Earnings call transcript Q4 2022

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Operator

Thank you for standing by. And welcome to the Independence Realty Trust Inc. Q4 Earnings Conference Call. My name is Sam, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call was an opportunity for questions-and-answers at the end. Instructions]. [Operator

the Lauren turn go Lauren, over ahead. call now Torres. to please I'll

Lauren Torres

good you full everyone. to you morning, Thank and Thank results. Realty fourth financial review Trust for quarter XXXX and year Independence us joining

webcast On the Scott Executive of People; Mike Officer; Today's IRT and today, and EVP Operations Chief Ender, Schaeffer, call Financial of Officer. Chief Daley, Farrell the on with at call me irtliving.com. are President Investor There be Jim call on Sebra, is available telephonically webcast of via today. and XX our website website, being approximately pm our Time a Relations will at replay beginning Eastern

Before I STAR. materially Steadfast reflect Apartment views and referenced with be Scott, may forward-looking with like turn statement events, be herein has the at respect made merger could to from substantially IRT's what to current future results call. to financial statement I'd remind on performance REIT, everyone forward-looking there and call projected. the will differ that this Actual IRT which over These

good with that made accuracy cause press Litigation harbor Securities our safe of Such expectations. XXXX. provisions for statements SEC future and our the to the to expectations Private faith Act information filings refer from supplemental results pursuant to those the release, of Please could IRT's affect materially the factors Reform or are of in differ

matters attached measures not are SEC herein this current IRT a supplemental the except financial on may non-GAAP link. this A IRT to is reconciliation available Investor required call. form call, forward-looking financial respect to X-L the financial be discuss as during available financial on update to through statistical non-GAAP under to law. IRT's with website report or measures also undertake comparable containing most by this statement described Relations. information and other IRT filings at does Participants information, IRT's GAAP information press of may release measure copy of direct other earnings and

pleasure to my to it's Schaeffer. that, call over Scott turn With the

Scott Schaeffer

a Lauren. full for and joining as Thank macroeconomic integrated you was during we year strong year all and morning. XXXX initial portfolio guidance operating you, for challenging IRT, a synergies STAR thank environment. And exceeded our us this the

nearly was result share FFO Our of positive of per continue the positioning XX% the non-gateway the where core demand portfolio our concentrated in to XXXX Sunbelt from deliver we strategic growth dynamics. to benefit ability markets within supply and region, in expanded

which fourth Our performance, year was results. team and year our quarter delivered another of full robust in reflected

double rental Specifically, in our revenue. a in increase supporting average rate XXXX, digit increased XX%

XX% full X.X increased and target. in guided effectively to fourth the for reduce year. year times end a NOI low-XXs store ahead year leverage at ago, of we to XX.X% EBITDA our same XXXX X.X the to last quarter from Our And our times year continue compared

We program, also the the value-added progress about guided more achieving renovations X,XXX properties for XXX renovated deliver we've landscape continue We in of economic units we X,XXX fourth units an as well made to full on return positions of while on meaningful the annual investment us XX%. This than and in our markets. quarter assess confident to program and determine the units the we X,XXX previously selected pace of potential XXXX. to remain that of scope the value-add and in and year, as

can is this gains to portfolio, we done and be assure While work that you a across coming top for priority in XXXX. there more entire year, drive up a the strong is occupancy to us recognize sustainable

improve leasing leasing of our all teams We regional leaders our aspects to are and on frontline process. focused and sales working with

will continue growth to we communities, where XX% As previously, non-value-add is rent appropriate. mentioned our for target we occupancy drive and

We're and in these to significant to Sunbelt job recession factoring the a shown half Despite of our migration NOI expect dynamic guidance, on uncertain pronounced more well markets of be XXXX, upon solid our growth growth. midpoint continue points XX.X% to which key deliver And growth cycles the in in are we at Looking outsized ahead, X.X% this see top all we NOI a XXXX. our positioned. XXXX we of that growth This of continues market XX.X% to build includes across foundation year. which mild portfolio our second of and in conditions to range. expect rates, footprint is as and in in being

at core midpoint. FFO X.X% XXXX guidance Our for growth the also includes shared

are a remain real resilient optimistic And strong our very as good and opportunities estate our excited IRT the future fundamentals year. remain markets. to off we start about in for We about this growth growth

executive, to like the the People. all member operations lead and to overseeing in with December of Daley, core XXXX. the Mike introduce is of now aspects our operations. has and and team through pandemic a our Mike of EVP to a day-to-day IRT Mike us is seasoned you IRT XXXX, performance. I'd returned strong successfully He been operational guided since Operations consistently

