Extra Space Storage Inc. Consolidated Balance Sheets (dollars in thousands, except share data) Assets: Real estate assets, net Investments in unconsolidated real estate ventures Cash and cash equivalents Restricted cash Receivables from related parties and ailiated real estate joint ventures Other assets, net Total assets Liabilities, Noncontrolling Interests and Equity: Notes payable, net Exchangeable senior notes, net Notes payable to trusts, net Revolving lines of credit Accounts payable and accrued expenses Other liabilities Total liabilities Commitments and contingencies Noncontrolling Interests and Equity: Extra Space Storage Inc. stockholders' equity: Preferred stock, $0101 par value, 50,000,000 shares authorized, no shares issued or outstanding Common stock, $0.01 parvalue, 500,000,000 shares authorized, 126,007,091 and 125,881,460 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively Additional paid-in capital Accumulated other comprehensive income Accumulated decit Total Extra Space Storage Inc. stockholders' equity Noncontrolling interest represented by Preferred Operating Partnership units, net of$ 120,230 notes receivable Noncontrolling interests in Operating Partnership Other noncontrolling interests Total noncontrolling interests and equity Total liabilities, noncontrolling interests and equity See accompanying notes. 35 December 31, 2017 7,132,431 70,091 55,683 30,361 2,847 163,724 7,455,137 3538497 604276 117444 94000 96087 81026 4531330 1560 2569485 33290 @53584) 2550551 159636 213501 119 2023507 7455437 $ December 31, 2016 6J70A47 79570 43558 13884 16611 167076 7091446 3013588 610514 117521 365000 101588 87569 4495080 1259 2566420 16J70 639557) 2544892 147,920 203,354 2596466 7091446 Extra Space Storage Inc. Consolidated Statements of Operations (dollars in thousands, except share data) For the Year Ended December 31, 2017 2016 2015 Revenues: Property rental $ 967,229 $ 864,742 $ 676,138 Tenant reinsurance 98,401 87,291 71,971 Management fees and other income 39,379 39,842 34,161 Total revenues 1,105,009 991,875 782,270 Expenses: Property operations 271,974 250,005 203,965 Tenant reinsurance 19,173 15 ,5 5 5 13 ,033 Acquisition related costs and other 7 12,1 1 1 69,401 General and administrative 78,961 81,806 67,758 Depreciation and amortization 193,296 182,560 133,457 Total expenses 563,404 542,037 487,614 Income om operations 541,605 449,838 294,656 Gain (loss) on real estate transactions, earnont from prior acquisitions and impairment ofreal estate 112,789 8,465 1,501 Interest expense (153,511) (133,479) (95,682) Noncash interest expense related to amortization of discount on equity component ofexchangeable senior notes (5,103) (4,980) (3,310) Interest income 3,801 6,148 3,461 Interest income on note receivable from Preferred Operating Partnership unit holder 2,935 4,850 4,850 Income before equity in earnings of unconsolidated real estate ventures and income tax expense 502,516 330,842 205,476 Equity in earnings ofunconsolidated real estate ventures 15,331 12,895 12,351 Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase ofjoint venture partners' interests 7 69,199 2,857 Income tax expense (3,625) (15,847) (11,148) Net income 514,222 397,089 209,536 Net income allocated to Preferred Operating Partnership noncontrolling interests (14,989) (14,700) (11,718) Net income allocated to Operating Partnership and other noncontmlling interests (20,220) (16,262) (8,344) Net income attributable to common stockholders $ 479,013 $ 366,127 $ 189,474 Eamings per common share Basic 15 3.79 $ 292 $ 1.58 Diluted 3 3,76 3 2.91 $ 1.56 Weighted average number of shares Basic 125,967,831 125,087,554 119,816,743 Diluted 134,155,771 125,948,076 126,918,869 See accompanying notes. 36 Extra Space Storage Inc. Consolidated Statements of Comprehensive Income (amounts in thousands) For the Year Ended December 31, 2017 201 6 2015 Netincome $ 514,222 $ 397,089 $ 209,536 Other comprehensive income (loss): Change in fair value of interest rate swaps 17,308 24,598 (4,929) Total comprehensive income 531,530 421,687 204,607 Less: comprehensive income attributable to noncontrolling interests 35,997 32,438 20,001 Comprehensive income attributable to common stockholders $ 495,533 $ 3 89,249 $ 184,606 See accompanying notes 37 Extra Space Storage Inc. Consolidated Statements of Cash Flows (amounts in thousands) Cash ows from operating activities: Net income 3; Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Amortization of deferred nancing costs Non-cash interest expense related to amortization of discount on equity component of exchangeable senior notes Non-cash interest expense related to amortization of premium on notes payable ('nmpen sation expense related to stock-based awards Gain on sale of real estate assets and purchase of joint venture partners' interests Gain on real estate transactions, earnout from prior acquisition and impairment of real estate Distributions from unconsolidated real estate ventures in excess of earnings Changes in operating assets and liabilities: Receivables from related parties and affiliated real estate joint ventures Other assets Accounts payable and accrued expenses Other liabilities For the Year Ended December 31, Net cash provided by operating activities Cash ows from investing activities: Acquisition of real estate assets Development and redevelopment ofreal estate assets Acquisition of SmartStop, net of cash acquired Proceeds from sale of real estate assets, investments in real estate ventures and other assets Change in restricted cash Investment in unconsolidated real estate ventures Return of investment in unconsolidated real estate ventures Purchase/issuance ofnotes receivable Principal payments received from notes receivable Purchase of equipment and xtures Net cash used in investing activities Cash ows from nancing activities: Proceeds from the sale of common stock, net of offering costs Proceeds from notes payable and revolving lines of credit Principal payments on notes payable and revolving lines of credit Deferred nancing costs Net proceeds from the issuance of 2015 exchangeable senior notes Repurchase of exchangeable senior notes Net proceeds from exercise of stock options Proceeds from termination of interest rate cap Purchase of interest rate cap Payment of earnout from prior acquisition Redemption of Operating Partnership units held by nonconrrolling interests Contributions from noncontrolling interests Dividends paid on common stock Distributions to noncontrolling interests Net cash provided by (used in) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of the period Cash and cash equivalents, end of the period 3 Supplemental schedule of cash flow information Interest paid 3 2017 2016 2015 514,222 397,089 8 209,536 193,296 182,560 133,457 12,289 12,922 7,779 5,103 4,980 3,310 _ (872) (2,409) 9,561 8,045 6,055 (69,199) (2,857) (112,789) (8,465) (1,501) 4,567 3,534 4,531 1,966 1,367 (1,436) (14,694) (2,981) (1,172) (10,515) 10,075 108 (5,631) 208 11,928 597,375 539,263 367,329 (653,185) (1,086,523) (349,897) (31,746) (23,279) (26,931) (1,200,853) 312,165 60,813 800 (16,477) 16,854 1,282 (17,944) (28,241) (3,434) 581 16,953 45,080 7 (26,429) (84,331) 44,869 42,785 (7,819) (4,968) (7,380) (369,556) (1,032,035) (1,625,664) 123,424 446,877 1,325,623 1,900,357 2,121,802 (1,088,679) (1,122,442) (1,313,570) (6,967) (17,486) (9,779) 563,500 (19,916) (22,195) (227,212) 1,266 1,444 1,542 1,650 (2,884) (4,600) (2,510) (506) 201 (393,040) (367,818) (269,302) (31,972) (30,997) (24,503) (215,994) 460,831 1,286,471 11,825 (31,941) 28,136 43,858 75,799 47,663 55,683 43,858 8 75,799 136,202 122,265 8 89,507