CubeSmart exits the first half of the year with a self-storage portfolio that has stopped bleeding occupancy and started compounding modest rent growth again, the operating state every REIT shareholder hopes for at this point in the cycle. The thesis rests on three drivers that interact rather than compete. Same-store revenue growth has shifted from negative to a thin positive reading. That improvement was achieved through realized rent per occupied square foot expansion rather than aggressive mark-to-market on a fragile occupancy base. The capital allocation playbook has tightened visibly, with a fresh Heitman joint venture monetizing fifteen wholly-owned stores at an agreed value of $197.0 million. A credit facility upsize to $1.0 billion and an active share repurchase program create a self-funding loop between asset sales and per-share accretion. The third driver is balance sheet quality, which has continued to improve even as the average outstanding debt balance ticked up to $3.51 billion against a 3.33% weighted average effective rate.
The quarterly print itself is genuinely mixed and that mix is the story. Reported diluted earnings per share of $0.39 is up 8.3% year over year. FFO, as adjusted, per diluted share of $0.63 is down 3.1%. The decline reflects a falling share count and amortization tied to recent acquisitions rolling off the income statement. Net income of $89.5 million is the cleanest GAAP summary of value created during the quarter. Total revenues grew to $286.5 million. Property operating expenses rose 7.9%, faster than revenue and compressing same-store NOI by 0.7%.
Same-store revenues still rose 0.8% during the same period. Period end occupancy of 91.0% is flat with the prior year. Average occupancy of 90.4% trails last year, a narrowing gap that suggests the back half has more operating tailwind than the front half. Management raised the midpoint of full-year same-store revenue and FFO guidance. The per-share FFO band held steady at $2.54 to $2.60. Diluted EPS guidance of $1.58 to $1.64 anchors the GAAP story. The second-half cadence depends on closing the Heitman transaction and holding operating expense growth below 5%.
Same-store operational drivers in the back half center on three levers. The first is occupancy, where a 50 basis point pickup would translate into roughly $4.5 million of incremental same-store NOI over a full quarter. The second is realized rent per occupied square foot, which closed the second quarter at $22.34, up 0.7% year over year. Continued pricing power in high-barrier coastal markets would lift that figure toward $22.60. The third lever is expense normalization, where the second quarter same-store expense growth of 4.4% needs to compress toward 3.5% by year end. The base case lands near $2.57 of FFO per share, reflecting an outcome where occupancy and pricing improve at a measured pace without operational surprises.