Greetings, and welcome to the National Storage Affiliates' Third Quarter 2024 Conference Call. 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. 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. We 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 are 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 a material change in customer behaviors. Turning to the internalization of our PRO structure. We are making great progress, and we remain ahead of schedule on the transition of PRO stores to NSA management. We're about 85% done transitioning the web and operating platforms. The remainder will be completed by mid-November. We're almost 70% complete on the transition of operations management, which consists primarily of hiring, onboarding, training and implementing standard operating procedures. We expect to be finished mid-December with this piece. We've completed about 50% of the initial store rebranding. We also remain on track to achieve the accretion levels that we have previously highlighted. We're encouraged by the early benefits from commonizing the customer acquisitions and revenue management strategies. Overall, we're pleased with how well the transaction has gone to date. Moving to the acquisitions environment, we have seen more opportunities come across our desk, and the team has been busy underwriting a variety of deals. Successfully closed on two portfolio transactions using our 2023 JV, including a five-property portfolio in the Rio Grande Valley of Texas and a 13-property portfolio in Oklahoma City for approximately $148 million. These portfolios are in markets where we already have a strong footprint and will improve our overall portfolio quality and increase our operational efficiencies. Although the operating environment will likely remain competitive in the near term, we remain optimistic that the benefits from the internalization combined with an improving acquisitions environment and eventual recovery in the housing market will lead to improving performance going forward. I will now turn the call over to Brandon to discuss our financial results.

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% compared to the same period last year, mainly due to the decline in same-store NOI. For the quarter, revenues fell by 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 decrease in rent revenue per square foot. Expense growth was 1.2% in the third quarter, primarily attributed to property taxes and insurance, partially offset by reductions in personnel and repair & maintenance. Now regarding the balance sheet, last month, we issued $350 million in 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 approximately 40 basis points higher now compared to when we priced the transaction. We utilized the proceeds to retire the $325 million Tranche C term loan due in January 2025. In July, we also paid off the $145 million Tranche B term loan that was due, totaling $470 million in debt paid off during the third quarter. We have only $16 million of mortgage debt maturing for the remainder of 2024 and no maturities in 2025. Our current revolver balance is around $400 million, which gives us $550 million of availability. As Dave noted, we are exploring more acquisition opportunities, and as advantageous deals arise, we will strategically seek to term out the balance on the line of credit to ensure ample capacity. We are comfortable with our leverage, which was 6.4 times net debt to EBITDA at the end of the quarter. As discussed on our last call, relating to the PRO internalization, on July 1, all subordinated performance units associated with our PRO structure were converted into OP units, eliminating further sharing in the operating performance of the former PRO-managed properties. Additionally, on July 1, we bought out the management contracts and tenant insurance economics related to the PRO-managed stores. All relevant details will be included in the release and the 10-Q that we will file later today. Regarding the recent hurricanes, damage from Hurricane Helene was mainly minor during the quarter. After the quarter ended, Hurricane Milton had a more significant impact on our portfolio, with moderate roof damage to a few stores and one store experiencing flooding that affected several hundred units. Cost estimates are preliminary, but we anticipate total damages will be less than $2 million. Now, moving on to our guidance for 2024, we’ve reaffirmed the midpoints for same-store NOI growth of negative 5.5% and core FFO per share of $2.40, with the high and low ends of the ranges representing low probability outcomes. Thank you again for joining our call today. Let’s now turn it back to the operator to take your questions.

Our first question comes from 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 one-time benefits. The joint venture deals that Dave described earlier, we did have roughly $800,000 in fees in the third quarter related to those deals, and roughly $650,000 of that is one-time 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 one-time 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 one-time 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 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 the Phoenix, Las Vegas market, a little bit of Southern California. 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. 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, we did see a movement in rentals. 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. 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 could move them not only on new move-ins going forward on the existing tenant base. We stepped back in the third quarter, scrubbed those early transition stores that were past that 45, 60-day period, and we've implemented some 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. We're pleased with 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. 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, 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?

