Hello, everyone. Thank you for joining us, and welcome to Extra Space Storage Inc. Q1 2026 earnings call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Jared Conley, Vice President of Investor Relations. Please go ahead. Thanks, Karen. Welcome to Extra Space Storage's first quarter 2026 earnings call. In addition to our press release, we have furnished unaudited supplemental financial information on our website. Please remember that management's prepared remarks and answers to your questions may contain forward-looking statements as defined in the Private Securities Litigation Reform Act. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in the company's latest filings with the SEC, which we encourage our listeners to review. Forward-looking statements represent management's estimates as of today, April 29th, 2026. This 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. I would like to now turn the time over to Joe Margolis, Chief Executive Officer. Thanks, Jared, and thank you everyone for joining today's call. We are pleased to report first quarter core FFO of $2.04 per share, up 2% year-over-year. Our solid performance demonstrates the strength and resilience of our diversified portfolio and best-in-class platform as we navigate an improving operating environment. Operationally, we delivered positive same-store revenue growth of 1.7%, which exceeded our internal projections. We ended the quarter with same-store occupancy at 93% compared to 93.2% in the prior year, with the year-over-year occupancy delta improving 50 basis points since year-end. We did this while continuing to achieve positive rate growth to new customers during the quarter. Our systems continue to optimize for total revenue with no preference for move-in rate or occupancy. We are seeing encouraging broad-based revenue improvement across our markets, driven primarily by declining new supply. The sequential new customer rate gains we have been achieving over recent quarters are now translating into revenue growth. These positive operating trends position us well as we enter the leasing season. Our diversified external growth platform continues to be effective across multiple channels. We continue to review a high volume of acquisition opportunities while maintaining a disciplined approach given current asset pricing relative to our cost of capital. We are projecting $200 million in total acquisitions for 2026 under the assumption that we will close materially more in total transactions, primarily in asset-light joint venture structures. Our bridge loan program continues to perform well, maintaining an average balance of approximately $1.5 billion in Q1 2026. This program not only generates attractive interest income, but also serves to expand our management business and provides an opportunity for future acquisitions. Our third-party management platform added 84 stores in the quarter with net growth of 60 stores, bringing our total managed portfolio to 1,916 stores. The consistent demand for our management services demonstrates the value we deliver through superior property performance, operational expertise, and our data and technology platforms. Overall, we are encouraged by our first quarter performance. The sequential improvement across our portfolio gives us confidence in our ability to capitalize on continued supply moderation and strengthening fundamentals as we progress through 2026. I will now turn the time over to our CFO, Jeff Norman. Thanks, Joe, and hello, everyone. As Joe mentioned, we are off to a good start in 2026, and we are especially pleased with our store level operating performance. Same-store revenue accelerated 130 basis points from 0.4% in the fourth quarter of 2025 to 1.7% in the first quarter of 2026. Same-store NOI growth improved 110 basis points from 0.1%- 1.2%. We are seeing the benefit of multiple quarters of positive new customer rate growth begin to flow through to revenue growth, and our pricing models continue to utilize rate, occupancy, and marketing spend to drive total revenue. We also had solid expense control with all categories in line with our estimates outside of utilities and repairs and maintenance, which ran higher than expected primarily due to snow removal and other weather-related items. Excluding the above budgeted portion of weather-related expenditures, total year-over-year expense growth would have been 1.5%. Our ancillary businesses also delivered strong performance during the quarter. Management fee and other income grew over 9% year-over-year, reflecting our expanding third-party management platform. Net tenant insurance growth was over 5%, and our bridge loan program produced steady fee and interest income. All components of our diversified revenue model are performing well and contributing to our overall results. Our balance sheet remains in excellent shape, with 83% of our total debt at fixed interest rates, a figure that increases to 93% on an effective basis when accounting for our variable rate loan receivables. Our weighted average interest rate stands at 4.3%, we currently have approximately $2 billion in capacity on our revolving lines of credit, providing us with strong liquidity and plenty of growth capital. We are maintaining our full year 2026 core FFO guidance range of $8.05- $8.35 per share, as well as our same store performance outlook. While our Q1 performance exceeds internal expectations and we're encouraged by the sequential improvements we're observing, we believe maintaining our current guidance range appropriately balances the positive momentum we're experiencing with