ATAX - Earnings call transcript Q3 2018 | Greystone Housing Impact Investors LP

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Operator

I would like to welcome everyone to America First Multifamily Investors L.P. NASDAQ’s Ticker Symbol, ATAX Third Quarter 2018 Earnings Conference Call.

During the presentation, all participants will be in a listen-only mode. After management presents its overview of Q3 2018, you will be invited to participate in a question-and-answer session.

As a reminder, this conference is being recorded. and third team, call. quarter ATAX, welcome you of ATAX to XXXX behalf its thank management and On earnings conference

Private this provisions results statements statements to made Litigation historical comments of could Such cause Securities risk conference forward-looking which future that of materially During not events the XXXX. from actual are statements. or and regarding uncertainties pursuant facts, differ Act are Safe are and ATAX, forward-looking the made the Harbor subject to to Reform are call, these

Forward-looking statements by similar use focus words the terms. expect, of other should, plan, can be and identified like may, intend,

You are made results today. materially projections from business, of economic, competitive, statements as cautioned regulatory implied or those or forward-looking expressed to only differ or could that by actual forward-looking speak other the date. ATAX in statements today's Change factors these cause

Executive to to your you call. would Chad I turn full will be Thank operating of documents please ATAX will ATAX you interest Commission. explained ATAX FD information advantage like want and which periodic base reports Chief measures, session. For is be may they that more and you and over beliefs but of do, may necessarily Internal question-and-answer factors its for non-GAAP discussion other during We take if the impact from informed. risks that detailed Regulation will and include and to you in make change, review upon Exchange the the encourage now ATAX. other and ATAX Securities this the not filed about Today's time-to-time business, Daffer, projections aware to under these participation SEC call expectations ATAX. Officer and the with by

You may sir. begin,

Chad Daffer

increases a CFO, top-line present rate questions. earnings to are the properties, improved Jade in sale In Beach, threats portfolio adjacent Apartments afternoon, years call. Federal forward Daytona assets leverage the in revenue offset Thank spread financial and the in XXXX. co-operation Park In unit of pursued at Partnership, the you, results. Partnership for sale of two I action of the raised December, and multi-family gain-on-sale, equity in and Market unit to In closed am the X.X% to the X.X% development properties short-term on construction the expenses by consolidate Allen, in million of a $XX.X development and on the located and owner forecast points ATAX’s an bonds. unemployment Partnership hourly results, Partnership the and is continues multi-family investment while meeting additional rehabilitation with This payoff since redemption recognizing economic XX% Partnership operating participants compression many borrowing cost present historical Market by to FOMC third by provide an occupancy attempt at of September, and property bonds. to quarter Lake property rate and eighth December mitigate Park of in FOMC of Funds invested and the basis FOMC Tennessee. located additional reducing to Forest Coventry cap-rate million Omaha, directly in both million of fixed assets. fund unemployment, at while XXXX of With demand Jade influence variable since XX%, The properties the XX%, time $X.XX the Apartments, management in to by Open a underlying while $XX.X XX Vantage across increased property loans of executed is Murfreesboro At NOI portfolio Fed The the targets Funds Committee of of markets. continued the invested in growth XXXX. mortgage Fed January revenue the increasing is X.XX%. revenue expansion housing this of rates by and rate rate the operations. expense loans of from Partnership This In contained the to X.X% to then Partnership increases strong the the $X.X QX. utilized additional ATAX of third properties, developments. XX%, resulting of affects rates forecasted management to by rental the Estimated XXXX, I'd the The three inflation. in in or Florida. would Vantage XXth to both Lake control, taking Nashville, welcome lowest in and year-over-year to increasing look of to wages near Apartments suburb for higher Vantage has Partnership quarter. XX the share Forest third XXth investment $X.XX XXXX. financial housing will mortgage we expansion most with employment development with at the available consolidated Norma. located time, like strategy this the culminating To-date, Craig the at have pleased management in commitments million quarter, I purchased XXX my your report has entities excellent increasing notable Vantage completion by of properties Partnership reposition entities in This Nebraska in XXX is few the transactions September, Partnership Craig will like fell afternoon average and quarter with to benefit the of revenue, to for of thoughts level cash to Good Partnership delivering rental wages, the its distribution. third to earning workforce full to by

Craig Allen

you, Chad. Thank

quarters, what like and statements. transactions I'd and activity sheet As the is, do and in balance done previous some the on we've highlight to significant key income

million mortgage date in to about quarter $XX.X million at of increase was compared total revenue of than occurred billion in XXXX increase total are and in two representing XXXX. $XX.X $X That about year all, are transactions revenue September transactions third a Mortgage in $X talk assets. XXXX, were assets year-to-date $XXX XXXX, seventh was totaled of There XXth of mortgage that September for At total $XX I'll million September that XX billion comprised quarter of comprised detail to and these about compared XXth basis, of bonds. during at is revenue revenue. we've represents an XX assets significant the and XX, the represents more revenue Total XX% the First bonds our states. bonds third exceeded XX% in $XX.X the total about XX% total slightly revenue million, more shortly. quarter quarter about consecutive a On quarter-over-quarter. million, to it

comprised XX.X% as totaling really on Significant XXXX, because the a $XX.X bonds assets of basis, and we Just ten XXXX, mortgage back bond about started a for to during three about transactions million. total revenue million percentage $XX XXXX, quarter, XX% mortgage revenue XX/XX was our then, had that pay-off XX, and had when bonds. on about were of redeem mortgage on redemptions revenue we always related go of and and revenue the our to portfolio growth that's bonds benchmark, year-to-date December mortgage we've in

currently own managed behalf, or our MF Our and MF on that million. we we properties are two approximately properties have Properties $XX totaling