Thank you for the question, Todd. To clarify, there are several components of the FFO accretion related to the PRO internalization that we shared. One key aspect is the savings on G&A and the benefits from tenant insurance. The tenant insurance benefit began on July 1, which is reflected in our management fees and other revenue in our profit and loss statement. You can see the improvement compared to the previous quarter and year. Regarding G&A, if you look at our supplemental schedule 9, it outlines the G&A expense from our P&L, specifically highlighting supervisory and administrative fees, which are the management fees we pay the PROs. In the first two quarters, that averaged $5 million per quarter. As we've discussed before, we have new agreements in place for the PROs to manage the stores and perform accounting and other back-office tasks until the transitions, as Dave mentioned. Consequently, that amount has decreased from the $5 million run rate to $3.4 million in the third quarter and will continue to decline through the fourth quarter and into next year. We're beginning to see some of these benefits, but they aren't fully reflected yet in the third quarter figures. By early 2025, we expect to fully realize the benefits from both tenant insurance and G&A on a run rate basis. However, it's important to note that we will lose the benefit of the SP unit sharing, and since NOI is expected to be negative in the near term, that was a compromise we accepted during the PRO internalization process. The projected same-store growth for the fourth quarter in our guidance reflects a higher year-over-year same-store NOI growth in the third quarter without SP unit sharing, which is part of the calculations moving from Q3 to Q4. These are the key points I wanted to highlight, Todd. Additionally, just to mention, the other components of the accretion will come from operational benefits, and Dave has addressed some of that. To fully capture these benefits, we will need a complete year and a typical leasing cycle next spring and summer. When the fundamentals improve and we achieve positive NOI growth, that will also provide a boost by eliminating the economic sharing.

Okay. That’s really helpful. And then in terms of the transaction environment, you're obviously 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. 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 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 in 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, our ability to underwrite forward-looking revenue numbers, all those things are starting to be clear for everyone and be more consistent for everyone. We're actually finding opportunities that we like in markets we like, and we're able to move on. So that's encouraging from the acquisitions front. I think that continues. 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 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 and 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. Selling the assets and recycling into better assets is really attractive to us. We can use vehicles like 1031 exchanges to make some tax efficiencies there and some opportunities around that piece of it. Look for us over the next three to six months; you'll start seeing some activity on listing our properties and over the next six to nine months sale of properties. The heavy lift is over, though. 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. How would you characterize the current environment, your thoughts heading into 2025?

Good question. Thanks for joining today. We have a very diversified portfolio, and there are many ways to analyze what's happening in the markets and individual assets. Currently, we are more heavily invested in the Sunbelt and single-family housing. These markets experienced significant growth during the pandemic and now face tough comparisons and elevated supply, particularly in cities like Atlanta, Phoenix, and Las Vegas, which are likely to remain challenged. We need to navigate through the new supply and some fundamental issues that haven't yet bounced back due to changes in the housing landscape. Despite this, we have identified markets across the country where we are successfully increasing occupancy and rates. Our customer base is still very healthy, and we are seeing strong results from the ECRI program. As we achieve stability in occupancy and rates, it encourages us. One market to note is Portland, Oregon, where we've stabilized occupancy and rates despite facing challenges from supply. Although it still has room for improvement, this stabilization is a positive indicator. In our numbers, we anticipated that the second quarter's spring leasing season would be shorter than usual, which it was, and we faced challenges in the third quarter. However, we are optimistic about October. We previously mentioned the spread, and I can update you on our occupancy figure for October, which as of yesterday stands at approximately 85.8%. This is a decline of 190 basis points from last year, but it reflects an improvement over September. Overall, while we see a variety of challenges across different markets, we were pleased with the rental activity, move-out volumes, and the occupancy increase in October.

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 numbers defy typical seasonality trends, as occupancy usually drops from summer peaks until nearly February, with high points in June, July, and August, and a low in February. However, we were pleased to see that rental activity in October was somewhat stronger. We are actively working on various strategies including pricing, advertising, and discounts to attract customers, but the situation varies by market. There are many factors at play, yet we were satisfied 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 say you are correct, we were down 17% in the third quarter. However, if we examine the third quarter closely, we see that it started to improve from July through September. We were perhaps in the low to mid-teens in July, and by September we were in the low 20s. This trend has continued into October, where we are now in the mid-20s. There are two main factors at play for us. We are working to find the right mix of rates, discounts, and marketing spend to achieve our desired rental volume. October has shown positive results in this area, which we appreciate. Additionally, as part of the PRO transition, we are revisiting our portfolio and implementing our revenue management, marketing, and customer acquisition strategies. Some of the movement we saw in September and October may be a bit exaggerated as we refine our approach with the PRO portfolio. It’s also encouraging to see Phoenix and Las Vegas responding well to our new positioning. However, I’m uncertain how much further we will improve compared to the previous year for the remainder of the year. We have conducted significant groundwork on street rates over the last three months, and if we continue to see favorable rental activity, we may not see as much change in November and December.

