Clint Halverson - VP, IR Spencer Kirk - CEO Scott Stubbs - EVP and CFO

Christy McElroy - Citigroup Todd Thomas - KeyBanc Capital Markets Dave Bragg - Green Street Advisors Ki Bin Kim - SunTrust Robinson Humphrey Ross Nussbaum - UBS RJ Milligan - Raymond James & Associates Michael Salinksky - RBC Capital Markets Todd Stender - Wells Fargo Securities Tayo Okusanya - Jefferies & Company Paula Poskon - Robert W. Baird Jeremy Metz - UBS

Thanks Philip. Welcome everyone to Extra Space Storage's fourth quarter 2013 conference call.

In addition to our press release, we've also furnished unaudited supplemental financial information that’s available on our website. Please remember that management's prepared remarks and answers to your questions may contain forward-looking statements as defined in the Private Securities Litigation Reform Act.

Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the Company’s business. These forward-looking statements are qualified by the cautionary statements contained in the Company’s latest filings with the SEC, which we encourage our listeners to review.

Forward-looking statements represent management’s estimates as of today, Friday, February 21, 2014. The Company assumes no obligation to revise or update any forward-looking statements because of the changing market conditions or other circumstances after the date of this conference call.

With that, I’d now like to turn the call over to Spencer Kirk, Chief Executive Officer.

Good afternoon everyone. During the fourth quarter we saw same-store revenue increase 6.6% and NOI increase 8.9%, occupancy ended the year at 89.2%.

2013 was an outstanding year for Extra Space. We saw a record high occupancies, lower discounts and excellent expense control which combined to drive a 10% NOI increase for the year.

This was our second straight year of 10% NOI growth. At the end of the fourth quarter Karl Haas retired as our Chief Operating Officer.

Karl will continue to consult with the Company through the end of the first quarter at which time we expect him to join our Board. We’re excited to have Karl’s successor Samrat Sondhi take over field operations.

Many of you have met Samrat and know that he is the right man for the job. Samrat has been with the Company for almost a decade and his successes include architecting our revenue management system and leading our field operations in Chicago, New York and Los Angeles.

Extra Space is positioned to have a strong 2014. We see continued organic growth and a favorable environment for acquisitions.

This is evidenced by the 304 million either purchased or under contract so far this year. Fundamentals remain strong and there continues to be limited new supply.

That has become even more evident that smaller operators are struggling to keep up with more sophisticated operators online, especially when it comes to acquiring customers through mobile devices. We’re capitalizing on these market conditions by remaining focused on the fundamentals of our business.

We continue to innovate and to push ourselves. In short, we’re striving to be the best at getting better.

I’d now like to turn the time over to Scott.

Thanks Spence. Last night we reported FFO of $0.52 per share for the fourth quarter, which includes $0.01 of non-cash interest expense related to our exchangeable notes and $0.04 of acquisition related cost.

Adjusted for these items FFO was $0.57 per share for the quarter and $2.12 for the year. We had a very strong quarter for acquisitions.

We purchased 50 assets for 310 million. 19 of these properties came from an existing joint venture where we purchased all but 1% of our partner’s interest, which enabled us to avoid loan assumption fees.

Once the debt is repaid we will acquire the remaining 1% at a pre-negotiated price. For the year we purchased 78 assets for 586 million.

So far in 2014 we have closed on 18 properties for 214 million, 17 of these properties are from a single portfolio in Virginia and the other property is in Texas. As of today, we have an additional 8 properties under contract for 90 million which should all close by the end of April.

We continue to have great success in our third-party management program. We ended the year at 250 properties under management, an increase of almost 40% for the year.

We have established our full year 2014 FFO guidance to be from $2.32 to $2.41 per share, these estimates include non-cash, cash interest expense and acquisition related costs. When adjusted for these items FFO is estimated to be from $2.38 to $2.47 for the full year.

I’ll now turn the time back to Spencer for some additional comments.

Thanks Scott. We are coming off two years of superior results, and are heading into what we see to be a great year.

Our forecasted double-digit FFO growth is quite remarkable. The fact that a real-estate Company is able to produce this level of earnings growth is definitely noteworthy.

We expect storage to be amongst the best performing sectors in the REIT land in 2014. Let me reiterate that our focus for 2014 is the operational excellence of this Company.

We’re making long-term investments that will continue to give Extra Space the technological advantage to produce best-in-class results. I’ll now turn the time over to Clint to start the Q&A session.

