Greetings, and welcome to the National Storage Affiliates' Third Quarter 2024 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, George Hoglund, Vice President of Investor Relations for National Storage Affiliates. Thank you, Mr. Hoglund. You may begin.

We'd like to thank you for joining us today for the third quarter 2024 Earnings Conference Call of National Storage Affiliates Trust. On the line with me here today are NSA's President and CEO, Dave Cramer; and CFO, Brandon Togashi. Following prepared remarks, management will accept questions from registered financial analysts. [Operator Instructions] In addition to the press release distributed yesterday afternoon, we furnished our supplemental package with additional detail on our results which may be found in the Investor Relations section on our website at nsastorage.com. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements that are subject to risks and uncertainties and represent management's estimates as of today, October 31, 2024. The company assumes no obligation to revise or update any forward-looking statements because of changing market conditions or other circumstances after the date of this conference call. The company cautions that actual results may differ materially from those projected in any forward-looking statement. For additional details concerning our forward-looking statements, please refer to our public filings with the SEC. We also encourage listeners to review the definitions and reconciliations of non-GAAP financial measures such as FFO, core FFO and net operating income contained in the supplemental information package available in the Investor Relations section on our website and in our SEC filings. I will now turn the call over to Dave.

Thanks, George, and thanks, everyone, for joining our call today. We are pleased to announce that all of our team members are safe following hurricane Helene and Milton. We hope that all affected by these storms remain safe and we wish the best as they work their way through this tough recovery period. While several of our facilities in the path of these storms experienced minor damage, largely impacting gates, roofs and signage, all of our stores are back open for business. Have experienced an uplift in occupancy on the West Coast of Florida, primarily in Tampa and the Sarasota-Bradenton area. In these markets where we have 25 stores, we've seen an increase in occupancy of approximately 600 basis points from Shortly before Hurricane Milton until today. An uplift in occupancy is helping to partially offset what remains a very competitive operating environment. Our Sunbelt markets and areas with elevated new supply continue to be more challenging for us. So far, we have not seen an impact to the housing market or customer demand levels as a result of the September rate cut by the Fed. Fee rates during the third quarter were down 17% from the prior year period and we expect that number to widen a bit in the near term as we seek to hold occupancy levels for the remainder of the year. I would add that we're pleased with the rental activity and occupancy levels in October. We estimate that the average occupancy in October will be down approximately 200 basis points year-over-year. Our existing customer base remains healthy and payment activity and length of stay, all remaining within our expectations. Despite this office and pricing to new customers, we continue to be pleased with the success of our ECRI program, and we have not experienced…

Thank you, Dave. Yesterday afternoon, we reported core FFO per share of $0.62 for the third quarter of 2024, representing a decrease of 7.5% over the prior year period, driven primarily by the decline in same-store NOI. For the quarter, revenues declined 3.5% on a same-store basis, driven by a 290 basis point year-over-year decline in average occupancy and a 90 basis point decline in rent revenue per square foot. Expense growth was 1.2% in the third quarter, with the main drivers of growth being property taxes and insurance, partially offset by declines in personnel and R&M. Now speaking to the balance sheet. Last month, we issued $350 million of private placement notes with a weighted average coupon of 5.6% and a weighted average maturity of 7.6 years. We were pleased to have priced the transaction in late August, taking advantage of a more favorable rate environment. The 10-year treasury yield is about 40 basis points higher today from where we priced the transaction. We used the proceeds to retire the $325 million Tranche C term loan that was due in January 2025. In July, we also paid off the $145 million Tranche B term loan that came due, bringing total debt paid off in the third quarter to $470 million. We have just $16 million of mortgage debt maturing for the remainder of 2024 and no maturities in 2025. Our current revolver balance is roughly $400 million giving us $550 million of availability. As Dave mentioned, we are evaluating more acquisition opportunities. And as accretive deals materialize, we will opportunistically seek to term out the balance on the line of credit to maintain ample capacity. We are comfortable with our leverage, which was 6.4 times net debt to EBITDA at quarter end. As discussed on our last call, as…

[Operator Instructions] Our first question comes from the line of Juan Sanabria with BMO Capital Markets. Please proceed.

Hi good morning. Brandon, maybe just following up on a comment you made there at the end with regards to guidance. The full year FFO guidance implies a sequential drop off versus what you reported in the third quarter. I just wanted to make sure that I understood that correctly. The midpoint is a good base off of which to work in that kind of $0.04 to $0.05 sequential deceleration is, in fact, kind of what you guys are pointing to.

