page 1

NAREIT

Investor

Conference

Summary

of

Public

Storage/Shurgard

Merger

June

6-8,

2006

THE

MOST

RECOGNIZED

BRANDS

IN

SELF-STORAGE

SLIDE

PRESENTATION,

FILED

JUNE

6,

2006

Filed

by

Public

Storage,

Inc.

Pursuant

to

Rule

165

and

Rule

425(a)

under

the

United

States

Securities

Act

of

1933,

as

amended

Subject

Company:

Shurgard

Storage

Centers,

Inc.

Commission

File

No.

001-11455

Date:

June

6,

2006

page 2

Disclosures

Forward-Looking

Statements

This

presentation

contains

“forward-looking

statements”

within

the

meaning

of

Section

27A

of

the

Securities

Act

of

1933

and

Section

21E

of

the

Securities

Exchange

Act

of

1934.

All

statements

other

than

statements

of

historical

facts

included

in

this

presentation

are

forward-looking

statements.

All

forward-looking

statements

speak

only

as

of

the

date

of

this

conference.

Such

forward-looking

statements

involve

known

and

unknown

risks,

uncertainties

and

other

factors

that

may

cause

the

actual

results,

performance,

achievements

or

transactions

of

Public

Storage,

Shurgard

and

their

affiliates

or

industry

results

or

the

benefits

of

the

proposed

merger

to

be

materially

different

from

any

future

results,

performance,

achievements

or

transactions

expressed

or

implied

by

such

forward-looking

statements.

Such

risks,

uncertainties

and

other

factors

relate

to,

among

others,

difficulties

encountered

in

integrating

the

companies,

approval

of

the

transaction

by

the

shareholders

of

the

companies,

the

satisfaction

of

closing

conditions

to

the

transaction,

inability

to

realize

or

delays

in

realizing

the

expected

synergies,

unanticipated

operating

costs

and

the

effects

of

general

and

local

economic

and

real

estate

conditions.

Additional

information

or

factors

which

could

impact

the

companies

and

the

forward-looking

statements

contained

herein

are

included

in

each

company’s

filings

with

the

Securities

and

Exchange

Commission,

including

in

Part

II,

Item

1A,

“Risk

Factors”,

in

Public

Storage’s

Quarterly

Report

on

Form

10-Q

for

the

quarter

ended

March

31,

2006,

our

registration

statement

on

Form

S-4

filed

on

April

20,

2006,

as

amended

on

May

24,

2006,

and

our

other

Reports

on

Form

10-K,

10-Q

and

8-K.

The

companies

assume

no

obligation

to

update

or

supplement

forward-looking

statements

that

become

untrue

because

of

subsequent

events.

Additional

Information

This

presentation

does

not

constitute

an

offer

of

any

securities

for

sale.

In

connection

with

the

proposed

transaction,

Public

Storage

and

Shurgard

have

filed

a

preliminary

joint

proxy

statement/prospectus

as

part

of

a

registration

statement

regarding

the

proposed

merger

with

the

Securities

and

Exchange

Commission.

INVESTORS

AND

SECURITY

HOLDERS

ARE

URGED

TO

READ

THE

DEFINITIVE

JOINT

PROXY

STATEMENT/PROSPECTUS

AND

OTHER

RELEVANT

MATERIAL

WHEN

THEY

BECOME

AVAILABLE

BECAUSE

THEY

WILL

CONTAIN

IMPORTANT

INFORMATION

ABOUT

PUBLIC

STORAGE

AND

SHURGARD

AND

THE

PROPOSED

MERGER.

Investors

and

security

holders

may

obtain

a

free

copy

of

the

definitive

proxy

statement/prospectus

when

they

become

available

and

other

documents

filed

by

Public

Storage

and

Shurgard

with

the

SEC

at

the

SEC’s

website

at

www.sec.gov.