Thanks Spencer. As in the past in order to ensure we have adequate time to address everyone’s questions, I’d ask that everyone keep your initial questions brief and if possible limited to two.

If time allows we’ll address follow-on questions once everyone has had an opportunity to ask their initial questions. With that, I’ll turn it over to Phillip to start our Q&A session.

Hi. Good morning to you guys.

Hi, Christy.

I just wanted to talk about your acquisitions forecast for 2014 and sort of how it relates to guidance. It looks like much of that is expected to be funded with debt given the rise in interest cost that you expect and no change to shares outstanding.

Is it your plan to sort of revisit permanent refinancing at the time you do the deals or later in the year. Or do you feel like you have some room for leverage to move higher here?

I'm just wondering if you do the full 500 million where does that put your leverage at year-end?

Yes a couple of things Christy, a couple of things to consider here. One is, we had a considerable amount of cash at the end of the year, obviously that went towards buying the Virginia portfolio and that was raised by issuing equity in November.

So, part of that share count is already in our year-end number. In addition to that, our annual share count for 2014 assumes a slight increase of call it $50 million, there could be potentially some OP or some additional equity.

So the remainder should be funded with debt and it shouldn’t increase our leverage significantly because if you think about our properties increasing, obviously that naturally de-levers this, so we feel like we should be able to do it on a fairly leveraged neutral basis.

Okay. And sort of given your progress so far this year, and your confidence in doing another 200 million, I am wondering if you could comment on the opportunities that exist for acquisitions today, what kind of pricing are you seeing out there.

And why do you think there is a greater willingness for private storage owners to sell versus, say a year ago. Do you think it’s pricing or do you think it’s the ability to compete, or both?

I think from a seller’s perspective they are seeing fairly attractive cap rates, from a buyer’s perspective in theory our cost of capital ticked up over the last 60 or 90 days with interest rates going up. So, it will be interesting to see what happens this year while buyer’s expectations are going to be such that they expect to pay less and sellers are still thinking about last year’s cap rates.

We’re still…

Do you think it’s more pricing related than sort of a change in their expectations as far as running their business?

It’s probably a combination of both but it’s really difficult to pinpoint one or the other.

Okay. And then just lastly on the addition of the 99 properties to the same-store pool in 2014, what impact do you expect that would have on your projected same-store metrics, kind of hard to just tell from the numbers.

But I know the last couple of years you have had a modestly positive impact. I am not sure what this mix of assets will do?

Yes, the 99 properties effectively consist of 90 assets that were purchased in 2012 and then all but one of our development assets, so they actually add about 50 basis points if you look at the change in same-store pool for the year.

To both revenue and NOI?

Great, it's top-line revenue is what I'm talking about.

Okay, thank you.

Hi, thanks. Good morning out there.

Just first question, just following up on Christy’s question with investments, I am just curious how you would describe the Company’s appetite here, so you set 500 million for the year with roughly another 200 million remaining assuming you close on everything that’s under contract, but how aggressive is the Company and are you seeing good product available by third-parties out there. How is the quality of what you're seeing relative to what you were seeing maybe a year ago?

Todd, it is Spencer. The quality is decent, to maybe add a little more color, pricing is the factor driving this.

I think there is a growing awareness that it’s becoming more difficult to compete in the world of acquiring customers online particularly as more and more customers migrate to mobile devices. And for us we are going to remain disciplined, we are going to do accretive deals.

It’s interesting to note that of the acquisitions that we did last year, the majority were kind of off market deals where we maximized our relationships and tried to do deals that were in the best interest of this Company. And so the strategy for 2014, Todd, is the same as last year.

We are going to participate in the open market. We are going to participate in the off-market and I think we are going to have a good year that produces decent result for our shareholders.

Okay. And then second question was regarding your development property, so most of the properties that you developed during the last cycle that were delivered, I guess between ’08 and ’11 are doing well.

Maybe a few more are still to stabilize here, but if we look back and say, the 128 million of new properties that was completed in ’09, the 83 million NOI, do you have aggregate yields for each year, each year is sort of completions, are you able to share that data with us?

The best information that we have right now, that’s out there is in our supplementals. So I would point you to those it breaks it down by year and so you can see the most recent three months NOI and annualize that and take a yield on cost or take the last 12 months NOI.

And then take a look at the growth rate I mean clearly they are continuing to finalize the lease up and stabilize.

Right, well I guess so, I’m wondering though. So the last data that you have in the supplement this quarter for 2010 completions and so on a trailing basis that yield comes out to just under 7% and that doesn’t include tenant reinsurance income.

