Public Storage Reports Results for the Fourth Quarter and Year Ended December 31, 2012 and Increases Quarterly Common Dividend by 14% to $1.25 Per Share

Public Storage (NYSE:PSA) announced today operating results for the fourth quarter and year ended December 31, 2012.

Operating Results for the Three Months Ended December 31, 2012

For the three months ended December 31, 2012, net income allocable to our common shareholders was $209.5 million or $1.22 per diluted common share, compared to $164.2 million or $0.96 per diluted common share for the same period in 2011, representing an increase of $45.3 million or $0.26 per diluted common share. This increase is due primarily to (i) a $32.1 million increase resulting from foreign currency exchange gains and losses incurred in translating the value of our Euro-denominated loan receivable from Shurgard Europe into U.S. Dollars and (ii) improved property operations (see below).

Revenues for the Same Store Facilities (see table below) increased 4.9% or $18.9 million in the quarter ended December 31, 2012 as compared to the same period in 2011, due to higher realized annual rent per occupied square foot and higher occupancy. Cost of operations for the Same Store Facilities decreased by 5.9% or $6.2 million in the quarter ended December 31, 2012 as compared to the same period in 2011, due primarily to lower repairs and maintenance and on-site property manager payroll. Net operating income for our Same Store Facilities increased 8.9% or $25.0 million in the quarter ended December 31, 2012 as compared to the same period in 2011. Net operating income for our non-Same Store facilities increased $5.9 million in the quarter ended December 31, 2012 as compared to the same period in 2011.

Operating Results for the Year Ended December 31, 2012

For the year ended December 31, 2012, net income allocable to our common shareholders was $669.7 million or $3.90 per diluted common share, compared to $561.7 million or $3.29 per diluted common share for the same period in 2011, representing an increase of $108.0 million or $0.61 per diluted common share. This increase is due to (i) improved property operations (see below), (ii) a $19.6 million reduction in distributions to preferred shareholders due primarily to lower average coupon rates, and (iii) a $16.2 million increase resulting from foreign currency exchange gains and losses incurred in translating our Euro-denominated loan receivable from Shurgard Europe into U.S. Dollars, offset partially by (iv) a $36.3 million decrease due to the application of EITF D-42 to our, and our equity share of PS Business Parks, Inc.’s (“PSB”), redemptions of preferred securities.

Revenues for the Same Store Facilities (see table below) increased 4.9% or $74.3 million in the year ended December 31, 2012 as compared to the same period in 2011, due primarily to higher realized annual rent per occupied square foot. Cost of operations for the Same Store Facilities decreased by 1.7% or $8.3 million in the year ended December 31, 2012 as compared to the same period in 2011 due primarily to lower repairs and maintenance and media advertising. Net operating income for our Same Store Facilities increased 7.9% or $82.6 million in the year ended December 31, 2012 as compared to the same period in 2011. Net operating income for our non-Same Store facilities increased $20.0 million in the year ended December 31, 2012 as compared to the same period in 2011.

Funds from Operations

For the three months ended December 31, 2012, funds from operations (“FFO”) was $1.86 per diluted common share as compared to $1.50 for the same period in 2011, representing an increase of 24.0%.

For the quarter ended December 31, 2012, FFO was impacted by a foreign currency exchange gain of $11.4 million (compared to a $20.8 million loss for the same period in 2011) and a $12.0 million charge in applying EITF D-42 due to redemptions of preferred securities, including our equity share of PSB (compared to $3.5 million for the same period in 2011).

For the year ended December 31, 2012, FFO was $6.31 per diluted common share as compared to $5.67 for the same period in 2011, representing an increase of 11.3%.

For the year ended December 31, 2012, FFO was impacted by a foreign currency exchange gain of $8.9 million (compared to a $7.3 million loss for the same period in 2011) and a $68.9 million charge in applying EITF D-42 due to redemptions of preferred securities, including our equity share of PSB (compared to $32.6 million for the same period in 2011).

Our FFO was also impacted by impairment charges with respect to non-real estate assets, contingency accruals, our equity share of PSB’s lease termination benefits, and costs associated with the acquisition of real estate facilities; the per-share impact of these items are included as “other items, net” in the table below.

The following table provides a summary of the per-share impact of the items noted above (unaudited):

FFO is a term defined by the National Association of Real Estate Investment Trusts and generally represents net income before depreciation, gains and losses and impairment charges with respect to real estate assets. We present FFO because we, and many analysts, consider FFO to be one measure of the performance of real estate companies. We believe that FFO is helpful when measuring the performance of a real estate investment trust (“REIT”) because FFO excludes depreciation, which is included in computing net income and assumes the value of real estate diminishes predictably over time, while we believe that real estate values fluctuate due to market conditions and in response to inflation. FFO computations do not consider scheduled principal payments on debt, capital improvements, distributions and other obligations of the Company. FFO is not a substitute for our cash flow or net income as a measure of our liquidity or operating performance or our ability to pay dividends. Because other REITs may not compute FFO in the same manner; FFO may not be comparable among REITs. See the attached reconciliation of net income to FFO.