Yes, Juan, thanks for the question. You're right. The implied midpoint or the midpoint of the guidance implies Q4 would be right around that $0.56 obviously a sequential decline from Q3. A couple of things about the third quarter numbers that had some onetime benefits. The joint venture deals that Dave described earlier, we did have roughly $800,000 in fees in the third quarter related to those fees and roughly $650,000 of that is onetime acquisition fees. Now one of those deals closed at the end of July, the other closed in mid-August. So we will have some ongoing fee recognition on a full quarter basis, that will be a benefit, but there was a onetime acquisition fee in there that's unique to the third quarter numbers. And then on the same-store OpEx, I would tell you, we did have some benefits and property taxes that are more onetime in nature. The comp in Q4 year-over-year gets a little tougher as well. And so that OpEx growth number year-over-year is expected to be higher in the fourth quarter versus the third quarter. So those are a couple of things that when you normalize for that, maybe you're at a $0.60 or $0.61 for the third quarter if you adjust those things out. And then the rest of that sequential decline that you're picking up on, frankly, is a seasonality in the business that we anticipate.

Great. And then in your prior presentations, you'd kind of had some updates on how some of the web traffic and conversions and relative occupancy differences between the corporate managed stores and PRO stores that were previously third-party managed now internally. So just curious if you can give an update on kind of how that's trending and potential upside thereof.

Yes, Juan, good question. Thanks for being on the call today. We've been really successful through this transition, and we started as we talked about in the Southwest with really the initial set of PRO stores that we moved over around that Phoenix, Las Vegas market, a little bit of Southern California. And so -- the work of the transition, if you think about it as we transition platforms and we transition team members and we train and teach and get systems live, really, we think, takes about 45 to 60 days before we really start to see some impact from that transition, and we really are able to start working on revenue management strategies and customer acquisition strategies. And so if you point back to that Southwest market, and look at a market like Phoenix or look at a market like Las Vegas, I can tell you early on, we're pleased with some of the progress we've made on two fronts. If you look at an occupancy gain around Phoenix and Las Vegas, they're probably 50 to 80 basis points better occupancy gain in the period of the third quarter than what our overall portfolio was. And so that's encouraging to us and the fact that as we put the customer acquisition strategies into the rate strategies and we did see a movement in rentals. And that's important as you think about revenue because that's what we're driving to. That is one of the legs we're working on. And then on the backside of that, we were also going through those early markets. Once you get in transition, get the team members done and all the platforms, then we're able to go back through the existing customer base and look at ECRIs and ask ourselves where that existing customer base was compared to where we thought we can move them not only on new move-ins going forward on the existing tenant base. And so we stepped back in, in the third quarter, scrub those early on transition stores that were past that 45, 60-day period, and we've implemented some pretty sizable increases around some of the tenants in magnitude and the quantity of rate increases back through that tenant base and we'll start to see the benefits of late third quarter, fourth quarter into 2025. And so we're pleased in the fact that we're able to do both those things, see a little bit of progress early on recognize that, obviously, digital footprint got better. Our positioning got stronger. Our paid search advertising got more effective as we use nsastorage.com. So a lot of positive things for us early. But we also know, as we pointed to earlier, it's really a 2025 view that we're looking at the back half of the year was really about the transition. Transition is going well. All these really green shoots coming in 2025.

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

Hi, thanks, good morning. Brandon, appreciate the detail as we think about the fourth quarter and sort of the midpoint that you kind of highlighted. But as it pertains to the internalization transaction, which closed on July 1, so we had just got a full period reflected in the financials this quarter. Is there anything that we need to think about related to the internalization transaction itself as we move into the fourth quarter and sort of early 2025 around G&A or some of the other income lines that we should be sort of considering?