And the yield on the 2011 deliveries in just two years in the lease up is over 5%. And so and say 3 years you get to say 7%, I am guessing there is another 100 basis points of upside there in the fourth year.

And I guess I am just wondering how you think about those yields today with acquisition yields where they’re at and why that wouldn’t be compelling? Why we’re not seeing a lot of new development started not just from EXR but from others?

I think development is coming, Todd. I think that there is still somewhat of scarcity of land.

I think land is still pretty expensive so it’s difficult to see things pencil. We have developments brought it us all the time by potential joint venture partners, so we see a lot of that and it’s still pretty difficult.

As we look at developments when we used to develop and we’re active developers, we wanted to get 300 basis points over what things are trading for. So if it trades for 6.5, we would want to develop to 9.5.

We’re not in the development business right now, so it’s difficult to speak to what we would do today.

And when you say a 300 basis point spread, I mean what’s the lease up timeframe you would typically underwrite to?

36 to 48 months is pretty typical. I mean what we’re seeing today with the lack of new supply is things are leasing up at the low-end of that.

We’re seeing things lease up in 24 months. We had one that opened in California that leased up very quickly, within a couple of years.

But obviously things are cyclical and things are really good right now. Two years from now when things are coming out of the ground, you could see a lot of new supply which obviously is going to affect the lease up of those properties.

Okay, great. Thank you.

Thanks, Todd.

Hey, thank you. Good morning.

Just following up on Christy’s question, what is impact of the 99 additional properties to same-store pool on expense growth in ’14?

It’s very similar to the old pool.

Okay, really no intact?

Yes, that’s flat correct.

And second question is on the disparity between the tenant reinsurance income and expense during the quarter. Can you explain that?

Yes, you had Sandy hit in the fall of 2012, so you had elevated expenses in that time period. I mean, tenant insurance has been great for the Company but when you have an event such as that, obviously there’s a cost to having that insurance business.

Got it. Thank you.

Thank you.

Thanks. So if I look at your 7% same-store NOI guidance for 2014, and compare it to what you guys came out of the gate with last year at 5.5% and object obviously in 2013 you did 10%.

I wouldn’t categorize this year’s guidance as really conservative, but given the tough comps and given that we’re not in the spring leasing season yet, so you don’t really know exactly what you can push rates to, to what level, what are you seeing Spencer on the ground to come up with, I would say, a little bit more bullish guidance than the market probably expected?

What I can tell you about the guidance Ki Bin, is we have done our best job to accurately and appropriately forecast what we think we can do in 2014. We have been working to maintain occupancy even at the low point of seasonality and we’ve done a great job of that and I think we’re well positioned as we come into the busy season to push street rates and to drive the optimal result.

But six weeks into the year it’s a little early to prognosticate of what the rest of the year’s going to look like and we stand by our guidance. We think it’s accurate.

We think it’s appropriate.

Yes, the other thing I would add to that Ki Bin, is we did things pretty similar this year to what we’ve done in the past and that’s bottom’s up budgets. And I think we underestimated the past couple of years the effect of no new supply as well as the effect of the Internet and we’re coming up against some tough comps so clearly we’re not expecting 10 plus percent NOI growth.

How much occupancy is embedded in that guidance? How much occupancy gains are embedded?

100 basis points, it’s called 100 to 200, earlier in the year it’s closer to 200, ending the year, closer to an average of 100 basis points.

Yes.

Okay. And just last question on the -- if I get PSA, it seems they won about 100 million of acquisition this quarter, I was wondering, were you guys an active participant in that process?

Absolutely, we’re out in the open market. I can’t say that we bid on everything that they bid on.

What we have done as I mentioned just a few moments ago is about two-thirds of what we actually closed on Ki Bin, came out of the existing relationship and they were not marketed deals. And I think every REIT storage REIT is going to participate in the broadly marketed deals to their best of their ability to underwrite or express an interest.

And I think there will be for all of us some relationships that are unique, where we capitalize on something that existed that tilts it in our favor. So we’ll have to see how it plays out.

But yes, there is a lot of competition for the broadly marketed assets and we’re all trying to maximize our relationships.

Did you get to the final rounds on that deal?

When you say on that deal, which deal, specific deal are you referring to?

Well I guess I was looking at it in totality, but I guess the biggest chunk of that 800 million.

