Operating evidence and financing
What this package helps you examine
Self-storage underwriting begins with the difference between occupied space and collected rent. Unit count, rentable area, promotions and tenant balances can tell different stories. Build an evidence package that reconciles them and shows whether a proposed rate increase, expansion or lease-up can fund its own operating and financing obligations.
Measure the denominator carefully
Reconcile unit count and rentable square footage by unit type. State whether occupancy uses units or area and whether it is measured at a date or averaged over a period. Public Storage's issuer-specific definitions distinguish rent per occupied area from rent per available area; those definitions are useful context, not a universal lender metric. A high physical occupancy percentage can coexist with weaker collections or promotional rents.
Bridge street rates to collected income
Separate advertised rates, in-place contracted rent, discounts, promotions, delinquency and write-offs. Support proposed rate changes with actual tenant cohorts and collection evidence rather than applying the current advertised rate to every occupied unit. Identify administrative, late, insurance-related or other income distinctly, including the related expenses and any contractual restrictions on what the owner retains.
Fund lease-up and capital together
Expansion can add units before those units generate cash. Schedule construction, new operating costs, marketing, concession periods and occupancy growth. A competing facility may affect the timing and price needed to lease space; record that as a supported scenario rather than a forecast certainty. Include security, access, roof, paving and other property-specific capital needs in the funding plan.
Use the workbook
- Use Assumptions!D5 for Base (1) or Downside (2), and the labeled scenario input rows. Enter source data in Storage Activity!D10:L21; preserve formula cells and an untouched workbook copy.
- Paying occupancy is economic occupancy after bad debt. Enter promotions separately only if they are not already reflected in paying occupancy or unit rents. Climate and standard units retain separate pricing; reconcile to unit-level evidence.
- Reconcile Operations to Summary. Apply the entered lender adjustment separately to the modeled cash flow. Sizing uses amortizing debt service, while first-year payments reflect the entered interest-only period.
- In Assumptions, replace illustrative value, LTV, DSCR, debt yield, rate, amortization and requested ceiling with the intended scenario. Review capacities in Debt and Funding. The smallest modeled capacity does not establish eligibility or approval.
- Closing equity includes the entered opening cash and restricted reserves. Additional operating cash need is measured after that opening cash, so do not add it twice. Inspect monthly cash and remaining principal at maturity.
- Read Review for model conventions and limitations. Save each scenario with its supporting evidence and date; actual lender definitions, legal rights and professional findings control the transaction.
Questions to prepare for a lender
Are occupancy and rent measured on the same inventory?
Unit and area reconciliation with consistent dates and averaging conventions.
What portion of scheduled rent is collected?
Tenant ledger, concessions, delinquency and cash reconciliation.
How durable are higher rents?
Move-in cohorts, rate-change history, move-outs and collected-rent evidence.
Which ancillary income belongs to the borrower?
Contracts, remittance records and associated expense detail.
What does expansion require before stabilization?
Cost and delivery schedule, lease-up assumptions and monthly cash plan.
What happens if competing supply delays absorption?
Documented local deliveries and a separate slower-lease-up scenario.
03 / Prepare
Build the evidence file
Use this as a preparation checklist. The lender determines the documents, definitions and review conditions for the actual transaction.
Cash flow and operations
- Unit-level roll with size, type, status and in-place rent.
- Rentable-area reconciliation and occupancy calculation definitions.
- Collections, arrears, write-offs, discounts and promotional periods.
- Monthly operating statements and bank reconciliation.
- Ancillary-income contracts and net retained-income calculations.
- Move-in, move-out, pricing and tenant-cohort history.
Property and collateral
- Site and building plans with legal unit inventory and access.
- Condition assessment covering roofs, paving, drainage, security and gates.
- Environmental and other third-party reports requested.
- Expansion approvals, construction scope and delivery dates where relevant.
- Equipment and security-system ownership and maintenance obligations.
- Evidence of reported competing projects used in the downside case.
Sponsor and execution
- Sponsor operating and lease-up experience in self-storage.
- Property-management platform and pricing/collection responsibilities.
- Ownership, borrower and guarantor documents.
- Available liquidity after expansion and other property commitments.
- Portfolio debt, guarantees and competing funding needs.
- Equity authorization for a longer promotional and lease-up period.
Closing and funding
- Payoff, title and transaction-cost documentation.
- Lender-approved inventory and cash-flow assumptions.
- Construction or repair holdback conditions and completion evidence.
- Insurance and restricted-account requirements.
- Management and material contract transfer or consent requirements.
- Monthly closing-to-stabilization cash bridge with verified sources.
Watch for these assumptions
- Do not compare square-foot occupancy with a unit-based denominator without a bridge.
- Advertised street rent is not the same as rent collected from existing tenants.
- Avoid deducting a promotion twice through both reduced rent and a separate concession line.
- New units increase capacity before they necessarily increase cash available for debt service.
Before you rely on the result
- Reconcile inventory, occupied area and actual collections.
- Separate current performance from the rate-growth and expansion cases.
- Identify the deepest lease-up funding need before allocating surplus cash.
Scope and limitations
- Educational analysis; not a financing offer, appraisal, legal opinion or program eligibility determination.
- Workbook figures and thresholds are illustrative editable assumptions, not current lender quotes or universal underwriting standards.
- Document requests depend on the lender, transaction, jurisdiction and property; address unresolved issues with the relevant qualified professional.
Sources and applicability
These references support the stated asset and risk context. The questions and document lists are preparation tools, not a statement that every lender requires or accepts the same package. Actual contracts, applicable rules and the chosen lender determine the transaction requirements.
- Public Storage — 2025 Form 10-KItem 7; Same Store Facilities operating measures; footnotes (c) and (d), printed page 32 · Checked 2026-10-21Issuer-specific reporting definitions; not a universal lender underwriting standard.
- OCC — Commercial Real Estate LendingPrinted page 43: DSCR and debt yield · Checked 2026-10-21Sizing concepts; modeled assumptions are not lender offers.