INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURE (Tables)

12 Months Ended

Dec. 31, 2021

INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

Schedule of investments in real estate ventures

	CubeSmart	Number of Stores as of		Carrying Value of Investment as of
	Ownership	December 31,		December 31,
Unconsolidated Real Estate Ventures	Interest	2021	2020	2021		2020
Fontana Self Storage, LLC ("Fontana") (1)	50%	1	-	$	14,225	$	-
Rancho Cucamonga Self Storage, LLC ("RCSS") (1)	50%	1	-		21,536		-
191 V CUBE LLC ("HVP V") (2)	20%	5	-		16,080		-
191 IV CUBE Southeast LLC ("HVPSE") (3)	10%	14	14		4,541		5,015
191 IV CUBE LLC ("HVP IV") (4)	20%	28	21		23,223		21,760
CUBE HHF Northeast Venture LLC ("HHFNE") (5)	10%	13	13		1,291		1,628
CUBE HHF Limited Partnership ("HHF") (6)	50%	28	35		38,855		63,668
		90	83	$	119,751	$	92,071

(1) On December 9, 2021, the Company completed the acquisition of LAACO, which included a 50% interest in Fontana and RCSS, each of which owns one self-storage property in California. As of the date of acquisition, the Company recognized differences between the Company’s equity investment in Fontana and RCSS and the underlying equity reflected at the venture level. As of December 31, 2021, this difference was $13.5 million for Fontana and $20.1 million for RCSS. These differences are being amortized over the expected useful life of the self-storage properties owned by the ventures.

(2) On March 17, 2021, the Company invested a 20% ownership interest in a newly-formed real estate venture that acquired its initial self-storage property located in Florida. As of December 31, 2021, HVP V owned five self-storage properties located in Florida (2), New Jersey (2) and New York (1). HVP V paid an aggregate of $143.7 million for these properties, of which $2.2 million was allocated to the value of the in-place leases. These acquisitions were funded initially through pro-rata contributions by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVP V related to these acquisitions was $22.6 million. During the year ended December 31, 2021, the venture closed on an $80.6 million secured term loan. The loan bears interest at SOFR plus 2.05% and matures on September 30, 2025 with an option to extend the maturity date through September 30, 2026, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.

(3) The stores owned by HVPSE are located in Florida (2), Georgia (8) and South Carolina (4). HVPSE paid $135.3 million for these stores, of which $7.7 million was allocated to the value of the in-place lease intangible. The acquisition was funded primarily through the venture’s $81.6 million secured term loan. The remainder of the purchase price was contributed pro-rata by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVPSE related to this portfolio acquisition was $5.6 million. The secured loan bears interest at LIBOR plus 1.60% and matures on March 19, 2023 with options to extend the maturity date through March 19, 2025, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.

(4) The stores owned by HVP IV are located in Arizona (2), Connecticut (3), Florida (4), Georgia (2), Illinois (5), Maryland (2), Minnesota (1), Pennsylvania (1) and Texas (8). The Company’s total contribution to HVP IV in connection with these store acquisitions was $32.0 million. During the year ended December 31, 2021, HVP IV entered into a new $221.6 million secured

loan, which bears interest at LIBOR plus 1.95% per annum, and matures on April 19, 2025. HVP IV used the proceeds from this loan to repay its existing loans (totaling $137.7 million) in full.

(5) The stores owned by HHFNE are located in Connecticut (3), Massachusetts (6), Rhode Island (2) and Vermont (2). The Company’s total contribution to HHFNE in connection with these store acquisitions was $3.8 million. As of December 31, 2021, HHFNE had an outstanding $45.0 million secured loan facility, which bears interest at LIBOR plus 1.20% per annum and matures on December 16, 2024.

(6) The stores owned by HHF are located in North Carolina (1) and Texas (27). On October 5, 2021, HHF sold seven stores in Texas for an aggregate sales price of approximately $85.0 million. The venture recorded gains which aggregated to approximately $46.9 million in connection with the sale. On January 21, 2021, HHF entered into a new $105.0 million secured loan, which bears interest at 2.58% per annum and matures on February 5, 2028. HHF used the proceeds from the new loan to repay its existing outstanding $100.0 million loan in full.

Summary of the financial position of the ventures

	December 31,
	2021		2020
Assets	(in thousands)
Storage properties, net	$	850,250	$	662,833
Other assets		34,760		18,112
Total assets	$	885,010	$	680,945
Liabilities and equity
Debt	$	526,972	$	359,985
Other liabilities		14,500		11,588
Equity
CubeSmart		86,083		92,071
Joint venture partners		257,455		217,301
Total liabilities and equity	$	885,010	$	680,945

Summary of results of operations of the ventures

	For the year ended December 31,
	2021		2020		2019
	(in thousands)
Total revenues	$	88,449	$	67,239	$	72,582
Operating expenses		(37,967)		(30,755)		(32,134)
Other expenses		(1,138)		(430)		(3,227)
Interest expense, net		(12,031)		(11,585)		(14,927)
Depreciation and amortization		(37,805)		(33,086)		(30,107)
Gains from sale of real estate, net		46,966		—		106,667
Net income (loss)	$	46,474	$	(8,617)	$	98,854
Company’s share of net income (loss)	$	25,275	$	178	$	11,122