the uncertainties that remain in the broader macroeconomic environment. We will revisit our annual guidance with our second quarter earnings after the leasing season is played out. In summary, we're encouraged by the acceleration in same store NOI and the strong performance across all parts of our business, driving positive core FFO growth. The combination of our operational strength, talented team, and diversified growth platform gives us confidence in our ability to continue delivering long term shareholder value through 2026 and beyond. With that operator, let's go ahead and open it up for questions. Thank you. We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Michael Goldsmith with UBS. Your line is open. Please go ahead. Good morning. Good afternoon. Thanks. Want to purchase my question. First question, positive move-in rates over the past year seem to carry the same store revenue growth to a much higher level in the first quarter, with the same store revenue growth of 1.7%. Now that move-in rates are moderating, does that weigh on same store revenue growth for the balance of the year? Is that reflected in your same store revenue growth guidance that implies moderation from here? Just trying to understand the impact of street rates flowing through the algorithm, does that imply a de-sell later in the year? Thanks. Yeah, thanks for the question, Michael. Not necessarily. While same store or excuse me, new customer rates are an important part to driving same store revenue growth, obviously all the other revenue levers are also important. We did see new customer rate growth moderate from 5%-6% in January and February to call it little over 1% in March. Then, you know, that averages for the quarter at about 2.5% because of the higher volume that you see from a rental standpoint in March. Over that same period of time, particularly in March, we actually picked up occupancy. As we've always said, we're much more focused on just driving revenue and not focusing on any particular lever. While we're on the topic, I should probably also mention, you probably noticed we converted that metric from reporting new customer rates on a per unit basis to a per square foot basis. While similar, they aren't exactly apples- to- apples, and that reduces the number by about 100 basis points. On a like-to-like basis, move-in rates would have averaged about 3.5% for the quarter. On a per square foot basis, it was closer to 2.5%. Got it. Thanks for that. While we're on the topic, Jeff, do you mind providing an update on what you've seen? You know, we're almost done with April now, but what you've seen so far in April from a street rate and occupancy perspective? Yeah. Continuation of what we saw in March, largely where we continue to see improvement in occupancy from both a sequential standpoint and a year-over-year standpoint where that continues to tighten. A new customer base from a new customer rate standpoint, modestly positive. Continuing to be ahead of budget. Yep. Thank you very much. Good luck in the second quarter. Thank you, Michael. Your next question comes from the line of Samir Khanal with BofA Securities. Your line is open. Please go ahead. Good afternoon, everybody. I guess, Joe, maybe to start off, how would you characterize sort of top of funnel demand today? Maybe compare that to last year and at this time as we start the leasing season. We're curious on your thoughts. Thanks. I think demand is steady, if I had to characterize it. I don't think we've seen any material improvement or any material degradation in demand. Our systems, our platform, our customer acquisition abilities allow us to capture more than our share of demand that's in the market. You know, we continue to be the highest occupied of any of our peers at the highest rates. That's a good spot for us to be in. Maybe as a follow-up on the other side of it, I mean, you know, it certainly feels like commentary is more of optimism, you know. Is that primarily from sort of the lower supply you're seeing? Maybe expand on that, please. Thanks. Yeah, thank you. That's a good follow-up. Yeah, de-demand being steady. The corollary to that is we are seeing improvement in the supply situation. You know, many of the markets that were particularly impacted by supply in the Sun Belt, we are starting to see improvement in those markets. That's very encouraging for us, particularly because, you know, we have, you know, disproportionate exposure to the Sun Belt, which we believe long term is a positive. That's where the growth is gonna be in our country, but in the recent past has been a headwind for us. All right. Thanks a lot, guys. Thank you, Samir. Your next question comes from the line of Brendan Lynch with Barclays. Your line is open. Please go ahead. Great. Thanks for taking my questions. If you could, give us some high level thoughts on the competitive impact to the market from PSA and NSA being combined. Well, I mean, we compete with all of those stores now, so we'll continue to compete with them in the future. I think PSA is a very good operator, and I'm confident those stores will do better under one unified platform than the system NSA was pursuing. You know, we'll continue to compete with them. They're been a good competitor in the past. They'll be a good competitor to us in the future. It's one reason we never stop trying to get better, never stop trying to sharpen our tools because we know we have good competitors who are doing the same. Thanks for that, Joe. Then maybe just on the volume of transactions and your expectations for an improvement there or growth