(Reuters) - Extra Space Storage (NYSE:EXR) on Tuesday forecast 2024 core funds from operations below analysts' estimates, as demand for self storage spaces decline from the highs at the peak of the pandemic.
The return-to-offices by employees from remote working setups coupled with a decline in homes sales have weakened demand for storage, forcing self storage companies to lower rent to attain new customers.
The self-storage REIT now expects 2024 core FFO between $7.85 and $8.15 per share, compared with estimates of $8.34 per share.
"While we expect a headwind from lower new customer rates, we are confident in the durability of self-storage," CEO Joe Margolis said.
The REIT, which owns more than 3,600 storage stores in 42 different states, reported a fourth-quarter adjusted FFO of $2.02 per share, narrowly falling short of analysts' estimates of $2.03 per share, according to LSEG data
Total revenue for the quarter ended Dec. 31 came in at $797.8 million, compared with estimates of $720.8 million.