Cantor Fitzgerald. Please proceed with your question.

Cantor Fitzgerald: Hey, guys. Good morning.

Good morning, David.

Hey, did you give any of those details on that large portfolio that you mentioned, were you able to talk about that at all?

You know, it's still in play so.

Yeah. The Morningstar portfolio is the one that's still in play at the moment. We're actively finalizing our underwriting, and we hope to get our final offer out in the next week or two. Where it's going to transact, is anybody's guess at this moment.

Is that the only sort of kind of way allowed there or is there a little bit of dislodging happening with some of the bigger portfolios.

That's the biggest one out there now, David. There's a few other smaller portfolios that are being marketed by some brokers, and we're looking at those as well, but this is the big one that I think everybody's taking a close look at.

And I just want to go back to Christy's question on the move-ins and the move-outs sort of they kind of squeeze given the lower vacancy. And at certain point, does that lack of empty product really help to crimp your win growth potential. Just because you don't have the inventory, you kind of like capture the street rate pricing power?

Well David, we take a look at our pricing power from a couple of different ways, both from a very granular perspective and through quite a wide lens. But if you look at -- if you look at where we are right now, the story now for sort of filling that gap, that gap between where we are in occupancy and 100% occupancy, it's all about sort of employing and refining the processes that we have. The smaller the gap, that gap between the current occupancy either it impact demand or your 85% occupancy is left and you have effective management tool, which of course we have, there is abundant stake available for customers. And in most cases, it's relatively simple to repaying and growing occupancy of it. Now 86% to 89% or we are planning over the last couple of years, it's certainly more of a challenge and it really does require higher level of expertise to balance the in-place rates, the asking rents and managing the concessions properly, all in an effort to maximize revenues. And for this you really need to deploy the proper systems and the people. We're at now at 90 plus percent occupancy, it's a whole different beast. You need to be fully engaged and committed to utilizing the very best and most sophisticated systems and management expertise, which we have of course to effectively manage that gap and of course maximize the revenues. So really, as David said before, the feeling that exists, the 88% to 89% feeling, for us, for many years, that's moving and that's maybe moving to the mid-90s, and we've been working in the last couple of years, even coming out of a recession preparing for this. And we’re finding all of our systems, our processes and properly positioning all the great people that we have here, so we do have the know-hows of manage that gap. And again, only manage it in a way that maximizes the revenues. It really isn't rocket science, but we do believe that our efforts in this respect they separate us from the competitors, large, small, REIT, no REIT.

That's a great answer. I have just one more follow-up on that topic. I guess, doesn't that phenomenon as you move into the second half and actually with the higher occupancy level, does that really open up the landscape on the acquisition side to find vacancy to potentially bring development just so that you have that new products on hand?

Yeah, it is something we talk about seriously all the time here is to the extent that we rationale up our own expansion and enhancement program hopefully to double it next year to hit some 50 or 60 stores and improve those with adding 10,000 to 15,000 or 18,000 feet but you are right. Now we are looking at stores where we have people that are developing stores, someone who was looking to manage with perhaps buying FCO and looking at stores that are in the 50% occupancy range perhaps and taking out platforms and running those up. But I think a lot of the policies followed by the CR are a lot of 50% occupied stores that I guess it’s going to stay 50% occupied. We are still having some discussions with the smaller developers possibly JV and look them on development but probably not -- we will not do development ourselves at this point.

Okay, maybe I have to add a second story to some of your space. Thanks for the details guys.

Thank you. Our next question comes from the line of Jana Galan with Bank of America. Please proceed with your question.

Thank you. Good morning.

Good morning, Jana.

I was curious if the uptick in the housing market is that bringing in some more commercial tenants and I don't know, if maybe you are seeing that in larger unit sizes getting rented or just longer lengths of stay?

You know we have always tried to make the marriage between or at least find a link between housing in [Austin]. You know all I can say is when housing goes down, we go down and when housing comes up we go up. It is for such a host of reasons, people who are moving, people who are remodeling, people who are building then you have the contractors who are into the housing trade so there is so many facets you can look at and it is tough to put a price, I would say we -- I can’t say that housing and in particularly regards the products, you know, we are such a broad based supplier of space, everybody is our customer and when it picks up its commercial, its students, its professional, its residential, people who are moving, people who are getting a divorce, getting out from the family so I don't see how we will formulate it.

Well, looking at our commercial business whether it’s our corporate customers or small business customers that’s always been very difficult to quantify. As much as we try to capture that customer profile information at the store level it’s all dependent on how that incoming customer presents the use of storage to us. Typically when it’s a small business they don't even mention to us that they are a small business, they come in and they rent it personally but anecdotally when we are out there, when the area managers are working with their managers on the field the feeling is that there is an uptick in our small business, commercial business customer.