there, can you talk about how seller expectations have changed, if at all, or if there's something else that's driving the increase in volume that you anticipate going forward? It's a really good question. I mean, there is activity in the market. There are things being sold. I would tell you the last two material transactions we saw priced at, on our numbers, sub five initial cap rates without enough growth to make them interesting in the future. That's pretty aggressive. I think capital buyers in the market are seeing that we're in the beginning of this recovery cycle and are underwriting that into their numbers. You know, we have a fairly modest acquisition guidance for this year on a net basis, on a EXR dollar basis. Well, as I said in my remarks, I think we'll close a lot of deals, but many in joint venture structures to make them accretive to our shareholders. I'll also tell you that, you know, we've had a lot of years where we've put out an acquisition number and we end up finding interesting off-market typically things to do. We're, we're very active and we have a lot of relationships and we can be creative and innovative. I know the team is anxious to try to do that again this year. Great. Thank you. Sure. Your next question comes from the line of Ravi Vaidya with Mizuho. Your line is open. Please go ahead. Hi, there. Thanks for taking my question. I wanted to dig a little bit more at the same-store revenue range. It is strong first quarter, exceeding the top end of the range. Can you walk us through the upside and downside scenario for the full year and maybe some color on how you expect the cadence of this will continue throughout 2026? Thank you. From a, well, first of all, appreciate the question, Ravi, and it makes sense. Given where we ended the first quarter relative to our stated same-store revenue range, it makes sense. I think probably the point I want to make most clear is, our lack of adjusting guidance isn't a call from our perspective on expected performance for Q2 through Q4. I think we view it more from the standpoint of it's early in the year. We haven't completed our busy leasing season. And combining that with some of the macro factors that are in the background, it seems to make sense to wait one more quarter, see how the leasing season plays out and make those adjustments at that time. All that said, from a guidance cadence standpoint, so far throughout the year, we've continued to see revenue outperform our internal expectations, and it has accelerated. We do know we have harder comps as we move deeper into the year. If we combine all of those factors, very optimistic about where we stand today versus our stated range, we'll update it after the second quarter. I'd just like to add that, you know, Jeff appropriately points to the risks associated with, you know, macro factors, higher gas prices, inflation, consumer confidence. We haven't seen any of that flow through to our business yet. Customer behavior is unchanged. Customers are still accepting ECRI at the same level they have in the past. Bad debt is down actually to 1.5%. Vacates remain muted compared to historical numbers. We see this across all different demographic markets. That's very positive for us. Our caution isn't because of anything that we've actually seen. It's more of an unknown, and we just feel it's prudent to wait for the leasing season another quarter before we revisit guidance. Got it. Thank you for the color and congrats on the strong quarter. Thank you. Your next question comes from the line of Eric Wolfe with Citi. Your line is open. Please go ahead. Hey, good afternoon. Can you just talk about the reason for the change in the definition of move-in rate growth and what explains the delta between the 2.4% you reported and I think you said mid-threes on the other definition? Yeah, you're exactly right. Thanks, Eric. The reason for the change was really just market feedback. We had heard that from both buy-side and sell-side analysts, I think for consistency with disclosures from other peers and wanted to accommodate that request. In terms of why the delta between the two approaches, what it comes down to is volumes, rental activity between larger and smaller units and pricing power within those units. On the margins, saw stronger pricing power in some of the larger units within the quarter, creating the delta. Got it. You mentioned that I think across both definitions, the rent growth came down a bit in March and April. Can you talk about whether that was just from sort of tougher comps or if something changed in the environment? I know you're always trying to optimize for the best revenue growth. I guess I'm asking why the system determined that sort of lower asking rent growth was the best, you know, revenue-maximizing decision at that time. Yeah, I think it's possible that it's a few of the factors you mentioned combined. Certainly are lapping harder comps, so those continue to become more difficult throughout the year. I think the model is always evaluating price elasticity and seeing where is the optimal balance for total revenue. In March, we did see it lean a little more into occupancy and take more occupancy closing that gap on a year-over-year basis. As we've always said, we're happy with either as long as we feel like we're getting the right revenue outcome. Based on the result, we're really pleased with outcomes in the first quarter. Got it. Thank you. You bet. Thanks, Eric. Your next question comes from the line of Nicholas Yulico with Scotiabank. Your line is open. Please go ahead. Hello, this is [inaudible], with