The XX-XX bond. Lake that and property student property XXXX significant California and the Forest Paseo located mortgage the Jade the the Nebraska. transactions Housing the San income sale during Park us revenue were Student Diego, in two MF Lincoln, QX have the impacted in We on statement of property

Forest units Lake XXXX. owned we've since Jade since total mentioned, September the each this Chad in XXX late and on sale Park September closed of of As XXXX projects two and quarter. These

of it's is our just Is in No a go we mortgage approximately bit continue XX in on XX% entities. by XXth, equity we the fixed by had XX% the what this and call a fixed-rate do unconsolidated to continues like revenue accomplished we fixed in as for invest September we addition, the fixed million approximately rate investment on be by more present have Vantage XXth the rate to hedging and TEBS variable. fixed move sheet fixed-rate TEBS balance now nature almost it line fixed this, XX/XX, rate in to called an rate that a XXth TEBS product was and Freddie $XX on about and in our investment $XXX.X in have of continue started and XX% September this another Why which to of was in XX-year a interest remained ten call, and bonds, $XX which for units At from was transaction. of Vantage in credit. XXXX, debt an MXX transactions of we financing year, and we XX% of increased million. last us variable to been to of to acquisition In required million time, especially invested In this Mac that's debt back and locking that. rates we XXXX, more and variable of this when projects. years we side? effort little important had product. at XX AB you X,XXX In At time, represented September our December was debt fashion back talked with because to conference outstanding is Trust securitized term, XX transaction, term At MXX in to been our securitized the

So But talk our today. exposure period of we quarter rates we've and each about we've in rates. how previously interest moved interest Fed is mentioned insulated again, or as that rising XXXX and come the We Chad are rate what by may from rising to into time, of interest our cost a XX% fixed impact XX% of to borrowing. how back sensitivity

points given nothing where and months, look XX we a rates rising a that. to any response So quarter, shock for test and take look XXX in we take do a on we do basis we at each day

we've at CAD in and of million the is about of reported XXX basis XXth Over the and of that At $X.XX. rising impact $X.X rates points to the interest decrease �� we've September our impact a is past, you those XXXX, measured results. decrease CAD about

So If CAD. decrease back year, $X.X we September in or one $X.XXX again, XXXX, was we about are about million fairly look well-insulated. of our exposure XXth

come a $X.XXX we've negative $X.XX. negative a So from to

net fixed too. while income So as our by second, this do debt we've spread to first our hedging. in variable again, CAD and interest well again, through this of rate rate rate And we ways. interest number and in sensitivity, a improved converting rate do We our our increasing, interest

our Our interest swaps. rate interest rate Bank predominant and used rate the past, being with hedging two for swaps we interest caps source those have Deutsche interest rate is counterparty of in our

and hands then, approximately of third Bank disclosed as event $X,XXX. Deutsche the terminated XX-Q the and quarter, that ATAX the a with rate we subsequent with we've swaps our terminated cash changing to and in During we rate second net resulted no of in interest one swap interest net cash

Our per diluted unit $X.XX, total On $X.XX year for compared per income basic to QX to and net a for our year-to-date income XXXX per per ago. unit basis, net unit, unit a ago. $X.XX a year $X.XX is compared was

During PHC impairment the on and $XXX,XXX instruments. we've On Trust million Investments. took $X.X taken our impairment we quarter, an basis, additional permanent on those year-to-date about a

that and cash rates net for At value. fairly and by two preceding over or with we our and compared September XXXX, Little to tremendously unit that, available record underlying was as year well value marks unit, year or this we we same per quarter quarter-to-quarter. can increase or final per XXXX, influenced value, happy ago then, to every $X.XX bit from a and of the which is take be $X.XX like reported in talk decrease too. but it for Chad asset comments about to value as net turn XX, any somewhat that would $X.XX we your year-to-date on $X.XX per unit, with total ago. basis book consistent compared similar be questions. period And Our I'd quarters to to value the again, finally, QX net CAD our a our distribution a than And different book $X.XX

Chad Daffer

Craig. Thank you,

we've quarter some third we've offset environment, the in with the foresee lens flat originations of looking our I the that originations the in I years been interest think, transpiring our increase, through of efforts and last of and to a into we've increase yield like made business think curve, capital rising we've seen rate the deployment our past from year development events going here quarter. XXXX. similar here I that's this the of seen

profile Our credit strong. remains

and like we execution of has see in for would and At that time, many we many, we this I to continue our think, our disciplined will credit to take the discipline in been projects capital. underwriting questions. deployment years consistent be

Operator

Walrod first from instructions] of David comes question Our [Operator JonesTrading.

open. is line Your

David Walrod

Good everyone. evening,

Chad Daffer

Good afternoon, David.