Okay, thank you.

Thank you. Our next question comes from the line of Ki Bin Kim with SunTrust. Please proceed with your questions.

Hello, thank you. In Egypt, I am not sure if I heard it -- a street rate number, could you guys mention that, a roughly rate?

As of the end of July, Stephen?

I guess Paul at the end of the quarter, end of July?

The end of quarter we were at 11.24 and end of July 11.48.

Okay. And have you probably done a study of looking at Europe's street rates compared to your competitors, whether they will be private or public around your -- surrounding your assets and how that I guess maybe more public or private. So how are your street rates compared to your private market operator competition and what that spread looks like and how that changed over time and at what point does that probably become too wide where even though you got a better job on internet and advertising and pricing where it actually widen up before it would start to offset customers behavior patterns and in terms of coming at the year forward (inaudible) I think it's 20% cheaper?

Well, given the figure that your -- that maybe you are looking for it is so very fluid and it’s based upon so many systematic factors from the revenue management standpoint. That in itself is real difficult to quantify. Because on one store you might have a spread of 10% to 15% of one particular space from a nearby time to 3% and that changes throughout from month-to-month and quarter-to-quarter. It certainly does impacts what we do from the revenue management standpoint. I mean that is one of the triggers looking at the competition and seeing where they are. But it is not a significant trigger for us. We look at the comps. But it really doesn’t -- it isn’t a big driver for the decision making when it comes to asking rates.

Great, I guess my concern is that it becomes a fearless driver as that spread, it might potentially widen, right. But with that let me ask this question in quite a different way. What does your system say about -- on that variable single variable about how that has trended?

The old revenue management used to be, we matched everybody around us in a 5 mile radius. All the stores we can find in the 5 mile radius, created them [automatically] and said this is what their rates were. And we pretty much followed the rates. They were all based on price, because the shopping was done beyond the homework and driving around. And it was pretty tight even as recently probably 2007 to 2008. But in the past few years especially I don’t think we’re -- I mean there is markets where we are more than 20% over Mom & Pop but there are other reasons and besides just the fact that we have visibility we have better stores, better service, we have longer hours. There is a whole (inaudible) just put it on price like it used to be. Somebody is out there and said oh! You are kind of here for 70 bucks a month and we’re charging 150, we still get a lot of people at 150. That’s not I mean I am not going to pay $80 which is typical but our 50% typical budget but its certainly possible and that is unusual.

And when you guys check your competition, rates on competition, do you also check -- are you operating corporate promotions that are being offered by the competition into that equation.

That number is difficult to quantify. We certainly look at the comp rates and the web, I mean we all search the web for comp rates. From there you can see the concessions that are offered. But the smaller operators, the Mom & Pop's, you never really know for sure what concessions are being offered until you walk through the doors, so it is pretty tricky to quantify that and frankly we really don’t look at that, and look at the REIT and their concessions but not the smaller operators.

Right. I mean, it’s difficult one to pass I guess. And just one last question, since you’re already probably talking about July I was wondering if you could just go ahead and maybe give some operating status up to July on occupancy or overall revenues.

Sure, yes, we don’t have the revenue statement. Occupancy was 91.7 at the end of July on the same store pool it was 88.7 last year at the end of July. And we talked about rate, they were 1148 at the end of the month of July, last year they were 1063.

Okay. Thank you, guys.

Thank you. Our next question comes from line of Paul Adornato from BMO Capital Markets. Please proceed with your question.

Hi, good morning.

Good morning, Paul.

I was wondering if you could tell us what percent of the same-store revenue increase is attributable to greater insurance penetration?

They are very minimal. They penetrate -- penetration was about the same. We had a change in our share of those commissions. So the penetration uptick was very minimal, less than a 1%. But there was a change in our commission structure with the insurance company.

Okay. Could you elaborate on that?

We cannot disclose our sharing arrangement. Sorry about that.

Okay. Can we assume that's the increase to your benefits?

Correct.

Okay. And talking about acquisitions on that discussion of digging a little bit deeper to some more value add type properties and even development properties what type of volumes you might just see in that category as opposed to fully stabilized acquisitions?