Nick. I have a question on your bridge loans book. You originated only $5.5 million this quarter. Last year it was more than $50 million in Q1. What was the driver behind that slowdown on a year-over-year basis? Was it just the slower activity or interest rate not attractive for you? I don't think this program, just like our acquisition program, is gonna produce steady volume quarter after quarter. There'll be some volumes that are higher, and there are some volumes that are lower. There's some quarters, excuse me, that have higher volume and some quarters that have lower volume. We did have a quiet quarter in terms of originations. We did have a good quarter though with respect to approvals for future loans. The, you know, overall, I think the business is a little slower due to transaction activity and lesser development, right? A portion of our loans are for newly delivered properties, and as the number of those goes down, the number of lending opportunities goes down with it. There's also more competitive lenders, right? There's others who kind of followed us into this business. Overall, we're comfortable and happy with our volume and our ability to make loans and, you know, continue with this program. Got it. As a follow-up, given that your loan book serves as a potential acquisition pipeline, out of your $200 million kind of guidance for this year, how much do you expect to get through this funnel, and how does the pricing differ from what's kind of available on the market otherwise? We don't assume we'll buy anything out of the loan program. That would be additional volume that we could get. You know, our pricing discipline is the same regardless of how the acquisition comes to us, from the management business, from a joint venture, from the bridge loan program around the market. We still wanna make accretive transactions given our cost of capital or structure the acquisition such that we can make it accretive. While we don't specifically model or guide towards a specific volume of acquisitions through the bridge loan program, our experience has been that those opportunities end up coming to fruition. Historically, we've purchased about 25% of the underlying collateral of loans that we've originated. I don't see any reason that we wouldn't continue to see quite a few acquisition opportunities from that program. We don't, we don't model it. To Joe's point, I think we'll see our fair share. Thank you for the additional color. Thank you. Your next question comes from the line of Juan Sanabria with BMO Capital Markets. Your line is open. Please go ahead. Hi. Good morning. I was just hoping Joe or Jeff, if you could talk a little bit about the length of stay and how that's trending. You typically talk about over 12 and 24 months. If you've seen any change in vacates or churn, and if ECRI is affecting any or no? Thanks. We'll answer it in reverse order. As you know, we do monitor real carefully our ECRI induced churn, and we haven't seen any change in that level of churn. That program still seems to be working as designed, and customer behavior has not changed with respect to that. With respect to length of stay, you know, current tenants over 12 months is about 64% of our tenants, and that's 167 basis point improvements from prior year, a year ago, March. Current tenants over 24 months is about 46%, and that's 190 basis points improvement from a year ago. Tenants are staying longer. Our systems continue to do a better and better job targeting and attracting tenants who are more likely to stay longer. It's a great benefit to the business, particularly, you know, where we have steady kind of steady and price sensitive demand. Juan, I would add, you mentioned churn. Churn was really flat for the quarter, so rental and vacate volume on a year-over-year basis, Q1 2025 compared to Q1 2026 is basically flat, and that's comping almost all-time lows. Churn is still relatively muted compared to, you know, a, an average historical number. Thanks for that context. Just on the third-party management, maybe just following up on the bridge loan question, have you seen any impacts from new entrants, either REITs or some of the larger privates looking at managing assets themselves, either on their own behalf or for third parties in terms of squeezing fees or margins or anything like that for that third-party management business? We really haven't. I mean, one, we're not changing our pricing at all. We are the highest priced option in the market because we produce the best results and have the best platform and provide the best service. You know, our growth in this, another 60 net in this quarter is, you know, much faster than any of our competitors. You know, to us it's the market speaking. The market is choosing the best platform even if they have to pay more for us. We have not seen any impact on our business from new entrants. Great. Thank you. Your next question comes to the line of Michael Griffin with Evercore ISI. Your line is open. Please go ahead. Great. Thanks. Maybe circling back on your points earlier, Joe, around revenue optimization, I realize you're not gonna give us the secret sauce, but as you think about the interplay between rate and occupancy, I mean, what are the signals that you're looking at that the team's looking at to say, "Hey, now is a good time to push rate over occupancy"? You've highlighted a number of times about how highly occupied the portfolio is. You know, if you have a market that, say, hits 95% occupancy, as an example, are you really gonna try to push there? How should we think about the push and pull