I'd With to the to Mike. like that introduction, call hand over

Mike Daley

to its Thanks, are provide time detail, and happy through different growth stable excited ability in we cycles. Scott. to I'm greater share our first about economic call for the join why today's portfolio and

like year. average Our were Atlanta, full and mid for double achieving rent with Durham, year quarter high-teens results increases Tampa, to the by and Myrtle strong Beach, digit fourth rent Raleigh driven end markets growth, Memphis,

not in after markets. continue the was Georgia experienced and into and our We have only states in North XXXX. also South Sunbelt growth March since migration Carolina, job confirmed Texas, net Bureau, with that This migration reported attractive and XXXX. over The but region, U.S. strong Florida, southern robust were market XX% the states recovery domestic situated a six pandemic see represent job trends averaging X% NOI the Tennessee by gains of Census IRT's to highest which recently the well are

QX seasonality. basis As driven are driving fourth at down in XXXX, from store Scott mentioned, part XX.X%, on average focused points occupancy by same we our occupancy was the quarter improved laser in total portfolio XX

value-add As XXXX XX every communities the started half we've in as portfolio also second previously today. of our store same through We occupancy, during renovations XX approximately for comes impacts of communities offline indicated, within the unit renovations our start days. on

also average the theme our we sales Improving below of occupancy during our stated and is confident increase XX.X% non-value-add leasing priority fourth for are of the our We previously was leasing a quarter our entire our And process XX%. during that target store targeted levels will communities occupancy opportunity. season. the recognize

begin renewals increase our that for to store increase and leases a XXXX. rental in pleased are positive rent as X.X% we note a XX, growth We same achieved On momentum X.X% with portfolio. we have February new combined seeing basis, blended through are we in a X.X% lease-over-lease

earn will X.X% XXXX lease across a have X%. contribute is We to our revenue loss in portfolio that to growth and the

to provide you call opportunities. our update Farrell, I'd now to like investment with on turn to an the

Farrell Ender

Mike. quarter, the list with our ongoing and properties four program. Thanks, program. We Starting to a under renovation renovations fourth result the of from value-add units complete completed XXX as in on our the

For on renovations rent unrenovated a of an the investment of done full units, on completed over costs. XX.X%. $XXX average renovated $XX,XXX with increase was X,XXX year we and average This return unit per an achieving of cost

XX value-add X,XXX properties we ongoing mentioned, XXXX. we As included program. our in to markets in between X,XXX units expect have Scott renovate Currently, in to XX

another XXXX at costs ROI these course an average X,XXX we of projects. on the comprising properties XX% add expect achieve plan to new units, of interior Over nine to and

the sold Terrace The program, blended recognize price ongoing properties Meadows million held-for-sale connection we communities. Louisville, quarter. Sycamore $XX and The dispositions Kentucky, net on on capital from In the recycling Apartments two cap was sale our previously Terre Haute, fourth with gain we X.X%. was $XX these sale Indiana. two these rate in in economic and in aggregate million

The one XXXX and of was built in the market. annual requires status, held-for-sale to to in spend other XXX We also unit communities a high moved in same community CapEx property relative a located our property Indianapolis. level

of the hard purchase. sale on month to of complete, be this is is deposit property a they buyers X.X%. is used debt. proceeds We and they're economic reduce end The rate with expect on Due debt using rate this close diligence disposition to the to finance the the at cap disposition from to this locked the

