PSA: Thoughts on Public Storage Canada Acquisition

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PSA: Thoughts on Public Storage Canada Acquisition

EQUITY RESEARCH QUICK TAKE

RBC Capital Markets, LLC

Brad Heffern, CFA (Analyst)

Michael Carroll, CFA (Head of US Real Estate

Research)

Patrick Fox, CFA (AVP)

June 22, 2026

Public Storage

Thoughts on Public Storage Canada Acquisition

NYSE: PSA | USD 320.22 | Sector Perform | Price Target USD 305.00

Sentiment: Positive

News: PSA announced the acquisition of Public Storage Canada, the third-largest self-storage platform in Canada, for total

consideration of $1.2B ($1.67B CAD), consisting of ~75% OP units and ~25% cash with an initial NOI yield in the high-5s (cash flow

yield around 5%). The transaction is expected to close in 2H26.

Our view: We think the acquisition is a slight positive for PSA. We see this as a sensible strategic entry into Canada, with the ROFO/

ROFR structure enabling PSA to acquire at higher yield vs. typical Canadian cap rates and an attractive cost of Canadian debt.

Canada also has favorable demographic tailwinds that we think investors are more familiar with post the SMA IPO. We think the

NOI growth opportunity from occupancy gains (83% to ~90%) and PS Next implementation (PSA mid 70s margin versus 65% for the

acquired properties) is credible, but we do see some execution risk given management is already busy with the NSA acquisition.

• Deal Structure & Pricing. The transaction is funded 75% with OP units ($889mm at $321.98/unit) and 25% cash ($310mm), with

an additional earn-out of up to $288mm in OP units at $375/unit contingent on NOI performance over 5 years. The high-5s initial

yield compares favorably to typically lower cap rates in Canada, enabled by PSA's existing ROFO/ROFR with the Hughes family,

which created an off-market purchase opportunity at attractive pricing.