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2021 PROXY STATEMENT HIGHLIGHTS

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1, 3, 5, 10 and 20-Year Total Shareholder Return as of December 31, 2020

UDR’s Absolute Return in Dollars ($ millions)

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193^rd Consecutive Dividend Paid

Our January 2021 dividend represented our 193^rd consecutive quarterly dividend paid. We are committed to returning value to our shareholders, and for 2020 we increased our dividend by 5.1%, and we have increased our dividend 5.1% annually over the past 3 years, 5.3% annually over the past 5 years and 7.2% annually over the past 10 years. Our dividend has increased in each of the last 11 years.

^(a) We present reconciliations of these non-GAAP financial measures to their most directly comparable GAAP measures, as well as additional information, in “Definitions” on page 109).

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Our Five Strategic Objectives

2) balance sheet strength,

3) portfolio composition,

4) accretive capital allocation, and

5) a strong, innovative culture with a focus on sustainability, leading to an investment for all cycles.

Below is a summary of our results categorized by objective:

A best-in-class operating platform that couples strong blocking and tackling with continued innovation is expected to drive operating margin expansion. Initiatives that better monetize our real estate, pricing our apartment homes more efficiently, and nurturing an operating culture that embraces accretive evolution are all repeatable competitive advantages that result in superior NOI growth over a full cycle.

Our balance sheet is safe, liquid, flexible, and capable of funding both internal and external growth opportunities. An investment-grade rating, well-laddered maturity profile, and access to liquidity from a wide variety of capital sources affords UDR efficient pricing of external capital, which serves as a competitive advantage.

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*We present reconciliations of certain non-GAAP financial measures to their most directly comparable US generally accepted accounting principles (GAAP) measures in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Apartment Community Operations” in our 2020 Annual Report, including reconciliations of net income/loss reported under GAAP to NOI, FFO, FFO as Adjusted and FFOA, as well as additional information about non-GAAP measures.

^(a) We present reconciliations of these non-GAAP financial measures to their most directly comparable GAAP measures, as well as additional information, in “Definitions” on page 109.

Our diversified portfolio across markets, price points, and product types is a differentiating factor, appeals to a wide renter and investor audience, provides for more markets to invest in and overlay our operating platform onto, and lessens volatility in long-term same-store growth, cash flow growth, and total shareholder return to deliver a full-cycle investment that generates both growth and stability.

UDR’s history of disciplined capital allocation has created significant value for stakeholders over time and is a function of our ability to consider cost of capital signals and leverage our well-rounded suite of available investment options. Our diversified portfolio allows us to seek returns where others cannot, and our willingness and ability to pivot toward the investment opportunity that generates the highest risk-adjusted IRR and the greatest earnings accretion is central to UDR’s capital allocation strategy.

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Our culture is achievement-based, goal-oriented, forward-thinking, and driven by innovation and technology. These principles support an empowered, merit-based structure that rewards strong financial results while also mandating accountability and respect for all. Our diversity, equity and inclusion initiative is designed to help assure continued high levels of associate engagement in the future. High associate engagement levels are one of the reasons it is possible for UDR to consistently deliver financial results, which in turn allow us to provide the tools our associates need to take advantage of career mobility, which helps generate long-term cash flow growth and total return to our shareholders, and deliver superior customer service to our residents. These accomplishments are achieved in concert with UDR being a responsible steward of the environment, a socially conscious corporate citizen, and a promoter of sound corporate governance.

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Environmental

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Social and Community Engagement

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Governance

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As described further within this proxy statement we regularly interact with our shareholders and other stakeholders, having had 517 total interactions with shareholders (representing 84.1% of our outstanding common stock), including 50 representatives of the stewardship or governance functions of 29 of our shareholders (representing 44.3% of our outstanding common stock), in 2020 and early 2021.  Set forth below are issues that are most commonly topics of discussion in such engagements and brief descriptions of what we have done to address them.

COVID-19

As with other businesses across the globe, the COVID-19 pandemic negatively impacted our business as well as our residents, associates, and communities in a wide variety of ways during 2020.  Addressing these impacts required targeted responses including measured and intentional actions to assist our residents and our associates with a focus on protecting, to the extent we could, the health and well-being of our residents and our associates.  

With respect to our residents, we enhanced our cleaning protocols and improved air quality protocols. To help address our residents’ mental wellness and foster personal engagement amidst social distancing requirements, we coordinated virtual social and entertainment opportunities such as trivia contests and cooking classes.  In addition, to assist with financial impacts we offered payment plans, as well as payment options such as payment by credit card or installment payments, while waiving associated fees.  We also created processes to assist residents in applying for applicable rent assistance programs.  Our Next Generation Operating Platform allowed us to expand the number of activities residents and prospective residents could accomplish in a self-service, no-contact manner at the time of their choosing, including the ability to make amenity reservations and log maintenance requests, among others.  We substantially increased the availability of self-guided tours and added the capability for virtual community tours, allowing a UDR leasing associate to virtually “walk” prospective residents around a community through on-line interaction.  