Hi Paul, this is Paul. Yes, we are seeing with the uptick in occupancy even at private operators, you know, the occupancies are all up there. What we are seeing, we are looking at some deals that actually are fairly new, they had some quick lease up but they did that by discounting or special so the spread between fiscal and economic occupancy is quite wide. I mean those I consider somewhat opportunistic just because there is, you know, there is high occupancy but there is a lot of money left on the table for us to be able to get through our platforms. So you know the Morningstar portfolio, that’s occupancy in the low 80's so that’s certainly got some growth opportunity there. Some other deals, the three are under the contract, two properties on Long Island, those are just coming out and it will lease up. They have some occupancy room for some economic growth and then one in Colorado is more stable. So other off market deals that we are looking at that we hope to close later this year, those are mostly stable properties but we still feel there is some room to grow rates and then place rates as well.

Okay. And just looking back to the insurance question, can you tell us when that agreement was renegotiated?

It went into effect in the first quarter of this year. Okay. Thanks very much.

Of course Paul.

Thank you. Our next question comes from the line of Paula Poskon with Robert W. Baird. Please proceed with your question.

Thanks, good morning everyone. Dave, could you talk a little about the trend you are seeing in inbound calls from private owners and the third-party business?

Yeah it’s not changed much from the past couple of quarters. You know there is a lot of trouble stores out there that we have from -- what we think are pretty good reason, probably don't want to get involved with. We are seeing, we are working with some of our pretty established need some help with the lender perhaps or just sort of turning point, you know the quality store right now with the uptick in business, in the cost factor I think we are having a harder time giving people who are scared right at this point or we saw a little wave of that at the end of 2011 where people are saying well you guys are crushing them. We have got to find a way to join their ’13 or get their flag in our store. We are not seeing as much because little bit of successes is making a lot of these guys tensed I would say. One of the things we are seeing a lot of is the potential developer coming in and want to build the store and help us manage it from day one, that’s probably, if I had to guess Paul, the biggest uptick…

We have been seeing a lot primarily that you know I get a call barely now for people wanting to sell parcels but yeah our third-party management team especially at the trade shows majority of the traffic is people who are in the process of building a property and they are looking for third-party management and they are also looking for a negative strategy either (inaudible) or some other occupancy level so that is majority of what we are seeing right now.

That’s helpful. Thanks. And just finally any differences you are seeing in real estate trends or insurance trends across the different markets you operate in?

Paula, this is Andy. I don't know. I think it’s pretty widespread the trends. I don't think there is any market center something out. You know when you look at our revenue growth you still see that (inaudible) majority is not doing that as that shows in our numbers. We had a prior one story, the other story is doing 6% growth so we are doing it right but other trends regarding insurance is not asking anything exciting.

Great. That's all I have, thanks.

(Operator Instructions) Our next comes from the line of Todd Stender with Wells Fargo. Please proceed with your question.

Hi, good morning everybody.

Good morning, Todd.

Just kind of looking at your sources of capital right now, how are you thinking about that the very side of your balance sheet obviously low level stock prices are up, you’ve raised dividend twice this year. So the OP units are probably attractive to a private seller. How do you kind of think about what you’re going to tap for new acquisitions.

I think we’re going to maintain our strategy, use the ATM on the smaller acquisition to match fund but I think we’ll be consistent there, We’ll make them from that, other than any other large portfolio like a Morningstar we would -- we would want to tell that story and do a traditional offering. But similar mix probably 70% equity. It’s kind of original thinking path with regard to the OP units I think. We’re still having a tough time, we bring a lot of potential sellers in with the idea of the OP units but at the end of the day it’s usually a cash transaction. We'd love to use that as our currency but it’s been tougher to do.

Okay, that’s helpful. And with the quick move in interest rates since May, we’ve heard this in other sub groups of the REIT world, it’s impacting the pace of deal flow. Are you guys seeing any stall in sales activity or acquisition opportunity because of the rise in interest rates?

Todd, this is Paul. We are not -- actually we are seeing the reverse, just a lot of people -- again we’re pretty active with the market discussions quite a few sellers. And so we’re really not seeing a decline, it has actually picked up from over the last three months. Historically we’ve seen a pretty big lag between interest rate rises, this just doesn’t seem to -- that takes a while. In fact the idea that the owners have in their mind about their prices, what their properties worth, so I am not sure. Even though it was a pretty big jump and I am really glad we did our financing before it happened, the big jump hasn't translated into deal flow or pricing changes.

Okay, thank you. And some of your strongest markets like Texas, Florida, New York are also your largest markets, do you have a feel of what the supply picture looks like in some of the key areas where you are driving occupancies?

We’re seeing -- there is definitely an uptick in planning new developments. But in our last survey our markets we viewed about 30 properties within our trade area that is either have just opened or in construction or in the planning stage. And then in the markets in general it is about another 29 stores that we found. So close to 60, we’re seeing within that portfolio of new developments either planning or construction or just open. So again it’s really, generally it is not going to affect us in the foreseeable future.