between the interplay of those two? The, the way you've asked the question, you know, makes it seem like Jeff and I and a bunch of the other folks on the team sit around the table and say, "Let's get 50 basis points more occupancy." It really doesn't work that way. We have several proprietary algorithms that were built with our extensive data set that price every unit type in every building every night. We'll look at the five by fives in, you know, on Main Street in Philadelphia and look at historical vacates and many dozens of factors and decide for that unit price, that unit type, it's gonna drop price because that's how it can get the right number of rentals to maximize occupancy. That happens for 2.8 million units every night. That rolls up into something where we say the system is leaning a little bit more towards occupancy. That doesn't mean that's the case with every unit type, every building, every market. Now, while that's going on, we do have data scientists looking at it and, you know, kind of checking it and making sure that there's nothing new in the environment that the algorithm doesn't know that we need to take a second look at or test. That's the level of human involvement, not making individual decisions about greater occupancy. Griff, maybe I would just tack onto that and with our scale and as the tools continue to get better, you can see that data in much, you know, shorter time periods to make those decisions. The system can recalibrate faster than it ever has before, as the data and tools improve, which is a significant advantage for the large operators. Thanks. I certainly appreciate the helpful context there. Maybe next, just on the same-store expense growth and the cadence. Seemed like the quarter was pretty down the fairway relative to the guide. Jeff, as I'm thinking about it, I know there were probably some more elevated operating expenses in the middle part of last year called 2Q, 3Q. Can you maybe walk us through, if you can give us some color on expectations of cadence? Is it easier comps in the second and third quarter? Just how should we think about sort of same-store expenses on a quarterly basis for the balance of the year? Yes. I think it's more of a first half, second half comp differential. First half you had easier comps with property taxes in particular being the real standout. We'll lap that in the back half of the year and have more difficult comps, but still anticipate similar performance. As you mentioned, relative to the guide, we're well within it. Outside a couple of those weather-related exceptions that I mentioned, all of our expenses came in really right in line with what we expected. Maybe one specific call-out, Griff, that would be helpful just because it's a little larger magnitude and timing base is our insurance expense, which in Q1 was over 10%. We renew our insurance policies in the end of May, and all of the feedback we're getting so far, we're actively negotiating that renewal right now is that it's a favorable environment for insurers, and we expect that to come in, relatively flat, if not better. We were optimistic that we also have some opportunity with insurance, which was already factored into our guidance. We figured that would be the case. Great. That's it for me. Thanks for the time. Thank you. Thanks, Griff. Your next question comes from the line of Ronald Kamdem with Morgan Stanley. Your line is open. Please go ahead. Hey, great. Just two quick ones. Staying with expenses. You know, I know philosophically you guys have had a little bit of a different view in terms of the sort of the, the service associates that are in the stores and the ability to sort of optimize the revenue with that person there. I guess my question is just as you're thinking about the next two years, you know, is there more opportunities to take expenses out of, out of the structure or is it pretty much as optimized as you can get? Thanks. I think there's always opportunities to take expenses out of the structure, and I think there's several factors that will lead us to that. One is growth intensification. As we get more stores in a market, it becomes more efficient and we can run those stores with, you know, fewer people and supervisory people, right? If a district manager has to fly to three different markets, he can cover fewer stores than if all of his markets are in one store and he can drive to them. He or she can drive to them. That growth is one. Second is AI. Certainly we're looking at lots and lots of opportunities for, you know, reporting and analysis and audit and all sorts of different things that we can get more efficient through using AI tools. Then third is customer preference. You know, right now we like to have managers in the stores more than our competitors because the customers want that. 39% of our customers end up signing a lease by choice sitting across the table from a store manager. 