David Walrod

rate Wanted originate to to, revenue your I thoughts environment in new picture the ability broad on, bonds? mortgage rising guess, a get and source

Chad Daffer

this on bit, David. touched little We a

class of staying have accept each are on being that the I I and for followed rental very quarter. deals think, on assets think, these at forward-going both continue and to the underwriters we Jade obviously, not see asset on basis of underwriting number challenging probably for dozen and rate much couple borrowers partners We've a Forest the of made to debt this borrower and are pretty seen compress QX. last I will queue disciplined. asset becoming the assumptions the that, That's have therefore you quarters. the the we for increase underlying an so, of acquisition Park, remain we half for seeing seen achievements the here think, accept that valuations We internally as class. continue made either we've for we assets with will time that stay the seen a to spreads over a increased expenses. are buyers and high cap times have continue we When rates environment couple in their our very study years, deals rates capital [ph] by which that are eight that deals constant, assumptions to equity that or case Lake The sale of with and doing we've high, assumptions fee-simple leaving underwrite operating

here, in were our XXX class. GSEs we've – that plus Some know, at over think forward. not year out doing ago. of the those a asset going depending close, board may our or how the pan may I are But down on originations they tens competitors, I deals across

trying the interest right We some for order up That eat are not underwriting. our to to the seeing at that disciplined approach. now quotes work. deals at ATAX right make in XXX increase of be over may It's approach and rate us

with to disciplined definitely in But continue decrease execute. yield environment. originations opportunities the haven’t flat we'll the themselves, seen as stay and we rising a we'll present forward So curve interest our rate going in

David Walrod

multi-family assets? continue about are you Okay, going properties. that's And can helpful. we to those you think sell then, forward? What down secondly, to Would are two look – that to to you going

Chad Daffer

continue to will evaluate them. We

real We focus we think, need have portfolio - the other in I you two multi-family that have to is, portfolio. housing on as our estate well

that We Vantage assets highest also through coming the best to and evaluate continued for stabilization the what's have long-term. those have assets are and use we

for the portfolio to evaluate continue the but the only possible portfolio, not sales fee-simple Vantage MF So, future. also in

David Walrod

much. Okay. Thank very you

Chad Daffer

David. you, Thank

Operator

comes Thank from you [Operator next instructions] question ValueForum. Ron of Our Lane

Your line is open.

Ron Lane

great Congratulations. Chad, quarter.

Chad Daffer

Thank you, Ron.

Ron Lane

am one know, I my quickly, We've original ValueForum. I of members spoken before you've spoken of Real advisor. with the

holdings have that, to The with we of everyone your largest or group million maybe the and we I up that were and of with comes sustain at is, slightly to are least of our maybe lot – return but well with and better, which with have your we a different of on that make issue some capital ATAX money increased good to getting quarters. quarters, of second or even retire distributions for other sustainable for else quarter and that's ready with one that members year have good retirees Most thing you always philosophies companies they membership are who takes and not of The over we the all major some great soft continue not that income folks and over ATAX, of $XX with selling, quarters soft that is close Different My math am shows members. million our – $XXX a retail everything place. capital. have dividends. confident hopes that XXX has people. value dividends you'll see to investing on We preservation to guys. investors. Otherwise, a if with you, are are protecting

they pretty to protect in, income. the got can't Some massive that's knee-jerk They've goes get price up. their back to because But reaction of retirees. then the and it

can So, bottom-line a be to consider we is, sustainable for the income most ATAX part, producer.

Chad Daffer

ask a in think, and same you've the the about to past, be that any reduction answer in is question as is dividend Ron, I continued discussions the and no. the of the has

three Our Board in we've covering - not got dividend. dividend way. the years This $X.XX discussed has about reducing the any of

with year-to-date quarter to go. earned $X.XX have We one

think, I would that you confident math for it the fourth the do that we'll we tell year. highly are

managing on feel our give us assets the sitting events in We does the investments. opportunities marketplace and that pass of us not are are comfortable we sidelines with to approach that making the the worthy

so, be I ever and to this at And continue been has that reduced, not a we time, long-term platform your distribution sustainable have to would think contemplated sir.

Ron Lane

three note. as side One owned question, a for quick you years. I've almost

I think, return there distribution? some ATAX When quarterly included last was return of some time capital a of in early year. on like the first the on was capital the dividend

Chad Daffer

On of an those have numbers have me. On XXXX. in the quarterly I front don't annual dividend, been dividend,

Ron Lane

Okay. not answer. I Thank try Appreciate will you. XXXX, the to…

Chad Daffer

your for support, you Thank Ron.

Ron Lane

Thanks.

Operator

in thank today’s Ladies you. your and gentlemen, conference. for Thank you participation

You wonderful Everyone a may day. disconnect. have

Greystone Housing Impact Investors (GHI) 9 Nov 182018 Q3 Earnings call transcript