Got it. So you see it as like this October is kind of like the trough, and then for street rates, 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 for 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 wanted to follow up on the previous question. Street rates decreased by 20% year-over-year in October, which is quite significant. I understand that in trying to increase occupancy, you might have to accommodate the tenants. However, I am curious about how you plan to manage the impact of these lower street rates in the short term. Will it involve reducing marketing efforts? I'm interested in knowing how you intend to handle these new street rates to maintain the ROI or profitability you aim for.

That's a great question. There are several factors to consider here, particularly regarding our operational efficiency to help balance that out. The occupancy increase in October is also something we shouldn't overlook, as it contributes to our revenue. We're looking at the street rate while trying to balance the right rental activity with customer demand and priorities. Currently, customers are very focused on pricing. We expect this might change over time, but at the moment, price is a significant motivator for customers when they are searching for units. Additionally, we are working diligently on the backend rate. Once customers come through the door, we are better equipped than ever before and confident we can recover the initial rate faster than in the past. We strive to balance asking rent, marketing spend, and the number of customers we want in the market and within properties, even considering unit size. These factors help us manage the asking rent. Additionally, the length of stays has increased significantly, and our customers are in good health. This means that bringing a customer in today allows for a longer time frame to maximize their lifetime value.

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 street rates are bottoming 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 there are two aspects to consider when discussing the private sector. The larger private operators, who tend to be more sophisticated, are definitely monitoring and responding to the actions of the public groups. They are able to adjust their strategies quickly in either direction. However, the majority of the segment, which consists of these larger, more sophisticated private operators, have not made any moves. In many of our markets, particularly throughout COVID, they did not increase their rates at all. Now that things have returned to pre-COVID levels, they are back operating at the same capacity. The less sophisticated operators, on the other hand, have not made any changes whatsoever.

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, are you doing that into an environment where top of the funnel demand is stabilizing, improving? Or how would you characterize the overall demand?

Yes, good question. I think the top of the funnel is likely stabilizing. Anecdotally, our surveys indicate that more customers are renting storage units due to moving, which is an improvement we've observed over the last few months. However, we aren’t seeing a significant increase or decrease in web sessions or inquiries at the top of the funnel; it has remained quite stable. We are working on improving our conversion rate to attract more of those customers.

Great. My quick follow-up is on the expense side. Aside from the usual property taxes and insurance, is there anything we should be aware of for this quarter and 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, is expected 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. 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. I wouldn't say that's necessarily 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 and the Southern California that we started to transition from the PROs. We tried our best to hire as many of the people that we could that were 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. 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 a 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. I think it's because of the factors we discussed earlier. I think the sellers' expectation and buyers' expectations are getting closer, 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 number of calls, the amount of things crossing our desk, opportunities. I think that carries into 2025. 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 find 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, we have been exploring various assets that would be suitable for that venture. We believe this provides access to high-quality capital at a reasonable price, which aligns with our preference for lower capital requirements. We are interested in this venture and aim to keep pursuing opportunities there. On the development front, it's not something we are keen to focus on within this venture. However, we may consider some opportunistic properties, but our primary goal is to identify more established assets from which we can derive greater value, and that's our focus.

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?

Certainly. It's quite noteworthy. During the pandemic, many people became familiar with storage for various reasons. The need for home offices persists; even though some may return to physical offices, home offices remain in use. Similarly, home gyms continue to be relevant. Many individuals took the opportunity during that time to declutter their garages and engage in other organizing activities, which has had lasting effects. We've also introduced self-storage to customers who had never considered it before, and they have found it to be convenient, affordable, and a great way to utilize space, time, and money. This has resulted in an extended length of stay that surpasses pre-pandemic levels. We haven't observed any significant changes recently; the length of stay is elevated, possibly slightly decreasing from the peak levels of the pandemic, but still well above those pre-pandemic figures. This presents an opportunity to enhance our ECRI program by considering the frequency of interactions. Currently, our same-store tenant length of stay exceeds 40 months, allowing us multiple engagement opportunities related to ECRIs throughout that duration. Our confidence in ECRIs is bolstered by our improved systems, technologies, and strategies, which have helped us better sustain this length of stay than in the past.

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? 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 probably predominantly used prior to the pandemic, where you were giving a first month free or three months free. We haven't introduced as much discounting back; it's still the same concession, right? You're still giving up a percentage of the rent throughout. What has returned after the pandemic is more of a sharp entry price, and then you're using ECRIs to back it up on the backside of that, right? It is a little different strategy. I think what changes going forward is, I do think fundamentals improve, supply eases. I don’t think it will be as competitive to attract new customers as it was over the last 12 to 18 months. Everyone gets more comfortable with levels, we get more comfortable and where our footing is. We gain some strength in street rates; I think the consumer kind of follows what we give them. 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 for 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.