Sovran Self Storage, Inc. (NYSE:SSS), a self-storage real estate investment trust (REIT), reported operating results for the quarter ended June 30, 2008.

Net income available to common shareholders for the second quarter of 2008 was $10.5 million or $.48 per diluted share. Net income available to common shareholders for the same period in 2007 was $7.4 million or $.36 per diluted share. Funds from operations for the quarter were $.84 per fully diluted common share; equal to that reported for the quarter ended June 30, 2007. Overall, the gains made from solid rental rate growth and control over operating costs were offset by a decline in occupancy in the Florida and Capital District markets.

During the quarter, the Company refinanced its near term debt maturities and repaid its line of credit with the proceeds of a $250 million term note, entered into a new Line of Credit agreement providing $125 million of unsecured financing, formed a joint venture to acquire and manage up to $350 million of storage properties, acquired the balance of its partner’s investment in Locke Sovran I, and sold its lone facility in Detroit, MI.

Kenneth Myszka, the Company’s President and COO, said, “We experienced a solid quarter as we again increased revenues and net operating income at most of our properties. Two areas negatively impacted our results – Florida and the Capital District. Without these 2 areas, our same store revenues rise from 1.2% to 3.9% and our same store NOI rises from 1.8% to 5.9%. Overall, our portfolio is in good shape and performing well.”

OPERATIONS:

Total Company net operating income for the second quarter grew 5.1% compared with the same quarter in 2007 to $31.9 million. This growth was the result of improvement in the operating performance of the Company’s core portfolio and the income generated by the 21 stores acquired mid 2007. Overall average occupancy for the quarter was 82.6% and average rent per square foot for the portfolio was $10.51.

Revenues at the 338 stores owned and/or managed for the entire quarter in both years increased 1.2% over the second quarter of 2007, the result of a 2.6% increase in rental rates offset by a 220 basis point decrease in average occupancy. Same store operating expenses increased 0.1%; as a result, same store net operating income improved by 1.8% over the second quarter of 2007. General and administrative expenses rose $397,000 over the same period in 2007; this is primarily due to increased expenses involved in operating 31 more facilities this year.

During the quarter, strong performance was shown at the Company’s Texas, Missouri, New York and New England stores. Stores in Florida, Arizona, Alabama and the Washington, DC markets experienced slower than expected growth during the quarter.

PROPERTIES:

During the quarter, the Company sold its storage facility just outside Detroit, Michigan for $7.4 million. A gain of $.7 million (which was not included in the FFO computation) was recognized on the sale. The Company has no remaining stores in that market.

In June, the Company formed a joint venture with an affiliate of Heitman, LLC (the “JV”) to acquire and manage up to $350 million of storage properties to be acquired from unaffiliated owners. In July, the JV purchased 21 properties at a cost of $144 million, and expects to acquire additional facilities in the coming months.

The Company is continuing its program of expanding and enhancing its existing stores. Twelve expansions were completed during the quarter at a cost of $15.9 million; ten additional projects are expected to be placed on line during the balance of the year, with another fifteen to be initiated and underway by year-end.

CAPITAL TRANSACTIONS:

During the quarter, the Company refinanced its near term maturities and repaid its line of credit with the proceeds of a $250 million four year term note. The Company then entered into a group of interest rate swaps, effectively setting the interest rate on the note at 5.97% through 2012.

The Company also entered into a new, three year Line of Credit agreement, which provides $125 million of unsecured financing at a rate of LIBOR plus 1.375%. The facility is expandable, at the Company’s option, to $175 million.

David Rogers, the Company’s Chief Financial Officer commented, “With the successful debt refinancing, expansion of our credit facility, and the formation of the JV, we had a pretty busy quarter. We’re well positioned to move forward with our plans to grow our portfolio and improve our stores.”

In June, the Company paid $6.1 million to acquire the balance of its partner’s interest in Locke Sovran I, LLC. The Company now owns 100% of that entity.

During the quarter, the Company issued 162,287 shares through its Dividend Reinvestment Program, Direct Stock Purchase Plan and Employee Option Plan. A total of $6.3 million was received, and was used to fund capital improvements.