Yes, Todd, thanks for the question. So -- what I would say is, remember, there's a couple of different pieces of the FFO accretion that we communicated on regarding the Pro internalization. One of those was the savings on G&A and the tenant insurance benefits, right? And that one, I think, is the most immediate one that one, you can see in the financials and two that were most immediately recognizing. So the tenant insurance benefit, we started to realize on July 1, you can see that primarily in our management fees and other revenue line item on our P&L. You can see that improvement over prior quarter and prior year. The G&A benefit, I would point you to our supplemental schedule 9, it breaks out our G&A expense line item from the P&L. And it shows labeled supervisory and administrative fees, that's the management fees that we pay the PROs. That number for the first two quarters averaged $5 million per quarter. And as you know from our last couple of touch points, we have entered into new agreements to have the PROs continue to manage the stores and do the accounting and other back-office things for the properties until we do the transitions that Dave just described. So you see that number go down from the $5 million previous run rate to $3.4 million in the third quarter, and that will continue to taper down as you go through the fourth quarter and then into next year. So we're -- the point is we're starting to realize some of that benefit, but it's not all captured yet in the third quarter numbers. By early 2025, we should see the full benefits of both the tenant insurance and the G&A on a run rate basis. The last thing I…

Okay. That's really helpful. And then in terms of the transaction environment, you -- obviously, you're putting some money to work and it sounds like the pipeline is building for acquisitions, but you've also talked about some additional capital recycling and dispositions. And I just wanted to see if you could provide an update as to where you're at on that process whether you started marketing additional assets for sale or have anything sort of under agreement at this time?

Yes. Good question, Todd. I'll start with is the overall transaction market, and then we'll work into how we're looking at dispositions and some selling of the assets. We have seen many, many deals across our desk. We're encouraged by the overall deal volume, the overall quality of the deals we're underwriting a variety of markets, a variety of size. I do believe now that we're a couple of years removed from the highs of COVID and sellers' expectations and our ability to underwrite forward-looking revenue numbers, all those things are starting to be clear for everyone and be more consistent for everyone. And so we're actually finding opportunities that we like in markets we like, and we're able to move on. And so that's encouraging from the acquisitions front. I think that continues. And we're -- like I say, we're encouraged and the team is working hard and underwriting a lot of deals. As we go through the transition of the PRO stores that was the one when we did the first set of really pruning the portfolio and selling of assets. We did not really dig into the PRO side of that transaction as far as the PRO stores and now that we're transitioning those stores as we transition markets, we are studying all points of the markets, the stores, the individual assets, our success in the markets, how we're positioned. We've already identified probably 15 to 20 assets that we think would be something that we might dispose of. I think you'll start to see us really in the fourth quarter and the beginning of next year, think about is this the right time to get them listed and start recycling the capital. Obviously, we think we have good opportunities in front of us. So selling the assets, recycling into better assets is really attractive to us. And we can use vehicles like 1031 exchanges to make some tax efficiencies there and some opportunities around that piece of it. So I would look for us over the next 3 to 6 months, you'll start seeing some activity on listing our properties and really over the next 6 to 9 months sale of properties. The heavy lift is over though. I would not I think we're net buyers going forward. If we're able to sell or recycle $100 million to $200 million of these assets over time, that's probably the number I can give you.

Okay, great. Thank you.

Thank you. Our next question comes from the line of Jeff Spector with Bank of America. Please proceed.

Great. Thank you. On the previous call, your peer discussed, not just stabilization but improvement and they said nationally. How would you characterize the current environment, your thoughts heading into 2025?

Good question. Thanks for joining today. It's interesting. I would tell you, we have a very diversified portfolio. And as you look at that and you look at markets and individual assets, I think there's a lot of ways to look at what's going on. If you look at markets today that we're a little more heavily exposed into the Sunbelt. We're a little more heavily exposed into single-family housing. And if you look at those markets and you look at their history, they had a great run during the pandemic, and they had some really outsized performance and now they have tough comps that they're up against, and they have elevated supply in a lot of those sunbelt markets like in Atlanta or Phoenix or Las Vegas -- those are going to remain challenged. You're going to have to work your way through the new supply, you're going to have to work our way through some of the fundamentals that have not returned because of transition around housing and so forth. We do have markets across the country that we have found putting in occupancy. We've found putting in rates. Our customer base remains very healthy. We're having really strong success around the ECRI program. And so as we get stability in occupancy, we get stability in rate that's encouraging to us. Maybe a market I would point you to is Portland, Oregon, which we've talked about for a number of years, we had a lot of supply and a lot of headwinds in front of it. And if you look at it, we've actually been able to stabilize that market fund a little bit of occupancy stability, find some rate stability and have a market while it still has a ways to go because of the growing to the supply, it is a positive sign to us that we found stability there. I would tell you, if you looked at our numbers, we knew the second quarter -- the spring leasing season was not as elongate as it normally was. It was shorter than historical. The third quarter was challenging, but we are pleased with in October. We talked about on the opening remarks about the spread, but I can give you a spot number in occupancy in October right now, as of yesterday, we're at about 85.8%, which is down 190 basis points the last year, but that is an improvement over September. And so for us, again, a lot of variety of markets, a lot of things at play here, but we were pleased to see the rental activity to move out volumes in October and then have an occupancy gain.

