CubeSmart Reports 4.4% Revenue Growth to $273M in Q1 2025, Net Income Declines

CubeSmart reported its financial results for the first quarter of 2025, revealing total revenues of $273.0 million, a 4.4% increase from $261.4 million in the same period last year. The growth was primarily driven by additional revenues from newly acquired and opened stores. Rental income rose to $232.8 million, up from $225.2 million, while other property-related income also saw an increase, reaching $29.8 million compared to $26.3 million in the prior year. However, net income attributable to the company decreased to $89.2 million, down from $94.5 million, reflecting a decline in profitability.

Operating expenses for the quarter increased to $158.2 million, up from $143.4 million in the previous year, largely due to higher property operating expenses and increased depreciation and amortization costs associated with new acquisitions. Property operating expenses rose to $82.9 million from $77.0 million, while depreciation and amortization increased to $59.2 million from $50.7 million. The company's interest expense also grew, totaling $26.1 million compared to $22.9 million in the prior year, attributed to a higher average outstanding debt balance and increased interest rates.

In terms of strategic developments, CubeSmart completed the acquisition of the remaining 80% ownership interest in HVP IV, a real estate venture that owns 28 self-storage facilities, for $452.8 million. This acquisition, which included the repayment of $44.4 million in existing debt, has expanded CubeSmart's portfolio significantly. As of March 31, 2025, the company owned or partially owned 659 self-storage properties, an increase from 631 properties at the end of 2024. The company also managed 869 stores for third parties, bringing the total number of stores owned and managed to 1,528.

Operationally, CubeSmart reported a slight decrease in average occupancy rates, which fell to 89.5% from 90.0% year-over-year. The company continues to focus on maximizing internal growth opportunities while selectively pursuing targeted acquisitions and developments. The outlook for the remainder of 2025 includes expected recurring capital expenditures of approximately $10 million to $15 million and planned capital improvements of $9 million to $14 million. The company remains committed to maintaining its REIT status and distributing at least 90% of its taxable income to shareholders, which is essential for its liquidity and operational strategy.