The

definitive

joint

proxy

statement/prospectus

and

other

relevant

documents

when

they

become

available

may

also

be

obtained

free

of

charge

from

Public

Storage

or

Shurgard

by

directing

such

request

to:

Public

Storage,

Inc.,

701

Western

Avenue,

Glendale,

CA

91201-2349,

Attention:

Investor

Relations

or

Shurgard

Storage

Centers,

Inc.,

1155

Valley

Street,

Suite

400,

Seattle,

WA

98109,

Attention:

Investor

Relations.

Public

Storage

and

Shurgard

and

their

respective

directors

and

executive

officers

may

be

deemed

to

be

participants

in

the

solicitation

of

proxies

from

the

shareholders

of

Public

Storage

and

Shurgard

in

connection

with

the

merger.

Information

about

Public

Storage

and

its

directors

and

executive

officers,

and

their

ownership

of

Public

Storage

and

information

about

Shurgard

and

its

directors

and

executive

officers,

and

their

ownership

of

Shurgard

securities,

is

set

forth

in

the

preliminary

joint

proxy

statement/prospectus

included

in

the

registration

statement

on

Form

S-4

filed

with

the

SEC

on

April

20,

2006

and

amended

May

24,

2006.

Additional

information

regarding

the

interests

of

those

persons

may

be

obtained

by

reading

the

definitive

proxy

statement/prospectus

when

it

becomes

available.

This

communication

shall

not

constitute

an

offer

to

sell

or

the

solicitation

of

an

offer

to

sell

or

the

solicitation

of

an

offer

to

buy

any

securities,

nor

shall

there

be

any

sale

of

securities

in

any

jurisdiction

in

which

such

offer,

solicitation

or

sale

would

be

unlawful

prior

to

registration

or

qualification

under

the

securities

laws

of

any

such

jurisdiction.

No

offering

of

securities

shall

be

made

except

by

means

of

a

prospectus

meeting

the

requirements

of

Section

10

of

the

Securities

Act

of

1933,

as

amended.

page 3

Merger Terms

page 4

Terms of Merger

•

Each

share

of

Shurgard’s

common

stock

will

be

exchanged

for

.82

shares

of

Public

Storage’s

common

stock

–

No

caps

or

collars

on

share

exchange

–

Issue

approximately

38.7

million

common

shares,

assume

$1.9

billion

of

Shurgard

debt

and

$136

million

of

Shurgard

preferred

will

be

redeemed

prior

to

closing

–

One

Shurgard

independent

director

to

join

Public

Storage

Board

of

Directors

•

Structured

as

a

taxable

transaction

–

Step

up

in

tax

basis

of

properties

enhances

future

free

cash

flow

retention

•

Merger

targeted

to

close

during

the

third

quarter,

2006

•

Subject

to

shareholder

votes

and

customary

closing

conditions

page 5

Combined Company and

Portfolio

page 6

2005 Combined Revenues and NOI

($ in millions)

(1)

Before minority interest and depreciation

(2)

PSA and SHU owned properties as of March 31, 2006

(3)  Includes reclassification adjustments made to certain SHU historical amounts to conform to PSA        

presentation as filed in S-4 amendment on May 24, 2006

Combined

Pro Forma

Company

PSA

SHU

Combined

3

Percent

Revenues

U.S.

$1,061

$357

$1,422

92%

Europe

-

127

127

8%

Total

$1,061

$484

$1,549

100%

Property NOI

1

U.S.

$666

$204

$872

95%

Europe

-

42

42

5%

Total

$666

$246

$914

100%

Operations Footprint

2

1,508 facilites

642 facilities

2,150 facilities

(158 in Europe)

(158 in Europe)

37 states

21 states

38 states

-

7 European

7 European

-

countries

countries

92 mm sq ft

39 mm sq ft

131 mm sq ft

-

(8 mm sq ft in Europe)

(8 mm sq ft in Europe)

2005

page 7

Competitive Landscape –

U.S.

1

Net Rentable

Number of

Square Feet

Properties

(million sq ft)

1

Public Storage / Shurgard

1,992

123

2

Extra Space Storage

634

48

3

U-Haul

1,000

33

4

U-Store-It

339

21

5

Sovran Self Storage

290

18

(1) Public Storage and Shurgard owned properties as of March 31,

2006.