With respect to our associates, we sourced and provided personal protective equipment and provided additional cleaning supplies.  In addition, we offered additional paid time off for COVID-19 reasons, one-time financial bonuses, flexible work schedules, work-from-home optionality, vacation time buy-out programs, mental wellness programs, and other benefits that assisted our associates and their families in addressing COVID-19 challenges.  Senior management also communicated frequently with our associates (initially weekly and then less frequently) through Company-wide telephonic calls and virtual meetings and webinars. The goal wasmeeting, please vote as soon as possible to ensure that our associates understood howyour shares are represented.

By Order of the Company was addressing the challenges presented by the pandemic, and to provide an open forum where they could express concerns to or ask questions directlyBoard of leadership.  We did not furlough or layoff any of our associates due to COVID-19.Directors

Interaction between management and the board also increased.  Additional board meetings were held virtually during 2020 so that board members had a full understanding regarding what the Company was doing to address the impact of COVID-19 and could efficiently exercise their oversight responsibilities.  See page 45.  

Warren L. Troupe

Environmental, Social, and Governance (“ESG”)Corporate secretary

ESG remains a cornerstone of how we operate our business and invest our capital, not only because strong corporate citizenry is important to our stakeholders, but because focusing on it makes solid economic and business sense.April 4, 2024

Environmental - Sustainability/Climate Change​

Sustainability issues and climate change directly impact the long-term viability of our assets and the markets in which they are located. However, in our view “sustainable” does not end with widely utilized metrics such as resource conservation (e.g., electricity, water, and renewable energy usage, emissions, recycling efforts, etc.) and their associated cost savings, but also encompasses topics such as how our buildings impact our residents and the communities in which they are located. For example, we account for the “walk,” “public transit,” and “bike” scores of a community when making investment decisions, both on new developments and when acquiring operating assets to better assess these impacts.  While we have measured and considered various sustainability metrics for many years, in 2019 we began an effort to explicitly disclose our sustainability metrics, goals, efforts, and accomplishments. We also undertook the task of more formally reporting and disclosing these items to our stakeholders to provide them with a deeper understanding of our efforts.  In 2020 we released our second Corporate Responsibility Report, available on our website under “Corporate Social Responsibility/Corporate Responsibility Report”, which included enhanced disclosure including (1) Sustainability Accounting Standards Board (“SASB”) real estate specific disclosures with respect to energy management, water management, management of tenant sustainability and climate change adaption, and (2) Task Force for Climate-related Financial Disclosure (“TCFD”) focal points such as climate-related management, along with the Global Reporting Initiative (“GRI”) disclosures included in our inaugural report.  Our efforts resulted in UDR receiving a GRESB Public Disclosure rating of “A”, a disclosure score of 97, which was the highest within our GRESB determined comparison group, and an overall survey score of 83, which resulted in a “4 Star” designation from GRESB and our being named a top ESG performer among global real estate firms.  

We believe climate change related risks are growing in importance and in recognition thereof, in 2020 we engaged two third-party consultants to provide climate change risk data for each of our assets and all the markets in which we operate.  ​

In our property-level and market analyses, we assessed both long-term and event-driven climate change risk through variables such as heat stress, water stress, sea level rise, flooding risk, hurricane risk and earthquake risk.  We used these findings to segment our portfolio by relative “riskiness” to better focus our efforts on high-risk markets and communities that require further analysis.  Lastly, these risks are considered by our board as part of their oversight of enterprise risk management.  

The assessment results are also considered as we make decisions with respect to capital investments in our owned assets (for example, whether to “harden” an asset against sea level rise or xeriscape a property to conserve water) as well as market-level investment and divestment decisions (for example, markets or sub-markets in which to invest and markets that we may exit) within our portfolio strategy process.  We presented the results of such assessments, together with our strategy and plan surrounding climate change, to our board and engaged in extensive dialogue on the topic at board meetings throughout 2020. We intend to provide regular climate change risk updates to the board in the years ahead, so that they are fully informed of the risks we may face and can actively oversee such risks.  In 2020, the Company also engaged a third-party expert to present thoughts regarding climate change risks to management and the board.