Sometimes we’re the high bidders, sometimes we’re in the middle of a pack, sometimes we’re low and I could say the same thing for any of the other three storage REITS. It’s really interesting.

I don’t think anyone of us is consistently getting the deal. It seems to be passed around and it depends on the operational footprint and the assumptions and the underwriting.

Okay, thank you guys.

Thank you.

Thank you.

Hey, guys. Good morning.

Hey, Ross.

Hey, Ross.

Two different questions for you, the first is when I look at your realized rent growth year-over-year in the fourth quarter, compare that to what it had been running year-over-year in both 2Q and 3Q. It ticks down a little bit, and I am just curious is that a reflection that you backed off a little bit on rate growth to preserve occupancy in the fourth quarter?

And if so why was that?

So you have headed exactly right Ross. We kept things flat, maybe slightly down.

We knew we were coming into that slow season we wanted to preserve occupancy and I think that positions us very well coming into the busy season to be able to push rates.

Was it -- I mean should I interpret it to say that the occupancy line wasn’t cooperating as much as you had thought or you just wanted to be conservative to protect as much occupancy as you could there?

The latter, be conservative and preserve the occupancy.

Okay. Second question I had was a geographic one, when I look at your city MSA splits.

New York, New Jersey and DC Baltimore regions in the fourth quarter looked to be, I don’t want to say weaker because they were still good, right, but not as strong as some of your other major markets. Can you comment a little bit on what was going on in New York and DC that caused those to be underperforming the portfolio?

Yes Ross I mean Washington DC for instance has had two to three years of phenomenal growth. We would interpret it as somewhat as taking a breather both New York City as well as Washington DC you have had two to three years of being at the top of the portfolio list and now at some point maybe to move down and take a breather.

Is it supply related at all in New York? I mean or do you just think it is tough comps?

I would tell you it is tough comps. We have not seen supply effect us that much even where we have had sites open right next door.

Yes one other thing Ross, you are also looking at the impact of super storm Sandy in 2012 and that needs to be factored in.

That’s a fair pint Spence. Thank you.

Thanks.

Thanks.

Good afternoon and good morning. Curios, just a follow-up on the acquisition guidance of 500 million you guys already have done 300 in the first month and a half here of the year.

Is there something other than maybe more competitive pricing that leads you to think that there is going to be a slowdown in acquisition activity or would you say that’s being conservative just given the lack of visibility, any comments on that?

We would tell you the 500 million is what we feel comfortable we can do. If you look at the timeframe it takes to close some of the deals.

I mean for instance the 200 million that we closed in January we had under contract for several months before that it just takes 50 to 90 days to close a portfolio, right now we don’t have any major portfolios, it’s more one-off deals that we’re looking at.

Okay. And I am assuming the, moving to the expense guidance or at least included in the same-store NOI guidance that the snow removal costs in 1Q have been factored in.

Any comments on what you are seeing there?

We’re seeing our snow removal cost coming over budget obviously in the Northeast and then -- they are over our budgets and they are also significantly over last year. But they are all factored into our guidance.

Alright, thanks guys.

Thank you.

Good afternoon guys. Going back to same-store guidance for a minute, you gave us I think 100 to 200 basis points you said occupancy upside.

Can you walk us to the other components how much is discounting existing customer rate increases, tenant reinsurance? And then on the expense side, what’s the big drivers there, is it pretty much real estate taxes, personnel?

What’s driving the expense growth?

Yes on the revenue side, you got 100 to 200 basis points in occupancy, you have got maybe 50 basis points in discounts and then the reality is the rest is going to need to come from street rates primarily. I mean street rates are going to be a big driver of growth this year.

On the expense side about two-thirds of our expenses come from either payroll or property taxes, payroll is growing at slightly over 3% with our healthcare cost going up slightly as we move towards the Affordable Care Act and have more participation on our healthcare plan. And then in addition our property taxes are going up over 4% which account for about a third of it.

Okay, that’s helpful. Then this is my follow-up question, Spencer, at NAREIT you talked about ramping up redevelopment in 2014, can you kind of talk about the plan and the kind of returns you expect, just give us a little bit more color on that?

So, the REIT development of our assets Mike is only directed at keeping our product development in the market. And you can have a 30 year old asset that’s very well located on the corner of main and main, but if it looks tired and frumpy it’s probably not going to be as competitive in the coming decade as some new supply comes online, so we simply said, we’re investing for relevancy we’re going to spruce up properties we’re going to put in new offices, make it more retail oriented, may add some plan to control in certain markets and in general make sure that our property is geared for what the customer is asking for.