The Company’s Board of Directors authorized the repurchase of up to two million shares of the Company’s common stock. To date, the Company has acquired approximately 1.2 million shares pursuant to the program. The Company expects such repurchases to be effected from time to time, in the open markets or in private transactions. The amount and timing of shares to be purchased will be subject to market conditions and will be based on several factors, including compliance with lender covenants and the price of the Company’s stock. No assurance can be given as to the specific timing or amount of the share repurchases or as to whether and to what extent the share repurchase will be consummated. The Company did not acquire any shares in the quarter ended June 30, 2008.

YEAR 2008 EARNINGS GUIDANCE:

The Company is anticipating conditions in most of its markets to become increasingly more competitive, and will utilize leasing incentives as well as increased advertising and aggressive marketing to improve occupancy. Because of these increased costs, the Company now estimates growth in net operating income on a same store basis to be approximately 1% – 2 ½% for the balance of the year.

The Company will continue to expand and improve its existing properties. The projected cost of these revenue enhancing projects is estimated at about $40 million in 2008, providing for up to 400,000 sq. ft. of additional premium space at as many as 40 stores.

For the next year at least, the Company plans to acquire stores on behalf of the recently formed JV. It expects to contribute $25 to $50 million as its share of the equity required to fund the JV. From time to time, the Company may acquire properties for its own portfolio or sell certain of its assets, but no such activity has been considered in providing guidance for the balance of 2008.

Funding of the JV contributions, acquisitions, and the above mentioned revenue enhancing improvements will be provided for the duration of 2008 primarily from borrowings on the Company’s line of credit.

General and administrative expenses are expected to increase moderately as the Company adds properties to the JV and enters new markets. These are expected to be offset by the realization of management fees from the JV.

At June 30, 2008, all of the Company’s debt is either fixed rate or covered by rate swap contracts that essentially fix the rate. Subsequent borrowings that may occur will be pursuant to the Company’s Line of Credit agreement at a floating rate of LIBOR plus 1.375%.

Management expects funds from operations for the third quarter of 2008 to be approximately $.86 to $.88 per share, and between $3.35 and $3.40 for the year 2008.

FORWARD LOOKING STATEMENTS:

When used within this news release, the words “intends,” “believes,” “expects,” “anticipates,” and similar expressions are intended to identify “forward looking statements” within the meaning of that term in Section 27A of the Securities Act of 1933, and in Section 21F of Securities Exchange Act of 1934. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward looking statements. Such factors include, but are not limited to, the effect of competition from new self storage facilities, which could cause rents and occupancy rates to decline; the Company’s ability to evaluate, finance and integrate acquired businesses into the Company’s existing business and operations; the Company’s ability to form joint ventures and sell existing properties to those joint ventures; the Company’s existing indebtedness may mature in an unfavorable credit environment, preventing refinancing or forcing refinancing of the indebtedness on terms that are not as favorable as the existing terms; interest rates may fluctuate, impacting costs associated with the Company’s outstanding floating rate debt; the regional concentration of the Company’s business may subject it to economic downturns in the states of Florida and Texas; the Company’s ability to effectively compete in the industries in which it does business; the Company’s reliance on its call center; the Company’s cash flow may be insufficient to meet required payments of principal, interest and dividends; and tax law changes which may change the taxability of future income.

CONFERENCE CALL:

Sovran Self Storage will hold its Second Quarter Earnings Release Conference Call at 9:00 a.m. Eastern Time on Thursday, August 7, 2008. Anyone wishing to listen to the call may access the webcast via the event page at www.unclebobs.com/company/investment. The call will be archived for a period of 90 days after initial airing.

Sovran Self Storage, Inc. is a self-administered and self-managed equity REIT that is in the business of acquiring and managing self-storage facilities. The Company operates 380 self-storage facilities in 24 states under the name “Uncle Bob’s Self Storage”^®. For more information, please contact David Rogers, CFO or Diane Piegza, VP Corporate Communications at (716) 633-1850 or visit the Company’s Web site at www.unclebobs.com.