28%-30% of those have never interacted with us on the web or on the phone. They all have phones. They all have computers. They can call the call center. They can do a transaction totally online. They're choosing to come to the store for a reason. They want to see the five by five. They want to see how clean it is. They don't understand how to get into the gate, et cetera. As long as the customers want that, we'll provide it. We also know that when you look at the demographics, the younger customers want that much less than the older customers. As our customer base ages, we imagine that demand by customers will get fewer and fewer, and at that point we will need fewer and fewer people on site. Yes, sorry for the long answer, but yeah, there's always opportunities to continue to gain expense efficiencies. At a high margin business, we will always keep an eye on the revenue line item and make sure that nothing we're doing on the expense line item is gonna damage the revenue line item because that is of much more importance. Great. That's really helpful. My second question, if I may, is just on the revenue line item when you sort of talked about, you know, the algorithm that's pricing 2.8 million units sort of every night. If you think about sort of the. You know, with AI coming in, you know, the amount of data on the customer is only gonna go up exponentially. I guess I'd love to hear some thoughts on how you integrate that, you know, new wave of data on the customer and how does that sort of plug into this algorithm to maybe even make it more efficient. Thanks. Our algorithms have had what we used to call machine learning in them for a long time. I guess that's a form of artificial intelligence. I wish I knew the answer to your question. I think there's lots and lots of opportunities, and the biggest challenge with implementing AI is, you know, triaging the opportunities, understanding them, and then implementing them in an effective and safe manner. Luckily, we have a lot of smart people here who are focused on that. I don't have to be the expert on that because it's there's not one clear roadmap. I think we and other large companies have the, you know, ability, technology, resources to focus on that and effectively implement AI in our pricing models and in lots of other areas of our business. I think it's just gonna increase the kind of gap between the large and small companies and how they can operate their businesses. Thanks so much. Thank you. Your next question comes from the line of Todd Thomas with KeyBanc Capital Markets. Your line is open. Please go ahead. Yeah. Hi. Thanks. Good afternoon. In terms of the first quarter outperformance relative to your budget, which, you know, you mentioned has carried into April, you know, the same-store revenue growth and the improvement you saw was relatively broad-based across the portfolio. Where did you see the wins or the outperformance? Is there anything specific that you can point to that, you know, resulted in the better results in the quarter? Yeah. Some of your stronger markets, Todd, you can see in the results include Chicago, Washington D.C., a lot of the Midwest and coastal markets. As we've talked about for a long time, the strongest correlation seems to be new supply. Places where there was less pressure from supply earlier are the areas where we got pricing power earliest, which is now flowing through to revenue. You've seen some of that, you know, pricing benefit starting to roll through to other stores. I think Joe mentioned earlier in the call that in some of our Sun Belt markets where we had experienced a lot of headwinds from a new customer rate standpoint in 2024 or 2025, we're starting to get a little more traction as well. No specific, you know, tailwind that I'd say is driving outside of improvements in fundamentals driven by supply. Okay. Yeah, I guess following up a little bit, my second question was about the Sun Belt. I'm just curious, do you think the Sun Belt, you know, is sort of out of the woods here? You know, there were some of the larger sequential moves, you know, in the quarter were in some of the Texas markets, Atlanta, Phoenix. I mean, do you see those trends continuing in the near term? I know that you've integrated the Life Storage portfolio now for a couple of years, but, you know, are you seeing any greater momentum in that portfolio now that conditions are starting to recover? The Sun Belt doesn't operate as one market. It's hard for us to say the Sun Belt's doing this, the Sun Belt's doing that. You know, we are big believers in diversification and that markets act differently, and we wanna have exposure to lots and lots of good growth markets. There are some, you know, Sun Belt markets that performance has significantly improved. Atlanta, Austin, Dallas, Miami, Phoenix are some examples of those. You know, Southwest Florida, Tampa, still facing some headwinds and some difficulties. Houston is another one I'd put. We are seeing recovery in many markets, but not in all markets. The LSI stores, to the extent that they were disproportionately in the Sun Belt, are having that experience. Overall, their performance is akin to Extra Space stores now. Todd, you know, you asked, Joe, are those markets out of the woods, so to speak? I think we continue to still see a relatively price sensitive new customer. It's not like we are able to, you know, push double digit new customer rate growth across the board. As Joe mentioned earlier, you see that down to the property type, unit type, where we're different products moving better. Then that rolls up into markets and eventually the whole portfolio. It's pretty granular. I think we'll need to keep working through supply in some of those markets, but directionally, it's certainly improving. Okay. Got it. Thank you. Thanks, Todd. Your next question comes from the line of Salil Mehta with Green Street Advisors. Your line is open. Please go ahead. Hi, good afternoon, and thanks for taking my question. You know, I'd just like to touch quickly back on move-in rates here. You know, you've been able to achieve positive move-in rate growth for consecutive quarters now, which is great. I guess the question I have here is, you know, how sustainable or how far can we expect this positive pricing momentum