Greenhouse gas emissions and carbon-footprint are important globally and are areas that we believe may be focal points for increased future regulation.  Accordingly, in 2020 we measured the Scope 1 and 2 greenhouse gas emissions at each asset in our portfolio.  Our aggregate Scope 1 and Scope 2 emissions are reported in our Corporate Responsibility Report.  These assessments, in addition to the planned incorporation of estimated Scope 3 emissions in 2021, will be updated annually to (1) enable evaluation of usage patterns over time, (2) allow us to monitor year-over-year emission reductions due to capital investments we have previously made, (3) allows us to measure progress against our GHG reduction goal set forth in the Corporate Responsibility Report, and (4) provide insight into how and where we can further lower our carbon footprint through additional energy conservation investments.  When evaluating existing properties for acquisition we also perform, as part of our due diligence process, site assessments and property condition assessments, the results of which, in part, are used to assess opportunities to improve building energy usage.   See pages 46 through 47.

Social - Human Capital

We have increased our disclosure of human capital related efforts in this proxy statement.  See pages 42 through 45.  Our associates and their collective engagement are a key driver of our success and ability to execute our strategic plan.  Accordingly, we emphasize hiring and retaining associates with necessary skills while also fostering a culture that encourages inclusion and innovation.  To ensure that we provide our associates the tools they need to succeed and drive our success, we have established a wide-ranging training program, which also fosters career mobility opportunities. In 2020, we enhanced the training available to our associates, both through a more robust set of mandatory learning modules as well as the expansion of our library of elective training courses.  Regarding UDR’s culture, in 2020, we updated our culture statement and launched an associate-facing website devoted to our cultural values to ensure our associates understand our values and have an opportunity to participate in their evolution.  Diversity, equity and inclusion (“DEI”) are also important in the hiring and retaining of associates and to our business generally.  Accordingly, beginning in 2020 and continuing into 2021, we are formalizing our DEI efforts and have created a committee dedicated to overseeing those efforts.  In addition, we have created a high-level DEI strategy and more focused implementation plan, both of which have been discussed with the board.  Pursuant to the plan, we retained a third-party consultant with the appropriate expertise to survey all UDR associates on DEI topics.  Our consultant then conducted focus groups with UDR associates at all levels of the Company to ensure we have the appropriate feedback and information to help guide our efforts.  Based on the results of the survey and focus groups, we are creating programs designed to specifically target and therefore strengthen our DEI efforts.  The results should also help us to create DEI-related goals against which we can measure our progress, which will be reported to the board at least annually.  Last, understanding that our associates’ mental well-being is important, in 2020 we created and distributed to all associates a brochure outlining mental health resources available to them under our benefit plans.  As further described below, we also include metrics in our short-term compensation program for the “Health of the Workforce” and for ESG/DEI.  In addition, we report to the board on human capital issues on a regular basis.

Governance

Similar to recent years, we made governance-related changes in 2020.  In October, Diane M. Morefield was appointed to the board, furthering our board refreshment efforts.  Thirty-three percent (33%) of our board is now comprised of female directors. In addition, in early 2020 our board formally adopted a “Rooney Rule” with respect to board refreshment and to enhance third-party led search efforts related to succession planning for the role of chief executive officer. While we have always considered board and senior officer candidates with a wide variety of backgrounds and traits, the explicit inclusion of this rule in our governance documents formalizes our efforts to increase diversity amongst our board and senior officer ranks.  

In addition, in early 2021 we adopted changes to certain of our governance documents including a change to the charter of the Governance Committee to provide that the Governance Committee will assess our disclosure of ESG matters, including reviewing any annual reports published with respect to such matters.  See pages 24 through 36.

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Compensation

Over time, we have enhanced the framework used to align short-term and long-term executive compensation with business results, including tying specific compensation metrics to our business plan. However, executive compensation remains a primary topic of conversation with our shareholders and other stakeholders each year.  In response to comments we have received, and in connection with the approval of the Amended and Restated 1999 Long-Term Incentive Plan (see Proposal No. 4), we are changing certain features of our incentive compensation plan in 2021.  These changes include replacing a “single-trigger” acceleration provision upon a change of control with a “double-trigger” provision and, generally, requiring all equity grants to have a minimum vesting period of 12 months.  Also, for 2021, we added an ESG/DEI metric to our short-term incentive program for senior officers, including our named executive officers, to tie a portion of their compensation to our results with respect to our ESG and DEI efforts.  The new ESG/DEI metric complements the Health of the Workforce metric added in 2019.  See discussion starting on page 48.

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Say-on-pay approved every year since it was first introduced in 2011; over the last five years, shareholder support for the vote on executive compensation has averaged 87%.

Focus on Variable Pay Linked to both Short-Term and Long-Term Performance

Focus on Performance-Based Compensation

Our focus on equity-based compensation, together with our robust CEO and executive stock ownership guidelines of 110,000 shares for the CEO and the President, 50,000 shares for any Executive Vice President and 20,000 shares for any Senior Vice President, assist in creating long-term alignment with our shareholders.