Okay. Just as a reminder, how long would it take for a property that's newly developed to get to a stabilized occupancy. What kind of runway are they looking like?

In probably third party deals that we have looked at, that we will be managing, we are projecting or the donors are projecting a four years stabilization.

Okay. Thank you.

Thank you. Our next question comes from the line of Ki Bin Kim who is with SunTrust. Please proceed with your question.

Thanks a lot. Just a couple of quick follow ups. On development, surprisingly you want to talk about third parties, why not take it on yourself that you can handle the dilution given your capital equation, what other of your processes are teaming up with a partner.

You’re right. The dilution, I am doing a few would be negligible, but I think it is more the idea that we want to make, if we do this it would be with a guy that has local market expertise, guys that have been right there on the ground. When we say potential developer, we’re not talking about guys who are getting into this because they hear it is a good business, it is people who have experience in both the construction of site price selection, working it through the zoning and entitlement process. So it’s a whole load of things that we -- we know the storage business, I am not sure we know the storage development business and to ramp up, to do that would be on the scale we would do it on our own would be probably foolish. So -- but a lot of it has to do with market knowledge and market context.

Okay. And maybe from earlier say but once you had this business running what would the ideal or maybe kind of minimum run rate we should expect development?

For us it is basically JV and then…

Yeah.

It will be pretty minimum. It is not a game, we have always been -- for 30 years we said we are not really comfortable with the risk reward ratio on development. And as Paul just mentioned four years and I think recent experience with even very good developers and mainly in times have been worse than that. We still think there is a lot more pop we can get from stores that we have and established and well built and grow those from say 80 or 85 then we would, from 0 to 80. However it’s just not our bet.

Okay. And I guess the bigger comparison, how forward is that development with DSA and commodity offers coming back on line, still minimal in comparison to stock, but is that potentially growing. Does that, if it starts to become a bigger issues, however, incrementally for the sector how does that change your view on portfolio quality because most of the soft store operators haven’t really sold any, whether it be in bad markets, good markets, even accumulated but if it doesn’t become a bigger issue especially in a market that where you can’t go without secondary [pressure] market how does that change your view on maybe pruning the portfolio and getting out -- longer term more exposed to completing supply?

You know we look at all of our stores every year and we have sold about 30 stores or little less not this year but over the last 3-4 years. There is a few more, but in markets with a million people the overall market not the trade area, markets with a million people and I could, your store is located in a good 5 mile range. I don't think your threat of new competition is as bad as you might be thinking. You know you got a good store in good location, a decent sized market, you are going to be fine especially if you have a platform that we have. So, don't -- and then again we thought the early 2000 there were some 3000-4000 properties per year being built on a smaller base, on a base of about 40,000 existing facilities, the path was growing by 10% a year. We were talking 60 in our trade area probably a couple 100 nationally. I think even 500 to 1000 especially at this point in time per year for the next couple of years wouldn’t impact most markets. So down the road five years from now if everybody decides the only place to go is Self Storage and they are getting out of apartments and out of centered building maybe then that is the turning point. I think that is a long way out but I think you know we learnt we don't want to be in small path but the moderate sized towns, you got a million people in the town, you fill the couple of facilities in that part, is not going to hurt, (inaudible) the one that are our top volumes.

Okay, thanks Dave.

Thank you. Our next question is a follow-up from Todd Thomas with KeyBanc Capital Markets. Please proceed with your question.

Hi, thanks. Just a couple of quick follow-ups, I was wondering on the Morningstar portfolio if you could just give us a sense of what the price tag looks like, whether it is a $200 million portfolio or $400 million or $500 million portfolio?

Hi, Todd this is Paul again. If we just from guidance we have heard we expect it to transact some around 300 million.

Okay. And then just a follow-up. You had mentioned that rates at the end of July were 11.48 and that compared to 10.63 at the end of July in 2012. Were those street rates and if so are you able to provide what the rent per occupied square foot rates were at the end of July 2013 versus 2012?

Both our asking rates do not have the collective rents as of this morning.

Would the spread be somewhat comparable though or should we -- would we expect that to be a little bit more narrow?

It would be more narrow.

It would be, okay. Alright, great. That’s all. Thank you.

You are welcome.

Thank you. Mr. Rogers there are no further questions at this time. I would like to turn the floor back over to you for closing comments.

Thank you, Melissa and thanks everyone on the call for your support. We look forward to a good summer and talking to you in (inaudible). Take care.

Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.