CubeSmart reported third‑quarter 2025 results, with net income attributable to common shareholders of $82.9 million, down from $100.8 million in the same quarter a year earlier. Diluted earnings per share fell to $0.36 from $0.44. Adjusted funds from operations reached $149.0 million, or $0.65 per diluted share, compared with $153.0 million, or $0.67 per diluted share, in Q3 2024.
Interest expense increased to $29.4 million from $22.8 million a year earlier, driven by a higher average debt balance of $3.44 billion versus $2.94 billion and a rise in the weighted average effective interest rate from 2.99% to 3.32%.
The same‑store portfolio of 606 locations recorded an 89.0% physical occupancy, down from 90.2% a year earlier. Same‑store revenue declined 1.0%, operating expenses rose 0.3%, and net operating income fell 1.5%. Coastal and urban markets performed strongly, while sunbelt properties experienced a balance between rate and occupancy.
CubeSmart’s third‑party management platform expanded to 863 stores, adding 46 new locations during the quarter. This fee‑based segment provides capital‑light growth and contributes to the company’s overall revenue mix.
The company completed the purchase of the remaining 80% interest in the HVP IV venture for $452.8 million, consolidating 28 high‑quality lease‑up locations. The acquisition increases operational control and unlocks potential value from these assets.
CubeSmart issued $450 million of senior notes due 2035 at a 5.125% coupon. Proceeds were used to retire revolving credit facility debt and fund working capital, extending the debt maturity profile and locking in a fixed interest rate amid rising rates.
Guidance for 2025 remains unchanged: adjusted funds from operations per share are projected at $2.56 to $2.60, and diluted earnings per share at $1.46 to $1.50. A quarterly dividend of $0.52 per share was declared and paid. Management noted that occupancy and move‑in rates are stabilizing, supporting a gradual improvement in the second half of the year.
Management highlighted that while the company faces headwinds in sunbelt markets, strong demand in coastal and urban areas, along with the strategic expansion of the third‑party management platform, positions CubeSmart for continued disciplined growth and cost control in a challenging housing market.
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