Competitor’s information based on data disclosed on website or in public filings.

page 8

Competitive Landscape –

Europe

1

1

Shurgard Europe

158

Belgium, France, Sweden, UK,

Netherlands, Denmark,

Germany

2

Safestore / Spaces / Une piece en plus

104

UK, France

3

Access Self Storage

44

UK

4

Big Yellow Self Storage

44

UK

5

City Self Storage

29

Denmark, Czech Republic,

Italy, Norway, Spain, Sweden

6

Lok'n Store

20

UK

7

Homebox

16

France

Other Operators

332

Industry

747

Number of

Properties

Countries

Served

(1)

Shurgard owned properties as of March 31, 2006. 

Competitor’s information based on data disclosed on website or in public filings.

page 9

CA

313

52

NV

22

OR

24

14

WA

42

51

UT

7

AZ

15

22

ID

NM

CO

50

8

WY

HI

6

MT

TX

170

65

KS

22

OK

8

NE

1

SD

ND

MO

38

IA

MI

15

24

IL

100

23

IN

18

13

KY

7

AR

LA

10

ME

VT

WV

VA

42

36

TN

23

10

MS

1

AL

22

GA

71

18

FL

157

32

SC

25

15

OH

30

0

CT

14

DE

4

MA

19

MD:  44

11

NH

2

NJ:  48

7

RI

2

MI

15

28

OH

30

Combined U.S. Portfolio

Operations overlap

Public Storage alone

Shurgard alone

1,992 Domestic Facilities

1

(as of March 31, 2006)

Property

Count

Public

Storage

1,508

Shurgard

484

(1)

Public Storage and Shurgard owned properties as of March 31, 2006.

NY

49

11

PA

21

7

NC

25

41

MN

25

19

WI

16

page 10

Chicago

7%

San Francisco

7%

Dallas-Ft. Worth

5%

Houston

5%

New York

5%

Other

33%

Miami

4%

Wash DC

3%

Philadelphia

3%

Atlanta

5%

Sacramento

2%

Seattle-Tacoma

3%

Denver

3%

Tampa

2%

Minneapolis

2%

Los Angeles

11%

U.S. Portfolio -

Self Storage sq ft

1

(as of March 31, 2006)

Chicago

7%

San Francisco

6%

Dallas-Ft. Worth

5%

Seattle-Tacoma

5%

Houston

5%

Other

36%

Los Angeles

9%

Detroit

2%

Denver

2%

Minneapolis

2%

Philadelphia

3%

Charlotte

2%

New York

5%

Wash. DC

3%

Miami

4%

Atlanta

4%

Public Storage

Shurgard

Los Angeles

5%

San Francisco

5%

Chicago

5%

Other

29%

Detroit

6%

Charlotte

7%

Dallas-Ft. Worth

4%

Wash DC

4%

Atlanta

3%

Minneapolis

4%

Phoenix

3%

Houston

4%

Orlando

4%

New York

4%

Portland

3%

Seattle-Tacoma

10%

Combined

Over one million customers

(1)

Public Storage and Shurgard owned

properties as of March 31, 2006.

page 11

Denmark

8

Denmark

8

United

Kingdom

18

United

Kingdom

18

France

48

France

48

Germany

11

Germany

11

Sweden

22

Sweden

22

Belgium

19

Belgium

19

Netherlands

32

Netherlands

32

European Portfolio

1

(as of March 31, 2006)

Total Locations: 158

Total Rentable sq ft: 8,309,000

(1)

Shurgard owned properties as of March 31,

2006,  per first quarter 2006 10-Q filing.

page 12

European  Portfolio –

Self Storage sq ft

1

(as of March 31, 2006)

United Kingdom

8%

Netherlands

9%

Denmark

9%

Germany

17%

Belgium

3%

France

54%

United Kingdom

11%

Belgium

16%

Sweden

18%

Netherlands

23%

Germany

4%

Denmark

4%

France

24%

Same Store (123)

New Store (35)

United Kingdom

10%

Belgium

13%

Sweden

15%

Netherlands

20%

Germany

7%

Denmark

5%

France

30%

All Stores (158)

(1)

Shurgard owned properties as of March 31,

2006,  per first quarter 2006 10-Q filing.

page 13

Shurgard Merger Sources and Uses

1

•

Public

Storage

has

raised

the

capital

to

fund

the

merger

costs,

payoff

SHU’s

short-term

debt

and

redeem

SHU’s

preferred

stock.