Property Operations – Same Store Facilities

The Same Store Facilities represent those facilities that have been owned and operated on a stabilized basis since January 1, 2010 and therefore provide meaningful comparisons for 2011 and 2012. The following table summarizes the historical operating results of these 1,941 facilities (122.5 million net rentable square feet) that represent approximately 93% of the aggregate net rentable square feet of our U.S. consolidated self-storage portfolio at December 31, 2012.

Investing Activities

During the three months ended December 31, 2012, we acquired ten self-storage facilities (761,000 net rentable square feet of self-storage space and additional space that we intend to convert into 220,000 net rentable square feet of storage space for an additional cost of $15 million), located in Florida (three), Georgia (two), California (two) and one each in Arizona, New York and Texas, for an aggregate acquisition cost of approximately $82 million in cash.

Capital Activities

On December 27, 2012, we redeemed three preferred series at par (6.250% Series Z, 6.125% Series A, and 6.180% Series D Cumulative Preferred Shares) totaling $362.5 million, recognizing $12.0 million in related EITF D-42 charges during the three months ended December 31, 2012.

On January 16, 2013, we issued our 5.20% Series W Preferred Shares for gross proceeds of $500.0 million.

At December 31, 2012, we had $133.0 million outstanding on our credit facility which was repaid in full on January 16, 2013 with proceeds from the issuance of our Series W Preferred Shares.

Distributions Declared

On February 21, 2013, our Board of Trustees declared a regular common quarterly dividend of $1.25 per common share which is an increase of $0.15 per share, or 14% over the previous quarter’s distribution. The Board also declared dividends with respect to our various series of preferred shares. All the dividends are payable on March 28, 2013 to shareholders of record as of March 13, 2013.

Fourth Quarter Conference Call

A conference call is scheduled for February 22, 2013 at 10:00 a.m. (PST) to discuss the fourth quarter ended December 31, 2012 earnings results. The domestic dial-in number is (866) 406-5408 and the international dial-in number is (973) 582-2770 (conference ID number for either domestic or international is 90166639). A simultaneous audio web cast may be accessed by using the link at www.publicstorage.com under “Company Info, Investor Relations, Upcoming Events.” A replay of the conference call may be accessed through March 8, 2013 by calling (800) 585-8367 (domestic) or (404) 537-3406 (international) or by using the link at www.publicstorage.com under “Company Info, Investor Relations, Webcasts.” All forms of replay utilize conference ID number 90166639.

About Public Storage

Public Storage, a member of the S&P 500 and FT Global 500, is a REIT that primarily acquires, develops, owns and operates self-storage facilities. The Company’s headquarters are located in Glendale, California. At December 31, 2012, the Company had interests in 2,078 self-storage facilities located in 38 states with approximately 132 million net rentable square feet in the United States and 189 storage facilities located in seven Western European nations with approximately ten million net rentable square feet operated under the “Shurgard” brand. The Company also owns a 41% common equity interest in PS Business Parks, Inc. (NYSE:PSB) which owned and operated approximately 28.3 million rentable square feet of commercial space, primarily flex, multitenant office and industrial space, at December 31, 2012.

Additional information about Public Storage is available on our website, www.publicstorage.com.

Forward-Looking Statements

All statements in this press release, other than statements of historical fact, are forward-looking statements which may be identified by the use of the words “expects,” “believes,” “anticipates,” “should,” “estimates” and similar expressions. These forward-looking statements involve known and unknown risks and uncertainties, which may cause Public Storage’s actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Factors and risks that may impact future results and performance are described from time to time in our filings with the Securities and Exchange Commission, including in Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011, Form 10-K for the period ended December 31, 2012 expected to be filed on or before March 1, 2013, our other Quarterly Reports on Form 10-Q and current reports on Form 8-K. These risks include, but are not limited to, the following: general risks associated with the ownership and operation of real estate, including changes in demand for our storage facilities, potential liability for environmental contamination, adverse changes in tax, real estate and zoning laws and regulations and the impact of natural disasters; risks associated with downturns in the national and local economies in the markets in which we operate; the impact of competition from new and existing storage and commercial facilities and other storage alternatives; difficulties in our ability to successfully evaluate, finance, integrate into our existing operations and manage acquired and developed properties; risks related to our participation in joint ventures; risks associated with international operations including, but not limited to, unfavorable foreign currency rate fluctuations that could adversely affect our earnings and cash flows; the impact of the regulatory environment as well as national, state and local laws and regulations including, without limitation, those governing REITs; risks associated with a possible failure by us to qualify as a REIT under the Internal Revenue Code of 1986, as amended; disruptions or shutdowns of our automated processes and systems; difficulties in raising capital at a reasonable cost; delays in the development process; and economic uncertainty due to the impact of war or terrorism. We disclaim any obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, new estimates, or other factors, events or circumstances after the date of this press release, except where expressly required by law.

Shurgard Europe Same Store Selected Operating Data

The Shurgard Europe Same Store Pool represents the 162 facilities (8.6 million net rentable square feet) that have been consolidated and operated by Shurgard Europe on a stabilized basis since January 1, 2010 and therefore provide meaningful comparisons for 2011 and 2012. These 162 facilities represent approximately 85% of the aggregate net rentable square feet of Shurgard Europe’s self-storage portfolio. Our pro-rata share of the operating results for these facilities is included in “equity in earnings of unconsolidated real estate entities” on our income statement.