Okay. That's really helpful because I think last quarter, you did say that you weren't seeing normal seasonality patterns through the spring, but has that now returned this fall and you expect that to continue through the winter?

The October number kind of bucks the seasonality because typically, from a summer high, you really bleed occupancy down through really almost till February. I mean that's really the highs in June, July and August, and you get to your trough in February. But the occupancy -- the rental activity around October would be a little stronger was pleasing to us. And so that was an objective. We're certainly working on all the levers around rate and advertising and discounting and all the things we can do to try to attract customers. But again, it's market specific. There's a lot of factors to this, but we were pleased with the activity in October.

Thank you.

Thank you.

Our next question comes from the line of Michael Goldsmith with UBS. Please proceed.

Good afternoon. Thanks a lot for taking my question. It sounds like street rates were down 17% for the third quarter. You expect that to get a little bit worse as you look to close the October occupancy gap, I think in the third quarter, you're down 290 basis points. And now for October, you're looking to be closer to 200 basis points. So can you provide an update on kind of where street rates are for October? And like what does the path look like going forward as street rates probably get a little bit worse before they get better, but occupancy kind of getting better and how that sets you up for the spring leasing season. Thanks.

Yes, Michael, absolutely. Thanks for joining. I would tell you, you're right, we were down 17% in the third quarter. But if you really look at the third quarter, it started to widen from July through September. And so if we are maybe low to mid-teens in July, maybe we're in the low 20s by September. And so that path has continued into October. I think it's widened -- we're mid-20s in October today. And I think there's two things going on for us. So obviously, we're trying to find the right blend of rate and discount and marketing spend to get the amount of rental volume we wanted. And so October was a positive for us around that rental volume and we like that, but also with the PRO transition, we're going back through that portfolio, introducing our revenue management strategies and our marketing strategy and customer acquisition strategies. And we're repositioning some of those markets to be a little more competitive in their environment. And so I think some of that October movement, some of that September move, but it might be a little bit outsized as we work through that PRO portfolio and find our footing. As I mentioned earlier, with Phoenix and Las Vegas responding quite well to our new positioning, that's encouraging as well. But I don't -- I'm not sure how much wider they get from a year-over-year basis through the rest of the year. I think we've done a lot of the heavy work around street rates really the last three months -- and if we continue to see the activity we like on rentals, maybe we're not widening as much November and December.

Got it. So you see it as like this October is kind of like the trough and then for Street rates and it should kind of get better from there?

We're flat out. I mean the gap may flatten out, right? But yes, I think we've done a lot of work except there were October.

Got it. Thank you very much.

Thank you.

Thank you. Our next question comes from the line of Omotayo Okusanya with Deutsche Bank. Please proceed with your question.

Hi, good afternoon. I just wanted to follow up on the last question. Again, street rates down 20% year-over-year in October. It's kind of -- that's pretty wide, and I get it trying to get occupancy you can ultimately CRI those tenants. But when you just kind of think about how much you may be given away street rates wise, on a very near-term basis, how do you kind of offset that? Is that lower marketing? Is that -- I'm just kind of curious how you kind of offset such new street rates to ensure you're still kind of generating the level of ROI or profitability that you're looking for?

It's a good question. I think there's several pieces at play here. Certainly, what we can do around any type of efficiency operational to help offset that. I also think the occupancy gain in October is an important not to overlook. That is one of the things that helps us drive revenue. And so if we're looking at the street rate and trying to find a balance of right rental activity versus how the customer is coming in and what they're focused on. And I do believe the customer right now is very focused on price. Will that change over time? We believe so. But right now, price seems to be high on the list of one of the things that's triggering people to rent units when they're looking for units. And so the other thing I would tell you, Tayo, is we work really hard on the back end rate. I mean, so once you have them in the door, we're more sophisticated -- and we certainly have a better program than we've ever had, and we have a higher level of confidence that we can recover that entry rate quicker than we ever have in the past. And so I think we're trying to find that balance of asking rent, marketing spend, amount of customers we want in the portfolio within market, within property, right, you got to drill all the way down even to the unit size is what we're studying. But I think those things help us kind of offset that asking rent. The other thing I would also tell you, length of stays are long than they've ever been customer remains healthy. So getting a customer in the door today, we have a longer runway for the lifetime value of that customer.

