Kirk: Extra Space Storage has three distinct advantages that drive our operational outperformance:
Our people: Our senior management team has worked together for more than a decade, so we're well-versed on the company and the industry trends. We also hire exceptional team members at the store level. With each customer having a lifetime value to the company of approximately $1,500, it's vital that we close every deal. We hire and train only the best.
Our properties: We have more properties in the top 20 metro areas than any of our competitors. Because we're in larger markets, we attract customers with higher median household incomes. Our properties in these markets are high-quality and extremely well located.
Our platform: The Extra Space technology platform is a key driver of our success. Our analytical approach to running the business allows us to take an objective approach to increase shareholder value.Thomas: Today your company has around 900 facilities, including around 200 managed. What is your plan for growing the third party management model and what are your target markets for growth?- Kirk: During the economic downturn, when acquisitions and development were unproductive levers of growth, Extra Space was able to turn to our third-party management platform to continue to drive revenue. This platform has seen substantial growth over the past three years, and there are three primary benefits in providing this service: Access to a pipeline of properties that can fuel our growth through acquisition. While we may not always get the best deal, we get the first shot at it and typically avoid a broker fee. Retention of 100% of tenant insurance revenue. Since we assume all of the risk through our captive insurance company, we retain all of the profits from the program. Growth of our footprint, across which we can spread fixed costs and expand brand awareness. We'll continue to selectively grow our third-party management platform by carefully choosing the markets we enter with the goal of creating mutually beneficial partnerships. Our track record of providing proven industry-leading results is the best calling card we can have.