02:48 PM EDT, 08/04/2025 (MT Newswires) -- Extra Space Storage ( EXR ) expects the storage market recovery to be slower than anticipated in 2025, pushing hopes for a stronger recovery into 2026, RBC Capital Markets said in a note on Monday.

The company narrowed its 2025 core funds from operations outlook range as underlying same-store growth drivers remain unchanged at the midpoint, though the pace of recovery was partially offset by higher tenant insurance and management fees, according to the note.

New lease rates showed positive growth for the first time since Q1 2022, but due to low tenant turnover, revenue impact will take time to materialize, with potential for a larger boost in Q4, RBC added.

The firm said that markets like Boston, Chicago, the Mid-Atlantic, and the Pacific Northwest are outperforming, while Sunbelt markets are still recovering.

RBC reduced its price target on Extra Space's stock to $148 from $160 with a sector perform rating.

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