Some of the returns on this are easily quantified, others are more qualitative. And for us we think that looking at a dozen or two dozen properties in 2014 for redevelopment and keeping them fresh and appropriate for the market, that is coming as some supply emerges over the next four or five-six years is the right thing to do and it’s going to be an ongoing program, it’s not a one-time event, you’ll see us continue to look at our portfolio and in the best markets.

And really what I’m saying here is, looking at rent per square foot we’re more likely to invest in those markets first and then let it trickle down as the years roll by into the secondary markets.

Okay. Could you give a sense about how much you're expecting to spend in ’14 and how that compares to ’13 so you can kind of just see the trajectory?

Depending a little bit on how quickly we can get things ramped up. We would say $25 million to $40 million.

Okay, thank you.

Thanks, Mike.

Hi. Good morning, guys.

Hi Todd. Good morning.

Scott, you used OP units in the past, most notably with the all aboard transaction. Just wanted to get a feel of how much sellers are willing to take OP units in this environment and just how the original decision to increase the dividend so much to entice sellers to take OP units is kind of playing out?

I think it depends on the individual the deal we did in January was a non-OP unit deal so it depends on the tax situation somewhat typically if they have a really low basis, they’re much more interested in OP units. To raise the dividend we looked at trying to help people potentially maintain their cash-on-cash yield, we’ve had some success obviously, we have closed a couple of deals and we’ll continue to use OP units but at the same time, we’re probably more focused on making sure that we pay the right price for the assets.

Yes the only color I’d add to that Todd, because I’ve been involved in a number of discussions, when you go meet with a seller, what you want to do is be flexible and be able to offer up something that will cause them to want to sell, and it might be cash, it might be cash in stock, it might be a common OP unit, it might be a preferred OP unit. What we’re doing is using number of arrows out of the quiver to hopefully hit the sweet spot, the bulls eye and be able to transact in the fashion that accommodates the seller’s need while making sure that it’s an accretive profitable transaction of Extra Space and it’s been a good thing, it certainly has not hurt us.

It’s not going to solve every equation when it comes to the acquisition environment but it’s certainly is something that has proved to be beneficial in getting a few deals done that perhaps might not have gotten done otherwise.

Okay, that's helpful. Thank you.

And what are -- if you could just share some of the metrics that you're doing on current deals really how you're looking at your underwriting, particularly the Virginia portfolio and the other assets that are under contract, just regarding growth rates, your IRR and any of the other assumptions that you do in your underwriting.

Yes, our assumptions have been pretty consistent over the years. We're primarily a cap rate buyer.

When we talk cap rates we talk a year one forward-looking cap rate. We typically will take a look at our properties in the area if we have properties in the area and underwrite them similar to how our properties are performing.

We try to be fairly conservative on the growth. We would rather be surprised on the positive side than miss our estimates, obviously.

We get tax quotes from a tax consultant and underwrite to a year one cap rate. We obviously will look at an IRR but the difficult thing with an IRR is it assumes an exit cap which depending on what exit cap rate you do you can really change your IRR.

Okay, thank you.

Thanks, Todd.

Hi. Yes.

Good afternoon, good morning over there. Just a couple of quick ones, back to the acquisition guidance of the 500 million, the 200 million balance you’re kind of left to do, how should we be thinking about how that happened this year, is it more back weighted, more pro rata.

It sounds like again it’s all one-off deals at this point you have baked into?

We basically assumed mid-quarter acquisition for the remaining three quarters of the year. So effectively we’ve taken what we have and assumed that it’s going to close between now and the middle of April and then the rest is all mid-quarter assumptions.

Okay, that’s helpful. And then 2014, we have the same-store revenue guidance just kind of curious what your expectations are for street rate in 2014?

Street rate, Tayo, 2014 we’re in a really good position right now, our occupancy has held might even just comment that January was a strong month for us and a good start to 2014. And as we come into the busy season I think we’re in a good position to push street rates and how far we can push them only time will tell.

But our predictive third generation revenue management system is in a really good position to show us what we can do in the market given 56 different variables that are feeding into it. And I remain optimistic as I said in my opening remarks that 2014 will be a great year for Extra Space it might not be a superior year but it will be a great year.

Could you in fact could you actually give us a sense of what’s baked into guidance in regards to street rates?