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Due to the high percentage of the compensation of our named executive officers that is variable and based on the performance of the Company, the effects of the COVID-19 pandemic negatively impacted the compensation earned by our named executive officers in 2020 (see page 57).

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Shareholder Engagement

In 2020 and early 2021, we had 517 interactions with our investors through meetings and property tours, representing ownership of approximately 84.1% of our outstanding common stock.  In addition, we proactively contacted the governance or stewardship departments of 110 of our investors and received responses from and had engagement meetings with representatives of 29 of such departments, representing ownership of approximately 44.3% of our outstanding common stock.

Proxy Access

The Company’s Amended and Restated Bylaws (“bylaws”) include a proxy access provision, which permits a shareholder, or a group of up to 20 shareholders, owning 3% or more of the Company’s outstanding common stock continuously for at least three years, to nominate and include in the Company’s proxy materials director candidates constituting up to 20% of the board.

Majority Voting

The Company’s bylaws specify a majority voting standard in uncontested director elections, which incorporates a director resignation policy for any director who does not receive the requisite vote.

Bylaw Amendment

Prior to our 2018 annual meeting, we reached out to shareholders holding approximately 74% of our outstanding common stock regarding a proposed amendment to our bylaws.  Following such discussions, we amended our charter and our bylaws to provide that a shareholder, or a group of up to 20 shareholders, owning 3% or more of the Company’s outstanding common stock continuously for at least three years, may propose binding amendments to our bylaws.  In order to implement the amendment to our bylaws we were required to amend our charter, which previously provided that our bylaws could only be amended by our board.  The amendment to our charter received the approval of 74% of the votes cast.  

Succession Planning

We remain focused on refreshing the membership of the board. Over the past seven years, we have added five new independent directors to the board, most recently including the addition of Diane M. Morefield in 2020, Clint D. McDonnough in 2016, and Mary Ann King in 2015.

To formalize our commitment to seeking diverse candidates for open board positions, in early 2020 our board adopted modifications to our Statement on Corporate Governance and our Nominating Committee Charter to enhance such documents by adopting a “Rooney Rule” specifically requiring that diverse candidates, based on gender and ethnicity, be included in the initial pool for any external search for director candidates and any external search for a Chief Executive Officer, and to further provide that any search firm used for conducting any such search is required to include such candidates in its initial pool of candidates.  While our board has always considered diverse candidates in such searches, these modifications formalize our continued commitment to diversity.

We also focus on the development of our executive management team.  Effective January 1, 2021 two Vice Presidents were promoted to Senior Vice Presidents and the titles and roles of other members of management were changed.  In 2019, the board appointed Jerry A. Davis to President – Chief Operating Officer and five Vice Presidents were appointed to Senior Vice President.  Further, over the three years ending December 31, 2020, 740 of our associates were promoted, building a deeper and more diverse associate pool.  Of associates that were promoted to the positions of community director or director, or a higher job classification, over such three year time period, 60% were female and 15% were of ethnic backgrounds other than White.

We have also formalized our efforts with respect to diversity, equity, and inclusion for the Company.  Our efforts have been discussed with our board and include formation of a committee dedicated to overseeing our efforts in this area, engagement of a consultant with expertise in the area to help guide our efforts, and an all associate survey to help identify potential areas of focus.

Lead Independent Director

In 2017, our board determined that it was appropriate to appoint our Chief Executive Officer and President, Thomas W. Toomey, as Chairman of the Board, and, in connection therewith, to appoint James D. Klingbeil as Lead Independent Director in accordance with our governance standards.  Such appointments were effective January 1, 2018.

Corporate Responsibility

Because of its importance to our stakeholders including our associates, residents and investors, we have made corporate responsibility a part of our culture.  Building on our efforts in 2019 and previous years, we had many successes in this area in 2020.  In 2020 we again reported to GRESB and based upon our submission we received a survey score of 83 and, for

PROXY SUMMARY

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This summary highlights selected information about UDR and the items to be voted on at the annual meeting. This summary does not contain all of the information that you should consider in deciding how to vote. You should read the entire proxy statement carefully before voting.

​Company Overview

​About UDR, Inc.

Meeting AgendaUDR is a $20 billion enterprise value multifamily REIT that owns, operates, develops and Voting Recommendationsredevelops a diversified portfolio of apartment homes across top-tier U.S. markets. Founded in 1972, UDR is an S&P 500 company that consistently generates strong total shareholder return through innovation, best-in-class operations and disciplined capital allocation across a wide range of opportunities. UDR’s strategy is founded on diversification across markets, price points, and product types which coupled with our best-in-class operations delivers a full-cycle investment that generates both growth and stability. As of December 31, 2023, we owned 188 communities including 60,336 homes and had 1,397 full-time and 13 part-time associates who worked to generate in excess of $1.6 billion of revenue in 2023.

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