Regarding X.X% in projected following. [ph] new weighted of but based on X.X% our increase supply, declined CoSTAR deliveries in deliveries markets at XXXX, has the expected sub to exposure in are our new average the on years hold existing put in have declining potentially interest factors due to rates. XXXX, and as inventory, dropping triple elevated to been already further cost several included and many not increased projects construction of

overall our we construction with term, monthly housing meet and that expect Class to supply limited continue rents in select construction. XXXX, While the are this elevated new demand comparable Nashville new deliveries substantially Atlanta, have will impact will in will not with lower primarily communities, needs. submarkets than Longer expected B markets, in and Dallas, imbalance have Tampa

In Lastly, of projects next with larger million station committed first of anticipation continued phase of decade, I on course charging electric $X growth the program. the our EV one share XXXX. our like would capital vehicles our we're to of you over for

first of that be the expect usage believe the resident will used amenity. these rollout and demand understand continue and this to portfolio. The better charging following years stations to installing communities will at step throughout in stations XXX XX well We be of charging received

Jim. now call to like I'd over to turn the

Jim Sebra

the million, Good update, million the net Thanks, up to fourth common morning, XXXX, performance quarter XXXX Beginning everyone. available income Farrell. of $XX.X $XX.X XXXX. with was quarter fourth of in our for shareholders from

available income common shareholders million $XXX.X was year in net For full up $XX.X to full year from XXXX. XXXX, million, the

from quarter During to core to FFO year than ago grew share. FFO per million core $XX doubled share more $XX.X XX.X% and a $X.XX per the fourth million

our million portfolio year-over-year the core STAR per per and organic FFO year, XX.X% $XXX.X grew a share reflects This growth basis. throughout with growth For accretion grew share from XXXX. well earnings with the and to as rent associated core the full $XX NOI combined to during the sizable as $X.XX million FFO experienced merger on

a IRT the driven growth of rental same-store was X.X%. XX.X% by was NOI revenue growth growth This by XX%, in a rates. fourth average led our quarter increase in

increased same store year, of the For with full by growth rental XX%. NOI XX.X%, supported rates by revenue XX.X% growth IRT increasing

X.X% operating a side, by increased On the quarter, real repairs ago. expenses, higher IRT year property maintenance expenses and and while taxes expenses compared expense fourth estate operating led declined utility the to advertising in and costs same-store

same-store full estate For X.X%, expenses contract increases mostly services. and IRT operating grew insurance, in property real reflecting taxes year, the

continuing burden. higher technology products costs drive we to for help using out reduce continues the While and procurement are and roll efforts to services, to inflation efficiencies inflation

our sheet. balance to Turning

approximately of credit and As million. was liquidity $XX additional in $XXX unsecured XX, had unrestricted cash our for facility. position of capacity million our million We December $XXX

year-end Regarding continue debt-to-EBITDA net target times of ago progress down excited to we our year, and topic of year ongoing in the last X.X to at we from that make since a X.X low-Xs. XXXX significant ahead we announce leverage, are came ended of times

earlier, As target the our sale outstanding year-end upcoming mentioned Farrell our mid-Xs, XXXX. be us and Indianapolis property good used footing to repay to on will indebtedness in leverage proceeds for puts achieve of

uncertainty we and do in that the no XXXX. anticipate months, million we to macroeconomic While in I debt some coming only of maturities reiterate $XX maturities in XXXX have wanted

and sufficient will continue maturities facility. address our using have maintain We to credit unsecured to liquidity these

also to year-end hedges rate of fixed effectively XX% rate such rate of that outstanding our adequate as debt debt floating We debt. have that floating have converted is only a exposure that

FFO to $X.XX share. range our for to guidance EPS the per $X.XX of per core XXXX, And he outlook diluted our $X.XX range share. respect to is With for $X.XX in of in