Merger Funding

(1)

Per information filed in S-4 amendment May 24, 2006

(2)

Unsecured credit facility balance of $621M at 3/31/06 and $67M of notes payable at 3/31/06

Funding Sources

($ in millions)

%

Funding Requirements

($ in millions)

%

Common equity

3,177

$   

78%

Common equity

3,177

$    

78%

Cash

892

22%

Retirement of SHU debt²

688

17%

Redeem SHU preferred

136

3%

Transaction costs

68

2%

4,069

$   

100%

4,069

$    

100%

page 14

Combined Capitalization as of March 31, 2006

($ in millions, except share price)

(1)

Pro

forma

combined

company

uses

PSA’s

stock

price

and

pro

forma

shares

outstanding

to

calculate

combined

equity

market

capitalization

at

March

31,

2006

(2)

Pro

forma

includes:

payoff

of

SHU

unsecured

credit

facility

of

$621M

at

3/31/06,

payoff

of

SHU

notes

payable

of

$67M

at

3/31/06,

issuance

of

$518M

of

PSA

preferred

stock,

redemption

of

$136M

of

SHU

preferred

stock

and

issuance

of

$100M

of

PSA

preferred

units.

Post merger, the combined company will still have one of the

most conservative capital structures in the REIT industry

Pro Forma

PSA

SHU

Combined

2

Share Price (close at 3/31/06)

1

81.23

$       

66.63

$          

81.23

$        

Common Shares (in millions)

128.2

47.3

166.9

Equity Market Capitalization

10,414

$     

3,152

$          

13,557

$      

Debt

142

1,943

1,413

Preferred Stock

2,603

136

3,121

Preferred Units

225

-

325

Minority Interest

33

139

172

Total Capitalization

13,417

$     

5,370

$          

18,588

$      

Debt  / Total Capitalization

1%

36%

8%

Debt + Pref. / Total Capitalization

20%

39%

24%

page 15

Strategic Rationale

page 16

Strategic Rationale

•

Highest quality, best located portfolio complimentary to PSA’s

portfolio

–

Best

opportunity

to

drive

“economies

of

scale”

in

operations

•

Opportunity to acquire large competitor in all stock, taxable transaction

–

Significant increase in depreciable assets

–

Significant

increase

in

market

presence

in

several

high

barrier

to

entry

markets

•

General & Administrative costs reduced significantly

–

PSA: 2% of revenues vs. SHU 7% of revenues

1

–

Eliminate redundancies in back office and executive infrastructure

–

SOX compliance and audit cost will be substantially reduced

•

Operating cost per facility could be reduced

–

Domestic Same Store NOI margin: PSA 67% vs. SHU 60%

2

–

Significant number of facilities in the same markets will further enhance economies of scale

•

Revenues could be enhanced

–

Occupancy: PSA 91% vs. SHU 86%

3

–

Participation in national media and promotional programs

•

Largest and best platform in Europe

–

Most properties are newly developed and of high quality

–

Opportunity to drive top line revenue through application of U.S. marketing, pricing and

promotional programs

–

Opportunities to improve economies of scale, customer awareness in many markets

(1)

2005

G&A

/

total

revenues:

PSA

total

revenues

of

$1,061M

and

G&A

of

$21M,

SHU

total

revenues

of

$484M

and

G&A

of

$35M

(2)

2005

Same

Store

NOI

(after

direct

and

in-direct

costs)

/

total

revenues:

PSA

total

revenues

of

$811

and

NOI

of

$543M,

SHU

total

revenues

of

$329M

and

NOI

of

$196M

(3)

2005

full

year

Same

Store

occupancy

page 17

General & Administrative Expenses

1

($ in millions)

SHU G&A costs can be reduced or eliminated

$17

$19

$21

$18

$33

$35

$0

$20

$40

2003

2004

2005

PSA

SHU

6%

Rev

8%

Rev

7%

Rev

2%

Rev

2%

Rev

2%

Rev

$22.7 million of G&A costs is expected to be eliminated

SHU G&A costs ($millions)                                 2005 

Executive and personnel expenses

Audit and consulting fee (including

Sarbanes-Oxley compliance costs)

Other costs of being a public company

Total SHU G&A costs

$  9.5

9.4

3.8

$  35.3

Potential synergy cost savings

Total potential synergy cost savings

2

22.7

Europe

Other miscellaneous costs

3.6

9.0

(1)

Per PSA and SHU 2005 10-K filings.

Calculated

G&A

/

total

revenues:

PSA

total

revenues

-

2003

$894M,

2004

$959M,

2005

$1,061M;

SHU

total

revenues

-

2003

$298M,

2004

$424M,

2005

$484M

(2) As filed in amended S-4, May 24, 2006

page 18

Domestic Same Store Operating Margins

1

•

Duplicative Yellow Pages costs can

be significantly reduced

•

Television advertising costs will be

allocated over a larger number of

properties

•

Duplicative support service costs

will be reduced or eliminated

–

Human Resources

–

Payroll processing

–

Accounts Payable

–

Cash Management

–

Insurance

–

Property Tax Management

–

Accounting and Income Tax

–

MIS function

65.3%

65.6%

67.0%

61.1%

60.5%

59.6%

0%

25%

50%

75%

2003

2004

2005

PSA

SHU

Each 100 basis point improvement in SHU’s

domestic

Same Store margin contributes $3.2 million in annual cash flow

(1)

Domestic Same Store: NOI (after direct and in-direct) / total revenues:

PSA NOI -

2003 $480M, 2004 $507M, 2005 $543M

PSA total revenues -

2003 $735M, 2004 $773M, 2005 $811M

SHU NOI –

2003 $168M, 2004 $187M, 2005 $196M

SHU total revenues –

2003 $275M. 2004 $309M, 2005 $329M

page 19

Domestic Same Store Sq Ft Occupancy

1

•

SHU’s

occupancy levels can

be enhanced with the aid of

PSA’s

marketing efforts,

national reservation center

and centralized pricing

programs

•

Opportunity to enhance

revenues by incorporating

PSA’s

tenant reinsurance and

truck rental programs into the

SHU’s

portfolio

89.2%

91.0%

91.0%

83.0%

84.0%

86.0%

60%

80%

100%

2003

2004

2005

PSA

SHU

Each 100 basis point improvement in SHU’s

domestic Same Store occupancy,

at constant rental rates, increases annual revenues by $3.7 million

(1)

Per PSA and SHU 2005 10-K filings.

page 20

Business Plan

page 21

Business Plan

•

Rebrand

all domestic properties to Public Storage and use PSA

operating platform

•

Maximize revenue growth

–

Strive to improve occupancy levels to those experienced by PSA

–

Centralize pricing at corporate level

–

Utilize national call center

–

Expand usage of internet and website to attract customers more efficiently

–

Centralize marketing and real estate at corporate level

•

Drive economies of scale benefits

–

Use television with no incremental costs for properties in same markets

–

Combine Yellow Page promotions for properties in same markets

–

Streamline field supervision functions

–

Eliminate duplicative back-office support functions

•

Meaningful benefits not expected until 2007

page 22

Long-term Financing Plan

•

Capital structure

–

Use preferred stock and retained cash as sources of permanent

capital to repay debt assumed in the merger and future growth

opportunities

•

Shurgard debt assumed

–

Refinance where possible with permanent capital

•

Goal is to quickly recapitalize Public Storage’s balance sheet,

positioning it for continued growth