PSA

Public Storage

Public Storage was organized in 1980. Effective June 1, 2007, we reorganized Public Storage, Inc. into Public Storage (referred to herein as “the Company”, “the Trust”, “we”, “us”, or “our”), a Maryland real estate investment trust (“REIT”). Our principal business activities include the acquisition, development, ownership and operation of self-storage facilities which offer storage spaces for lease, generally on a month-to-month basis, for personal and business use. We are the largest owner and operator of self-storage facilities in the United States (“U.S.”), and we have an equity interest in Shurgard Europe, a private company that we believe is the largest owner and operator of self-storage facilities in Europe and we have an equity interest in PS Business Parks, Inc. whose business activities primarily include the ownership and operations of commercial properties. At December 31, 2009, we operate within three reportable segments described below: (i) Domestic Self-Storage, (ii) Europe Self-Storage and (iii) Commercial.

The Domestic Self-Storage segment, at December 31, 2009, includes our direct and indirect equity interests in 2,010 self-storage facilities (127 million net rentable square feet of space) located in 38 states within the U.S. operating under the “Public Storage” brand name.

The Europe Self-Storage segment, at December 31, 2009, comprises our 49% equity interest in Shurgard Europe which owns 187 self-storage facilities (10 million net rentable square feet of space) located in seven countries in Europe which operate under the “Shurgard Storage Centers” brand name and manages one facility located in the United Kingdom that we wholly own.

The Commercial segment, at December 31, 2009, includes direct and indirect equity interests in approximately 21 million net rentable square feet of commercial space located in 11 states in the U.S., including our 41% ownership interest in PS Business Parks, Inc. (“PSB”), a publicly traded REIT whose common stock trades on the New York Stock Exchange under the symbol “PSB” (see “Investment in PSB” under “Equity in Earnings of Real Estate Entities” included in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” below for further information regarding our investment in PSB). This commercial space is primarily operated under the “PS Business Parks” brand name.

Certain other activities, due to their insignificant scale and dissimilarity in operating characteristics to our existing segments, are not allocated to any segment. These activities include (i) the reinsurance of policies against losses to goods stored by tenants in our self-storage facilities, (ii) the sale of merchandise at our self-storage facilities and (iii) management of self-storage facilities owned by third-party owners and entities that we have an ownership interest in but are not consolidated. We previously had truck rental and containerized storage operations, which we ceased operations in 2009.

We significantly increased the scope and scale of our operations on August 22, 2006, when we merged with Shurgard Storage Centers, Inc. (“Shurgard” and the merger referred to as the “Shurgard Merger”), a REIT which had an interest in 487 self-storage facilities located in the U.S. and an interest in 160 facilities in Europe. On March 31, 2008, we entered into a transaction with an institutional investor (the transaction referred to as the “Europe Transaction”) whereby the investor acquired a 51% equity interest in our European operations (“Shurgard Europe”). Shurgard Europe held substantially all of the operations in which we have an interest in Europe. Since March 31, 2008, we own the remaining 49% interest and are the managing member of Shurgard European Holdings LLC, a joint venture formed to own Shurgard Europe’s operations.

For all taxable years subsequent to 1980, we qualified and intend to continue to qualify as a REIT, as defined in Section 856 of the Internal Revenue Code. As a REIT, we do not incur federal or significant state tax on that portion of our taxable income which is distributed to our shareholders, provided that we meet certain tests. To the extent that we continue to qualify as a REIT, we will not be subject to tax, with certain limited exceptions, on the taxable income that is distributed to our shareholders.

We have reported annually to the SEC on Form 10-K, which includes financial statements certified by our independent registered public accountants. We have also reported quarterly to the SEC on Form 10-Q, which includes unaudited financial statements with such filings. We expect to continue such reporting.

On our website, www.publicstorage.com, we make available, free of charge, our Annual Reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after the reports and amendments are electronically filed with or furnished to the SEC.

Employees

We have approximately 4,900 employees in the U.S. at December 31, 2009 who render services on behalf of the Company, primarily personnel engaged in property operations. None of our employees in the U.S. are covered by a collective bargaining agreement. We believe that our relations with our employees are generally amicable.