That's helpful. And then from a pricing perspective, again, the publics are just about 15% of the overall market. Is the private side of the market doing anything different that could indicate that maybe strictly bottom a little bit faster or actually widening a little bit more than we may be anticipating? Or is the private side of the market pretty much just following what the public guys are doing still.

I think it's -- as you talk about the private sector, there's two parts to that. I think the larger private operators that have a little more sophistication are certainly following more of what the public groups are doing. And they're reacting in the same -- pretty quick and they were able to react up or down, by the way, all the way around that piece of it. The rest of the segment, though, that these larger, more sophisticated private operators are not doing anything. In most of our markets, and this happened all the way through COVID. They did not raise any type of rates through COVID. And so now everything has returned down to pre-COVID levels, they're back in this mix about the same level. And so that non-sophisticated operator just hasn't moved at all.

Helpful. Thank you.

Thank you.

Our next question comes from the line of Ronald Kamdem with Morgan Stanley. Please proceed.

Hey, I just want to just go back to sort of asking if the demand question in a different way. I guess I'm trying to figure out, as you're cutting street rates to get sort of more occupancy, more market share, are you doing that into an environment where top of the funnel demand is stabilizing, improving? Or like how would you characterize as the top of the funnel demand overall in regardless of sort of the strategy that you're pursuing?

Yes. Good question. I think the top of the funnel is probably -- I would characterize probably stabilizing. We're -- if you look at just anecdotally, our surveying and what we do around customers that have rented from us, in or out all the surveying we do, we are seeing a change in the fact that more people are saying they're renting storage units because they're moving. And that's an improvement that we've seen for the last few months. And so if you look at that in itself saying, okay, that's something that's been missing from our business and in our markets, particularly where we are a little more sensitive to that transition around movement, that's an encouraging sign for us. But we're not seeing that top of the funnel increase. We're not seeing -- if you think about web sessions or people are pinging us at the very top of that funnel, we're not seeing a significant change up or down. It's pretty been pretty stable. And so we're trying to by rate, of course, and by discount and by the things we're doing, we're trying to get a little bit more of that conversion rate up and take a few more of those customers.

Great. And then just my quick follow-up would just be on the on the expense side, is there sort of -- other than the usual sort of property taxes and insurance, is there anything that we should sort of be mindful of for sort of this quarter and going into next year? Thanks.

Ronald, this is Brandon. I mean, other than what I remarked on earlier, the comp gets a little tougher. We had some property tax benefits in the back part of last year. So the growth number, like I said earlier, we expect to be higher than what you saw in the third quarter from a year-over-year perspective. The only other thing I'd probably add to what we said earlier is just the personnel costs, Ronald, you see that in the numbers in the trailing five quarter information that we disclosed. There was some improvement, meaning lower spend in the third quarter over Q2. And I don't -- I wouldn't say that's necessarily like a great run rate. I do think that, that number will come back up a little bit. Some of that was attributable to these markets. The Phoenix is the Vegas at Southern California that we started to transition from the PROs. And we tried our best to hire as many of the people that we could that we're already working at those stores. But inevitably, you have some turnover there. And so that caused that personnel cost line item to be a little bit lower in the third quarter. So I expect that would pick up somewhere between the second quarter and third quarter numbers.

Great. That’s it for me. Thank you.

Thanks, Ronald.

Thank you. Our next question comes from the line of Salil Mehta with Green Street. Please proceed.

Hi guys, thanks for taking my question and congratulations on the quarter. I'd just like to quickly touch base here on the M&A activity and the acquisitions pipeline. It seems like common theme through other storage REITs in the industry as a whole has kind of started out slow in 2024 and slowly ramping up. Just wondering if you guys could provide some color on that and kind of where you guys expect which direction it did go into 2025.