to continue without the lack of the housing market recovery? You know, is the positive momentum that we're seeing from the last few quarters is more of a function of easier comps? I think easier comps are a factor, but I also think with steady demand and reduced supply is another factor, right? You know, it's kind of two sides of the coin, right? If demand stays the same, but if supply reduces, that's positive for us. Salil, I think I'd add that with our original guide, we did not factor in an improvement in the broader housing market to achieve our, our range. Our assumption coming into it was a relatively flat housing market to what we've seen year-over-year. If we were to see some acceleration from the housing market, that certainly would be a tailwind for us and could accelerate the recovery. I think absent that, we'll still see a recovery. It just it's probably a little flatter slope. Great. Thanks for that color. You know, just another follow-up here on the housing market. You know, nationwide, the country is definitely still struggling, but, you know, are you guys perhaps looking at any markets specifically that are perhaps recovering better than average or could be better positioned when home sales eventually or hopefully rebound? Yeah, that's a difficult analysis. When you say looking, I assume you mean from an acquisition standpoint. We found it's really hard to target acquisitions to say, we, you know, we would love to be in Seattle, right? We think we're underexposed in Seattle. We find when we go and identify stores in Seattle and cold call the owners, they put prices on the table that are, you know, pretty aggressive. We need to be a little more reactive to what's on the market as opposed to targeting markets. We've tried that in the past and have not had a lot of success. Great. Thanks for that insight. That's it for me. Sure. Thank you, Salil. Your next question comes from the line of Caitlin Burrows with Goldman Sachs. Your line is open. Please go ahead. Hi, everyone. We've talked a lot about the impact that supply can have, and it seems like it's coming down, so that's good. I guess, can you give any insight on what you're seeing across the industry on new starts and the current expectation of how kind of supply will compare in 2026 for 2025? Maybe visibility on those starts and what it could mean for 2027. Yeah, sure. I think we have really good visibility, maybe better than anyone else, primarily through our third-party management business because we get, you know, an extraordinary number of inquiries from people saying, you know, "We, we want you to manage this development. You know, would you take a look at it for us?" Many of those end up not happening. We do get a sense for the volume of that and whether it's increasing or decreasing. It is decreasing, and what the deals look like. We also look at Yardi data, right? Yardi, I think, produces good data. Their data says that national starts are gonna reduce from 2.8%-2.3% of total stock between 2025 and 2026. Another data point we use is number of our same-store square footage that is having a new competitor delivered in its trade area. That, you know, in 2021, 2022, 2023 was in the high 20%, 84% over those three years. It went down to 13% in 2024, 8% in 2025, and we think it will be 6% in 2026. Clearly new supply is not going to zero, but it's clearly moving in the right direction and we're feeling the effects of that. Got it. Caitlin, forgive me for, you know, pointing out the obvious, but with the lease-up time, since we can't pre-lease these properties, it just is generally on a rolling three or four year basis. Every year that you tack on another one of these single-digit delivery years, using the numbers that Joe provided versus, you know, 2023, that was well into the 20s, you know, there's a material benefit from that. Got it. I think on the previous question, you were just talking about the acquisition environment and that if you seek somebody out, maybe then the pricing's too high. I guess could you talk a little bit about what you're seeing come to market? Is there anything on the portfolio side? I know you said that you mentioned that you might do more on JVs versus a 100% ownership, but what kind of opportunities you're seeing. You know, there are opportunities on the market. I think I referenced earlier in the call the last two sizable opportunities rated at numbers that were initial yields of sub five and, you know, didn't have sufficient growth in them to get the numbers we would consider accretive in a reasonable period of time. You know, most deals we're seeing in the fives somewhere on initial yield, and I know initial yield is not really the most important factor, but it's a good comparative we can all talk to. You know, again, I'm sorry to repeat myself. We're really allergic to growing for growth's sake. When we invest our shareholders' dollars, we wanna that to be an accretive strategic transaction. If we can't do that, we are willing to be patient. Got it. Thanks. Thank you. Thanks, Caitlin. Your next question comes from the line of Eric Luebchow with Wells Fargo. Your line is open. Please go ahead. Thanks for taking the question. Just one on capital allocation. You know, Joe, you were just talking about how acquisition cap rates are still pretty aggressive from what you've seen. Does it change at all your strategy to consider maybe more potential asset sales or potentially buying back even more stock, as opposed to going after deals? Yeah. Asset sales for us is more an effort to improve the portfolio, to sell assets that either