Public Storage Bought Canada With Stock Not Cash

Public Storage completed its acquisition of Public Storage Canada on September 1, 2026, 71 days after the June 22 announcement. Consideration was approximately $1.2 billion: roughly $900 million in Public Storage OP units — 2.76 million units valued at $321.98 each — plus approximately $310 million in cash. An earn-out of up to $288 million in additional OP units, priced at $375 per unit, is contingent on NOI performance targets.

The portfolio is 68 properties and 5.3 million net rentable square feet across Toronto, Vancouver, Montreal, Calgary and Ottawa.

Derived: $226.42 per net rentable square foot. $17.65 million per property. Average facility 77,941 square feet. Cash is only 25.6% of closing consideration; equity is 74.4%. Earn-out units are struck 16.5% above the closing unit price. Fully achieved, total consideration reaches roughly $1.488 billion, or $280.75 per square foot.

The structure is the story. Public Storage paid for an entire country's platform primarily by issuing partnership units, which means the sellers took paper in the buyer rather than cash out. That happens when both sides believe the acquirer's units are worth holding — and when the seller wants tax deferral more than liquidity.

The earn-out strike is the sharper detail. Setting additional units at $375 against a $321.98 closing value means the sellers collect the contingent piece only if they hit NOI targets and accept units priced 16.5% richer than the ones they just received. Public Storage has pre-sold future equity at a premium to its own current mark, and made growing Canadian NOI a condition of receiving it.

At $226 a foot on 78,000-square-foot average facilities, this is not trophy urban storage. It is scaled, institutional-grade coverage of five metros, bought as market entry rather than asset accumulation. Cross-border scale plays in self-storage are rare because operating leverage is local — pricing, revenue management and marketing are metro-by-metro disciplines. Public Storage is betting its revenue-management stack travels.

Implications. This resets the arithmetic on what platform-level self-storage is worth versus what individual facilities trade for. For anyone marketing a portfolio to a public REIT, the OP-unit structure is the live lesson: a buyer with a strong currency can outbid an all-cash buyer without spending cash, and a seller who accepts units is making a call on the acquirer, not just the assets. Underwriters should price the earn-out as deferred equity issued above the current mark, not as a contingent liability at par.