Yes, sure. Thanks for joining. Appreciate the question. Yes, I think as we thought about this year, we did think the back half of the year will become more active than certainly the front part of the year. And I think it's because of the factors we discussed earlier. I think the sellers' expectation, buyers' expectations are getting closer and -- and I think we're seeing the quality of properties in the markets that we want to see come to market, and we're able to move on some of those. I think that continues on into 2025. I think we're just getting started. If you really look at even from July to what we're seeing today, there's been a significant change in the amount of deals, the amount of calls, the amount of things that are crossing our desk opportunities. And so I think that carries into 2025. I think obviously finding the right balance of what our return expectations are. And obviously, the more we get comfortable that fundamentals are going to improve and that we filed some stability around the fundamentals. It makes it easier for us to be forward-looking and want to acquire properties.

Awesome. Thanks for that. And just a specific question on the joint venture with Heitman kind of tying into M&A, but has it underwritten any opportunities in the last quarter? And do you think you'll start seeing assets getting added to this venture? And is development a thought for this as well?

Yes. So clearly, we've been looking at a lot of assets that would fit into that venture. And we think that's as one of a good access of good quality capital at a reasonable price and for us, capital light. So we like the venture. We want to continue to work in the venture and we're finding opportunities there. And from a development side, not really something we really want to look at in that venture. We want to look more there could be some opportunistic properties in there, but we're really looking for assets that we can -- are fairly seasoned that we can squeeze more juice out of it, and that's what we want to put in there.

Awesome. That’s it for me. Thanks guys.

Thank you.

Thank you. Our next question comes from the line of Brendan Lynch with Barclays. Please proceed.

Great. Thanks for taking my question. Dave, I think you just mentioned earlier that length of stays are longer than ever. Can you talk about what is driving that dynamic, how durable you think it is? And how you think about ECRIs in that context?

Sure. It's interesting. I think as we went through the pandemic, I think people got to introduce into storage for a variety of reasons. And I think if you think about the home office piece has not changed, people may be back in the office some, but they still have home offices and that has carried its way through I still think home gyms have pared their way through. People clean out garages, did a lot of things during that period of time that have been sticky. And I also think we introduced customers that have never used self-storage because of that to self-storage, and they've realized that it's convenient fairly inexpensive, and it's just a really good use of space, time and money for them. And so I think that's led this long length of stay. And it's above pre-pandemic levels. We have not seen a change in the last -- we've just not seen a change at all. I mean it elevated in levels, maybe it came off a little bit from the highs of the pandemic levels, but well above pre-pandemic. And so what that does, it gives us an opportunity to look at our ECI program in the frequency. We call it life cycle and the customer life cycle of the amount of times we that person in the life cycle. And so when we have our same-store tenant base right now, the length of stay for the current tenant base is over 40 months, you think about the opportunities and the touch times we have for ECRI opportunities in a 40-month period. I think helps us with our conviction around the ECRIs. But certainly, we've done a better job building better systems, building our technologies and our strategies to really maximize that length of stay better than we have before.

That's helpful. And then you also mentioned that customers are very focused on rate. The economy is reasonably strong at present. So what is going to make them less sensitive and kind of how has that transitioned over time, that level of sensitivity, I'd imagine there's more risk to the downside that they get more sensitive rather than less going forward. But I would be interested in your thoughts there.

It's a good question. We thought about it a little bit. In some ways, I think we did it to ourselves. I think discounting was the more probably predominantly use things prior to the pandemic, where you're giving a first month free or three months free. And I think we haven't introduced as much as the discounting back. It's still the same concession, right? You're still giving up percentage of the rent throughout the piece. But I think what has come back after pandemic has just been more of a sharp entry price and then you're using the ECI to back it up on the back side of that, right? So maybe just a little bit difference in strategy. But I think does change going forward is I do think as fundamentals improve supply things ease some of this transition that's gone on, the industry eases. I don't think it's going to be as competitive to attract new customers as it was maybe over the last 12 to 18 months. And so maybe as we all get more comfortable with our levels and we get more comfortable and where our footing is we get some strength in street rates. And then I think that the consumer kind of follows what we give them, right? I mean we've been pretty aggressive in our steerage, and I think they're just reacting to it.

Great. Thanks guys.

Thank you.

Thank you. There are no further questions at this time. I'd like to pass the call back over to George for closing comments.

Thank you all for joining the call today, and we -- and your continued interest in NSA. We look forward to seeing many of you at the REIT World Conference next month, and have a happy Halloween.

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