This same-store X% an midpoint blended bad rate portfolio of X.X% earning of our debt expect and of average our XXXX, reflects for and XXXX, same-store signed and is occupancy revenue. leases in a guidance at the expense of revenue comprised rental of increase which For X.X%. of guidance, of to growth XX.X% all of a increase we X.X%, X.X%, NOI

real Moving expenses, non-controllable of and a same-store projected that inflationary insurance automation improve controllable operating the result taxes operating our is in midpoint on will expenses for increases XXXX. efficiencies to our throughout to including and our result implement we of the growth strategies estate And X.X% at our increase X.X%. continue and primarily expenses This centralization expectation increase will is X.X%. to various of expenses will

and As our midpoint, property relates management we expenses, an or general to it of administrative million at X.X%. increase guiding $XX.X to the are

by of during we merger our $XXX.X rates This of back the For is a X% interest increase expense, effects to that purposes. in an and midpoint the excluding we is of amortization premium related to are over driven a debt million for add XXXX STAR expected adjustment XXXX. [indiscernible] increase of entirely guiding floating

mitigating is average our the current effects hedged for debt is for example, For the either compared yield XX% of XXXX to increase. as curve XXXX. SOFR Remember of or an of fixed thereby X.X% X.X% this

the Regarding to but for this Indianapolis, are for volume, volume $XX our we guidance of and which later million expectations, disposition to held are assuming million, providing reflecting transaction expect we $XX not acquisition close investment in currently any sale asset month.

regarding CapEx, add guided million funded the in maintenance million CapEx during development and excess incremental midpoint we value-added flow in expend XXXX and And which CapEx and current ranges. lastly, $X.XX XXXX our non-return recurring $XX our in of $XX in generated expect at CapEx cash is These be each development million million primarily $XXX $XX our through after per quarter. will of dividend of paying value

Now, Scott, to Scott? the back I'll call turn

Scott Schaeffer

Thank you, Jim.

execute portfolio. growth As XXXX, for we positioned in invest ahead as strategy continued we we move well our in remain our and

renter withstand fundamentals, solid ability stems from to a build the IRT's uncertainty. macroeconomic been with confidence backdrop leading Our and markets has which able presence of to demand attractive

committed value capital fully are enhancing and our to shareholder regularly returning We shareholders. to

achieving to and forward with strengthening joining forward for presence the year our look speaking sector. our multifamily to targets Thank look and us another We you you in today again.

can you open for questions. a Operator, now call

Operator

Q&A line Austin of Absolutely, Our Wurschmidt now with first is we session. begin will Instructions] now your Austin, from question [Operator line comes open. today the KeyBanc. the

Austin Wurschmidt

everybody. on right you I'm morning, feel in your there and But good do you the all personnel appreciate and occupancy. on been Have have comments focus the stabilizing recent and Mike, other Scott the to moving Thanks pool? like place team? any operations really changing that around curious, worth a in non-value-add to has within do within order band changes tighter reacting on occupancy particularly, are a that the And conditions handle team quickly forward that keep you the market of kind highlighting? team to feel ramping

Scott Schaeffer

know. good Good, you Austin. Thanks, question. is as This Scott,

your way is start where the question we are. little we bit to of think best I with answer got to to how a

I We and too occupancy wasn't So, past, quarter. on in with the resident retention, which pushed our trends effect a to our ability in leases. rents the new sign as had negative I've said, fourth little hard, happy a our

changing, was market team The was and we our adapt. to -- were frankly, slow

the is the occupancy, one deliver with I've balancing multifamily so this we increases of of got in the side always rates of away lease REITs. importance good we can And that highest the the highest of frankly, But, number call On adding we had which time of rent increases the possible all going revenue. stressed that our that we we the occupancy. properties to increasing from value-add value-add in at formula. through a the And previously, that program were the this the happened same properties program, the significant has said on in has negative impact

in The we XXX quarter fourth points. to XX XX reduced that basis from units completed the overall occupancy

does an really effect. it So have

and her in the multifamily our forward leaders So experience senior Janice charge having make with track and we of operations. quarter, really years her with operations team look approval brought including we fourth just being in of We to changes platform, with and to in records XX our adding additional operations. some heads who Camden, proven decided Richards, on operating voice

We the of we XXXX. were the make the confident also, and our in prepared changes -- changes. slowest guidance, And leading into XXXX. fourth that we've we're can first we're XXXX from that during quarter changes, so competent made you leasing, into quarter see, these period I And we these headed to uncertain an wanted made as as the

I is think, pretty guidance Our strong.

