Smart Stop Self Storage REIT Reports Strong Q4 2025 Results

In its fourth quarter earnings call for 2025, Smart Stop Self Storage REIT showcased a commendable performance despite facing headwinds in some markets. The company reported a same-store revenue growth of 0.4% alongside an average occupancy rate of 92.3%. Notably, the call highlighted a competitive pricing environment and challenges in certain markets, particularly Asheville, which impacted overall performance. However, Smart Stop's strategic initiatives and robust guidance for 2026 provide a strong foundation for future growth.

Financial Performance

Smart Stop Self Storage REIT reported a Funds From Operations (FFO) as adjusted per share of $0.55, marking a 29.8% increase year-over-year. For the full year, FFO as adjusted per share reached $1.87, reflecting a 10% growth from 2024. The company's same-store revenue growth for the entire year stood at 1.6%, with an average occupancy of 92.5%.

Key Highlights:

• Q4 Same-store Revenue Growth: 0.4% (40 basis points)
• Average Occupancy Rate: 92.3%
• FFO per Share (Q4): $0.55 (up 29.8% YoY)
• FFO per Share (Full Year): $1.87 (up 10% YoY)

Despite a competitive pricing environment that resulted in higher move-outs in certain areas, Smart Stop's operational metrics remained strong, with ten of its top fifteen markets posting positive revenue growth. Management noted the outperformance in areas such as the recently acquired third-party management platform and favorable operating expenses.

Strategic Initiatives

The company has been proactive in its growth strategy, completing $369 million in acquisitions throughout 2025, including a Class A operating property in Orlando and a parcel of land in Canada for development. Additionally, the acquisition of Argus Professional Storage Management significantly bolstered the company's operational capabilities, adding over 220 managed properties and 400 employees to its team.

Notable Developments:

• Acquisitions in 2025: Totaled $369 million
• New Property in Orlando: Acquired a Class A operating property
• Argus Acquisition: Enhanced management capabilities with 221 properties and 400 employees
• Managed REITs: Assets under management exceeded $1 billion, with robust growth in fees

The company also emphasized its focus on technology investments, particularly in artificial intelligence, to enhance operational efficiencies and customer service. Smart Stop is aiming to expand its third-party management business in both the U.S. and Canada, which presents substantial growth opportunities moving forward.

Future Outlook

Looking ahead, Smart Stop provided guidance for 2026, projecting same-store revenue growth between -0.5% to +2% and NOI growth from -1.8% to +1%. The anticipated FFO as adjusted per share ranges from $1.93 to $2.05, indicating an approximate 6% growth at the midpoint of the guidance. Management remains optimistic about the recoveries in the self-storage market, despite recognizing ongoing uncertainties in the broader economic environment.

Key Guidance for 2026:

• Same-store Revenue Growth: -0.5% to +2%
• NOI Growth: -1.8% to +1%
• FFO per Share Guidance: $1.93 to $2.05
• Capital Deployment: Expected between $72 to $96 million

Smart Stop's management highlighted the importance of disciplined capital allocation, targeting acquisitions, bridge lending, and development projects within their Smart Centers joint venture. The company also plans to invest in solar initiatives and continue expanding its third-party management business.

Conclusion

Smart Stop Self Storage REIT's fourth quarter earnings call demonstrated a solid performance amid a challenging market landscape. The company's strategic initiatives, including key acquisitions and a focus on technology, position it well for future growth. With a robust guidance for 2026 and a commitment to disciplined capital allocation, Smart Stop is poised to navigate the self-storage sector's recovery effectively. As the company continues to optimize its operations, investors can look forward to potential growth opportunities both in the U.S. and Canada.

Overall, Smart Stop's achievements over the past year have laid a strong foundation for future success, making it an intriguing player in the self-storage market as it heads into 2026.