wanna reduce our market exposure or we don't think have growth rate, future growth rates that are attractive to the portfolio or maybe require a bunch of capital that we don't think we'll get a return on. We're typically selling those at, you know, cap rates appropriate for the properties that are at the bottom of our portfolio. It, it typically is short-term dilutive, depending on what we use the money for. I guess if we put it in bridge loans or value adds, it's not. So we wouldn't accelerate that as a source of capital. Stock repurchase as a use of capital is not something we're allergic to at all. We bought about $140 million worth of our shares in the fourth quarter at a little bit below $130. We continued that into the very early part of January, bought this quarter $1 million, $1.5 million, something like that, of stock. The stock price then got volatile. It went up. We stopped buying, then it went back down to the level we were buying at. At that period, we felt we had material non-public information, so we didn't feel it was appropriate or fair to buy stock in the market while we possessed such information. We didn't continue that program. That's not to say in the future, if the stock reaches a point that we feel it's an attractive and good use of capital, we absolutely will use that tool. Okay, great. Thanks for that. Just a quick question on L.A. I think you were targeting a 40 basis points headwind from the rent restrictions. Just wanted to confirm that's still what you're expecting, that's in line with your annual guide. When that restriction's ultimately lifted, how quickly do you think you can get rates back to market? Thank you. Yeah, we do expect a 40 basis points headwind, assuming that the state of emergency is in play for the entire year. You know, we've unfortunately, since COVID, we've had lots of experience with states of emergency and them getting lifted and what the appropriate strategy is after that. When that happens, we'll get the right people around a table and look at the facts and situation as it is then and make a decision on what the appropriate strategy is. Thanks, Joe. Sure. Your next question comes from the line of Michael Mueller with JPMorgan. Your line is open. Please go ahead. Yeah. Hi, just 1 question here. There's been a lot of volatility over the past five to seven years. I'm curious, what do you think is a normal level of same store revenue growth in a, in a normal environment? Yeah, it's a great question, Mike. It certainly has been an unusual handful of years with the highest of highs and then some periods that are relatively flat, same store revenue growth. If you looked long term, it would be in the you know, fours range. That includes a few periods post the financial crisis where development was very suppressed for a long time, and we were taking a lot of rate and occupancy sometimes. Maybe that's a little higher than the sustainable long term average, but we certainly would target it being something above inflationary over time. It's been relatively steady throughout, you know, that 20+ year look as we've been a publicly traded company. Outside of the COVID years, there's not been a huge amount of volatility. Got it. Okay. Thank you. Bye. Your next question comes from the line of Eric Wolfe with Citi. Your line is open. Please go ahead. Hey, thanks for taking the follow-up and sorry if I missed it. On L.A., I know you said a moment ago that you still expect 40 basis points, you know, dilution, if you will. I guess you look at the fourth quarter, you were like -oneish-ish. Now you're +1. I guess what caused the sort of jump between the fourth quarter and the first quarter? I guess given your comments, like, I guess you would expect it to come back down for the rest of the year. Like what would cause that? The 40 basis points is a reference to the state of emergency in L.A. County. And our reported results have to do with the L.A. MSA. We have 122 stores in L.A. MSA, and 73 of those are in L.A. County. Our performance is driven largely by the stores outside of L.A. County, where we're restricted with what we can do with rates. That kind of speaks to the acceleration that you're mentioning, Eric, you know, being driven by those non-L.A. County properties. One observation that maybe is interesting is while we haven't seen rate growth and at the same level in those L.A. County stores, given the restrictions, we have seen occupancy build in L.A. County. It's approximately 96% already, and we haven't even started the leasing season. I think it shows the impact of those artificially suppressed market rates, which has also reduced, you know, churn in those properties since they're priced well below market. That headwind from the L.A. County properties will continue and increase throughout the year and the longer this remains in place. Fortunately, the properties throughout the rest of the MSA, as Joe mentioned, are performing really well and ahead of expectation, frankly. Yeah, that makes sense. Thank you. Thanks, Eric. Thank you. We have reached the end of the Q&A session. I will now turn the call back to Joe Margolis, CEO, for closing remarks. Great. Thank you. Thank you everyone for your time and your interest in Extra Space. Great questions, good conversation. As we said, we're very encouraged as the first four months of this year we're running out of schedule and the systems are working and we're optimizing our performance. We look forward to speaking with you after the second quarter. Thank you very much. That concludes today's call. Thank you for attending. You may now disconnect.