process, we've on of behind the forward that relative market before changes our our focused so hold some and leasing will the a curve make the as STAR flow the We've we're we out all merger, made, rents, was team be it the opened changes. started list us, the were to put new to from to information pricing not leads. we we the right then had That's center the to going To that because that sure market on communities, of XX/X we've phone call -- capturing improved pricing integration. on

we properties have We've same expanded And we've sales REITs. is for that's special turnover. our training, think all where multifamily sales at The the professionals leasing on brought the I highest coaches.

sure So appropriately the now we but to that are continue were and coached, train are ready and we're they before making making thought And we you now sure we constantly to to do they them. have making are sure leasing.

technology ratio. And lead teams so us. conversion lease we're can to we how our a maximize work the to for our our streamline This improving focus that convert leads, is

have that season leasing as will of all we we sure non-value during XXXX. back done in then period, occupancy make again and to level We head again, that wanted sure to time changes up in these were want we to get And, XX% into wanted we add make here a slowest leasing communities. the had I to

I you. So hope your question answers that

Austin Wurschmidt

Yeah. the much But sort the were interacting highlighted? you the overriding that's provided vacancy you how that share impact there, previously. management to a maybe detail how impacting system the know, No, extent? And, in all I of some can guess redevelopment I guess, I pricing appreciate, you revenue or you how of frictional you

Scott Schaeffer

react. or more the fourth the description. up getting getting was team third there expiring. changed information. Well, team, quarter. you going even all of out And leases days rent bit last our right in review as market XX% The not advance of the I sure quarter tenants our XX our time and were not REITs if the overriding believe changed the And right, little a into letters pricing year. was we in slow increases, was mean, to to send it dramatically to are is think market all XX-XX it, about And the I'm I real

-- October-November in a to effect well. January expirations pricing leases So renewing were in here received slow we're market. frankly were has above January on react, the lease as back Because we that's forward renewals letters or

had left. impact So on occupancy. that negative And a people

much changes. position. we're in And I forward, a We made the going better saw it.

Austin Wurschmidt

me. alluded curious that to your assumption Jim, back for how plus provide occupancy Maybe that and I'm little percent of bit detail additional can XX% one to should expect milestones last the or if we just to year through on Just the you level. cadence of you ramp? getting a kind

Jim Sebra

we occupancy gains guidance then kind Yeah, at kind saw through saw like half kind That's up for the November-December, October-November, the we summer in of is to the in year back assumption ramp of tail norm. months, off the and the the seasonal some in similar pre-COVID the XX.X. back is to last year kind occupancy, that year of average the the but seasonal of midpoint Like average to XX.X%. that of of expected

Austin Wurschmidt

Okay, thanks, everybody.

Operator

Thank you. line The Brad RBC. with Brad. next question of the from comes Heffern

Brad Heffern

Yeah, thank you.

So on from amount gives the talk contributed against declining this of X% number backdrop that think new you what down Can quote, I change? the confidence that's decent the to And in last loss a what about occupancy? new quarter. lease to you

Jim Sebra

Yeah. Great is Jim. question, Brad. This

rents Our quarter early year, fourth occupancy at much try causes began of average There's certainly out comparison that versus to off came same do fourth to basically to our estimates so. the part a loss we quarter at place seasonality the would of Scott in that rent bit this and rates to lease down on asking time, in how slight to little our if we a to of little a the of mentioned, suggesting as asking kind of such try decline. But the communities grow based rents is to rental based were bit our our a by? rents, in release drive

Brad Heffern

that. revenue then just I'm like if loss current I And in market being half guide, on rent lease. blend added of sure to seems an assumption the top underlying it. there's not on growth it's the there that? X% the that's is got Okay, think growth anything of for

Jim Sebra

talked market X% terms kind There market We is about the on little in digits, of assumption low-single bit rent rent of in to X% growth. growth the a that of guide.

But market typically, capture being is ever at growth said there XXXX bit takes conservative So, assumption. rent our kind with least we've last we're of at eye. us again, But XX-XX relatively we're -- a looking months to a to always a little of it.