Our guidance for the year assumes rate stay relatively flat the first quarter and then increasing the, coming into summer months and into late summer. And then hopefully we maintain those rates through the fall with potentially drooping them moving in the off season again very similar to what we’ve done in the past.

In that past. Okay, alright.

Great. Thank you.

Thanks, Tayo.

Thanks. Good afternoon everyone.

Hi Paula.

A question on the JV acquisition, Scott, what is in your guidance for impact on management fee income?

So we have the income and the expense in there. I mean effectively you’re charging a management fee but it gets eliminated in consolidation.

So there is no really benefit on the revenue side and no expense on the cost side.

Okay, thanks. And then just a, I am sorry go ahead.

As you say, so effectively we’ve assumed the management fee has gone away.

Okay, but can you quantify what that number is for modeling purposes?

I don’t have that in front of me right now. We would have to put out in a later presentation or information in the market.

Okay. Thanks.

And then, Spencer, just following up on your January comments, where did occupancy end January?

I don’t feel comfortable commenting on that quite yet Paula.

Yes, part of the problem remember Paula is we have a change in same-store pool, so to give that it could cost some confusion but we would tell you occupancy held in January.

It was a good month.

Okay, thanks guys.

Thanks.

Thanks, Paula.

Thanks. Just a couple quick follow-ups here, why were street rates up in the fourth quarter?

Street rates in the fourth quarter were relatively flat, Ki Bin. We kept our rates relatively flat as part of our strategy to maintain occupancy and hopefully push them going into the busy season this year.

I’m sorry, flat, do you mean quarter-on-quarter or flat year-over-year?

Year-over-year, so if you compare October to October, November to November, and December to December.

Okay. And last question.

You had about -- you booked about $5.1 million of acquisition costs. You only closed about $310 million.

That represents about 1.6%. Is that -- seems high.

Could you comment on that? Is that 5.1 million fully dedicated or related to 310 million or were you looking at other deals that didn’t fall through?

No, it actually has about 1% relating to the acquisition cost and then you have about 2.5 million of diffidence in there. So our diffidence is actually in two lines on our income statement partly because of how we handle the diffidence and how for accounting purposes we had to treat that.

So in our acquisition costs there’s about $2.5 million of diffidence.

Okay that clears it up, thank you.

Thanks, Ki Bin.

Hey, this is Jeremy. Just had a quick two follow-ups, one just as you look at the existing JVs you have, what sort of opportunity is there to buy out more of those as you look forward?

Jeremy, it is Spencer. As you know part of the reason we have done third-party management JV is because ultimately we think they are good acquisition opportunities and historically that has proven to be the case where frequently we get the first and only call when the owner decides to transact.

Going forward it is very difficult for us to prognosticate when our partner, our JV partner may want to sell and we are not in a habit of going to our JV partners and saying hey you want to sell it, it's kind of going over to your neighbor and knocking on the door and say hey I'd like to buy your house. It's going to jack up the price and cause an unnatural transaction to take place.

And so what we have done is we've tried to be a good partner. We have maximized the results.

We know that we'll be in storage in perpetuity and we know that most of our JV partners at some point will be looking for liquidity. And when it's the good time and the appropriate time for them, we'll be ready to transact.

So we don’t model anything in and sometimes we end up with a very nice transaction that we possibly could not have forecast and that will continue to be the case. The only thing I can tell you is we have several billion dollars worth of properties held in joint venture relationships and we think we're in a really good position to capitalize when our partner decides to sell.

Okay, so you wait for them to really come to you on those?

Absolutely.

And then I know you are in the process of building a portfolio and not selling, but given the strong bid that's out there right now for storage have you put any thought into selling any of these weaker assets or markets where you just have very limited exposure, only a few assets and maybe not a stronghold there?

Yes, we do Jeremy. The short answer is -- in the weaker markets are the more thinly populated markets and I'm talking where we have just a few assets.

We look at it, we consider it two things. Number one we need to look at the financing that is on those assets and number two we have to look at the impact on our operations because we may have third-party management contracts in those markets and you don’t want to diminish your economies of scale.

So it sounds simple in rebalancing the portfolio and selling in those secondary and tertiary markets which we have a few of. But we take them on case-by-case basis and you've hit the nail on the head, we're building a Company and we're trying to expand our footprint and our reach not contracted.

So it's safe to assume there is none baked in the guidance either than?

That's correct.

Great, thank you.

Thanks Jeremy. Alright, it's Spencer.

We thank you for your interest in Extra Space today. We appreciate your time and we look forward to next quarter's call.

Have a good day.