INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

6 Months Ended

Jun. 30, 2026

INVESTMENTS IN UNCONSOLIDATED REAL ESTATE VENTURES

INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

5. INVESTMENTS IN UNCONSOLIDATED REAL ESTATE VENTURES

The Company’s investments in unconsolidated real estate ventures are summarized as follows (dollars in thousands):


		CubeSmart		Number of Stores as of				Carrying Value of Investment as of
		Ownership		June 30,		December 31,		June 30,			December 31,
Unconsolidated Real Estate Ventures		Interest		2026		2025		2026			2025
CBPR Storage Venture, LLC ("CBPR")		15%		1		-		$	2,016		$	-
Fontana Self Storage, LLC ("Fontana") ⁽¹⁾		50%		1		1			12,637			12,837
Rancho Cucamonga Self Storage, LLC ("RCSS") ⁽¹⁾		50%		1		1			19,289			19,568
191 V CUBE LLC ("HVP V")		20%		6		6			9,704			10,505
CUBE HHF Northeast Venture LLC ("HHFNE")		10%		13		13			1,171			1,230
CUBE HHF Limited Partnership ("HHF")		50%		28		28			28,639			29,894
				50		49		$	73,456		$	74,034

(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. These differences are being amortized over the expected useful life of the self-storage properties owned by the ventures. As of June 30, 2026, the remaining unamortized difference was $11.9 million for Fontana and $17.8 million for RCSS.

On February 20, 2025, the Company purchased the remaining 80% interest in HVP IV for $452.8 million and consolidated the venture’s assets and liabilities. The $452.8 million purchase price included $44.4 million to repay the Company’s portion of the venture’s existing indebtedness, which was repaid in full at the time of the transaction (see note 4).

The Company determined that CBPR, Fontana, RCSS, HVP V, HVP IV, HHFNE and HHF (collectively, the “Ventures”) are not VIEs in accordance with the accounting standard for the consolidation of VIEs. As a result, the Company used the voting interest model under the accounting standard for consolidation in order to determine whether to consolidate the Ventures. Based upon each member’s substantive participating rights over the activities of each entity as stipulated in the operating agreements, the Ventures are not consolidated by the Company and are accounted for under the equity method of accounting (except for HVP IV, which was consolidated upon the Company’s purchase of the remaining 80% interest on February 20, 2025). The Company’s investments in the Ventures are included in Investment in real estate ventures, at equity on the Company’s consolidated balance sheets and the Company’s earnings from its investments in the Ventures are presented in Equity in earnings of real estate ventures within the Company’s consolidated statements of operations.

The amounts reflected in the following table are based on the historical financial information of the Ventures. The following is a summary of the financial position of the Ventures as of June 30, 2026 and December 31, 2025.


		June 30,			December 31,
		2026			2025

Assets		(in thousands)
Storage properties, net		$	378,532		$	367,994
Other assets			15,026			15,283
Total assets		$	393,558		$	383,277

Liabilities and equity
Debt		$	250,391		$	249,449
Other liabilities			8,365			5,224
Equity
CubeSmart			43,770			43,917
Joint venture partners			91,032			84,687
Total liabilities and equity		$	393,558		$	383,277

The following is a summary of results of operations of the Ventures for the three and six months ended June 30, 2026 and 2025.


		Three Months Ended June 30,						Six Months Ended June 30,
		2026			2025			2026			2025⁽¹⁾

		(in thousands)
Total revenues		$	15,017		$	14,296		$	29,753		$	34,418
Operating expenses			(6,543)			(6,256)			(13,074)			(15,173)
Other expenses			(240)			(128)			(252)			(238)
Interest expense, net			(2,923)			(3,013)			(5,826)			(7,941)
Depreciation and amortization			(4,450)			(4,056)			(8,801)			(10,352)
Net income		$	861		$	843		$	1,800		$	714
Company’s share of net income		$	556		$	547		$	1,163		$	926

(1)

HVP IV’s results of operations are included through February 20, 2025 (date of consolidation).