Brad Heffern

you. thank Okay,

Operator

BMO. with Thank from of you. John Kim line The next question John? the comes

John Kim

I thank follow I wanted up just question, didn't Hey, that. really to get on quite you. that

lease growth year blended for assumption your X%. is So the

is lease last Your X.

market You're stepping top on and this up. expecting rental that growth year, value-add of programs your

get assumption? you lease that So I'm X% rate wondering growth how to

Jim Sebra

Yeah.

comes occupancy. of think to I again, the is drive around what up The picks certainly of growth in is conservatism level to the months uncertainty. add with around just these A expirations the value be the think leasing summer any a respect in conservative estimate kind value kind mid-summer the the macroeconomic a of are highest. But the supporting. I down continue will when X% will cadence just lot stage add lease happen to what to it middle ultimately, that of

John Kim

I'm suggests uplift occupancy and Okay. But The little getting the value-dd bit getting, two just it the you different had you value maybe of the that how company are is the price are Is uplift you're with on rents quarter occupancy we how just this do And interpret loss taking loss demographic a plus we renovations? getting customers these add. your characteristics sensitive. longer in the on complete wondering to I'm you're this it your wondering marry customers? more that on a just this? XX% Or

Jim Sebra

a It's demographic. different

Class A price that's directly construction program that that Class a compete value-add below but A so improves at new our still property with Our we newer rent.

a we're profile, they're it's rent So a be. below resident a even a is our a the the for comparable properties because over because $XXX who's pay that basically premiums the what these higher receiving construction, newer returns choosing rent is community would value-add you our these and know communities, changing value-add $XXX to resident we're product. and with with willing And rent premiums new better to

premium. value-add what's that's So driving that

John Kim

Okay.

you quarter it this it. you're doubling the year, value-add like to last moderate said looks and you that were think going I

understand to wanted Just that.

Jim Sebra

X,XXX X,XXX for we originally No. we're X,XXX. units we're XXXX. had now targeting because And The moderation targeted to is

John Kim

Okay, thank you.

Jim Sebra

you. Thank

Operator

from comes the next question of Nick? The Nick Citi. line Joseph with

Nick Joseph

kind between a I if can is growth. know expected? there And macroeconomic supply you talk, rent that for range that on markets? but how are just the markets touched maybe much you and market of on Understand that of are Thanks, performing top bottom expectations variants uncertainty,

Jim Sebra

mean, growth markets some Yeah, there's a standpoint. think from expected I have good to I rent that market are

I when page think out think bottom mean, have real at you perspective I that others I the in put terms data range X%-X%. is look And and end probably fairly of it's some sources. end the the is top of the X%-ish. tight some of

Nick Joseph

Thanks. And which X and are X. X are versus those

Jim Sebra

So I relatively think growth. suggest, is, But at you a some the to strong so of macroeconomic continue continue if rent of the Tampa, view the markets it general be we'll market see lot sources look to comes like of kind again, conservative I think uncertainties. there's when data to

Nick Joseph

Thanks.

can So about on asset, experienced process? that the you've then it a in with where demand pricing just then start you the market. in sales or from is if side, And anything the talk what

Jim Sebra

close So, contingency, contract in and lined weeks. their up. next the we property have a financing couple will hard under Through of they have deposit

' that close. confident will very So it

volume transaction down overall In considerably. to regards is

significant disconnect think a there's ask. the still between bid I

they still reasons, be know including We where costs, whether of specific are due are. where in seeing people low-X high-Xs, and range, market lot settles treasuries pricing, transactions to some or of occur in. there's this A debt the just but the don't their XXXXs waiting it people, ourselves is cap lot a see to and for maturities, debt

we need transactions. more before in rates some interest it So becomes stability

Nick Joseph

much. Thank very you

Operator

Next question is Powell Barclays. from Anthony with Anthony?

Anthony Powell

Hi, good morning.

move are How's competitive other high due and to landscape where the of are your occupancy moving out When changing you? kind turnover the they going guess, people apartments rent, question to fancy a Class on out. for of A? Just building I

Mike Daley

resident where why going. and this is is leaving this We're us feedback tell the the obviously, Mike. on Well, they're to dependent they're exiting from

to think of they're to because we going the a relative I seeing of So, just are paying. affordability those class what community, of different people currently

some a to is -- some by have situation obviously normal buying of folks moving relocations. level mix roommate large, see But with kind new of looking issue. a total a there's and in moderation moving a our We reflecting with with really, mortgage me, leaving, affordability a younger an and There's, are But house, home. lower that common is is We people excuse it someplace it's demographic rates. affordability some a cost. of back somebody folks and normal theme but people for reasons a live which

We to people options But have a rent income ratio, that which pressure. most do about the have. XX% is see relative of we to so or of kind affordable that

think influences only but the that that probably people definitely is I that are not So, the reason reasons leaving.

Jim Sebra

I would those that have not add from ratio though, or dramatically reasons changed years. however, prior has

a So number And the moving one a move is out buy job the moving two third is still the relocation still towards single-family reason, the rental. is to reason. number reason home to to

always always issue been an be. Class will in B has Pricing apartments to and continue

Anthony Powell

tailwind this times over as of macroenvironment? the something starting a years. more be in Class may not have side, a to a to kind be then kind tougher big the accommodating migration price other tailwind of may those the been that you And Or past? so lot as it kind Okay. start in talked class expect apartment are that Is being year A of guess economic I a on B about that of the A we and Class the

Jim Sebra

It is it going It be be I to No, for think is. a to tailwind. is us. a going benefit

I think you will see that.

If larger see rents. the that assets, you at look a multifamily the A increase Class portfolio of to still continuing with they're peers you'll

I the think are reduction Class mode. don't assets rent that a So in A

getting again, value-add So a Class our they're a believe communities, we into from getting Class do a A down A from demand product because rent. a at moving to A minus I they're specifically further expect people plus see B

Anthony Powell

a quick on Maybe Got it. guidance.

and high upside mild being we for both that the recession and a what's about of talked see? a the case. he have kind think rent to soft you say Is And potential that I guidance? low the let's occupancy landing, base and end

Jim Sebra

it's case scenarios. a say in would base I Yeah, both

think type is effect kind has And landing, that begin market of I will re a unless kind how the too I much to ultimate continue I to soft bit. a some the insurance if I bit. to to little changes that in maybe there think that rents non-macroeconomic type landing think I question mystery drivers that's mean, of of category. accelerate. also But think expenses just the little how the will a occupancy expenses drive the drive like insurance much don't up more soft down be come

Anthony Powell

you. thank Right,

Operator

Thank you.

Next Baird. Mason? with question [Indiscernible] is from

Unidentified Analyst

everyone. taking Hey, for question. Thanks good my morning,

Just million. these for you quarter dispositions million $XXX We dispositions noticed in the $XX that third after came one for expecting the fourth at quarter. mentioned me. But

at or a this the number if wondering net Just the retreated assets. buyer price these if XX was lower for

Jim Sebra

interest price and changed that it up sell reduction. we to came back buyers at We the couple a Yeah, determined they actually with different was still asset. the a iterations went went time and rates good through market a

Jim Sebra

Terre being in since it would we though the like for a growing one even retreated. asset asset us I sycamore was I that did we we had we in I continue Haute. the dispose and will of made But was like retreated. get market tell don't That the you in where asset either. didn't this off a interest terrace no asset And decision

move it it. was just to and a with So forward decision done be

Unidentified Analyst

Thanks me. That's for all for that.

Jim Sebra

you. Thank

Operator

Thank you.

not Linda on Our Linda? please next question is you're Tsai Jefferies. mute. from ensure the line with of Linda,

Linda Tsai

my Sorry about question. for that. Thanks taking

retention What for be ratio me. quick would your year-end? one for Just one by expectation

Jim Sebra

XX mean, ratio targeted in XX% to range. our retention that we've to be I always -- to XX%

based a guidance. year target think of would expectation solely our it XX-ish be kind for the I the So on of call

Linda Tsai

you. Thank it. Got

Operator

Thank you.

[Operator over Seeing to Instructions] like questions We hand none, remarks. I'd any this the for waiting team management have the at closing back to call no time. further

Scott Schaeffer

speaking Thanks again with everyone, and look to you next we forward year.

Operator

your the concludes call. earnings for Trust conference Inc. QX Thank you participation. Independence That Realty all

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Independence Realty Trust (IRT) 16 Feb 232022 Q4 Earnings call transcript