INVH - Earnings call transcript Q4 2020

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Operator

Greetings, and welcome to Invitation Homes Fourth Quarter 2020 Earnings Conference Call. All participants will be in listen-only mode at this time. [Operator Instructions].

As a reminder, this conference is being recorded. At this time I would like to turn the conference over to Greg Van Winkle, Vice President of Corporate Strategy, Capital Markets and Investor Relations. ahead. go Please

Greg Van Winkle

Chief morning I'd the our reference release Investor Good today's on Annual SEC website I'd you XXXX joining XXXX Homes not ended during and quarter Report any disclaims certain September Young, President so. forward-looking information, for update from filings Financial relating Freedman, statements to do XXXX Form supplemental with materially Thank could of future include resources, and Quarterly and describe to Officer; fourth be other business, quarter Report XX-K, non-historical liquidity to and risks point statements. XXXX such results, our for Charles and Tanner, actual our which Invitation on Dallas and cause the some Form XX, in uncertainties indicated performance fourth Homes found section other statements outcomes statements make and expressly we may earnings period from uncertainties our and of time-to-time. can We Operating Relations' and press On Officer; XX-Q on call. of financial earnings differ risks the and these are us at for Ernie today's from also we Invitation results subject those capital statements, in Chief inform on our any that to the Officer. forward-looking This our does like made you. Chief document may you are thank call Executive like which www.invh.com. this to conference call to call. everyone that obligation or to

Chief the We additional comparable Executive are also GAAP to earnings and call to financial non-GAAP regarding non-GAAP now can Officer, I'll measures Relations' and measures the call our turn of over the of we these information, this Tanner. and supplemental certain Investor discuss including on our our reconciliations measures, During President release most available find which these section information may website. measures. Dallas

Dallas Tanner

like grow I'd momentum, well us Greg. staying positive exciting I at XXXX enter joining with fundamentals you, thank the doing we an safe. and to Year well all time year hope the at as It's accelerating to of for Invitation our in for and you Homes best the morning. Thank this you're than We platform. opportunity more ending the years. positioned active New feel we organic in time class strong we're acquisition another been same in have market growth,

further exciting elevate see also We opportunities our front us to resident of experience. in

path reflect and on We validated business people to the these pandemic. durability few and take rent achieved I the to X% rate though, the than residents a same-store We in collections executed of year highlight the moment in value year more was service which our ever. the I'd of which to differentiated ahead want a unique product, in of to was with and tested we our discussing completed. Before communities on resonated just capture the XXXX and We blended ended a the and around at increased to maintained growth, well XX.X%. historical accomplishments. every occupancy high our a month month of XXXX that market the rent accelerated XX% in which year basis throughout of record December. of high like

us. disruption XXXX was in around growing the As guidance, met world mid-point that AFFO despite our a we X.X% initial result, of the the

formed world-class million raised and also nearly external a support equity venture We a growth. of with to $XXX partner joint

EBITDA net almost buying pace fastest XXXX the up since With million these same in homes the tools, our acquisitions full decrease debt time, to XXXX, in $XXX of turn. At by we fourth quarter over a ramped to alone. we

the communities. We We kept solutions associates our to the technology, storm I'm most. impact for we reacting time leveraging genuine we port of delivering self-show experiencing in worked and homes mattered made were residents, accomplishments, resident the and of leasing as proud create Finally, XXXX our most in residents We able scores. comfortable it all and our virtual for in achieve care positive and doing our a and of when advantage safe enhanced residents hardship. all the by of safety quickly protocols this satisfaction to to served high

are I more simply have family we but housing as housing XXXX, take has been excited for coming COVID demand, even already As as we that what generation to Industry proud favor, team believe I have more shift appears I'm its the ahead. next millennial and with for denser our many together more am fundamentals place a poised in of the in accomplished years. was our look of our over been accelerate impact from urban to beneficial single to way. to

will As such believe the quite that to is on hold we possible single that it picked up family in XXXX. gains share

use the other footage and the and to our affordability compared to as rethink play. preferences, and demographics ahead favorably with and changing ways simply, balances we conviction work square alternatives relative greater Our solution people even they space a supply we housing compatibility give residential for which come. to homes to ourselves Put years and for that demand see of when work-from-home world a lifestyle us are the positioned

even and in scale an turning advantage In believe fundamentals favorable and for differentiated our results expertise for addition, into local industry locations, shareholders. our give better we us these our residents

technology to that stress generated portfolio scale of feel time through billion In least our is the path as resident New proprietary fundamentals, be of the homes our We wholly we on to us new rolled-out we to IQ resident with thrilled delivery put actually we're we capability. also see I serve thank helping care through joint portfolio of HVAC additional enhance several XXXX, strong serve efficiently. reach the continuing creating our and and high more our I'll homes acquisition more On momentum track the residents, quarter to to have future. growth we XXXX. which deliver our we interact experience purchased web heights positioned occupancy, makes quarter services to residents we to experience our position. gear experience. is cap the the initiatives this Officer. grow together closing, opportunity a Year. through filter how which to residents fourth you I in are second last widen In to we Technology, in progress we'll services for XXXX that and more record Invitation continues and even record our I'm the us commitment maintaining We're and our the the of of including on to for want Young, growing do that, about a underwriting over associates homes say organic those service. the great that acquisition elevated experience our Chief by approximately want about smart into years. homes X,XXX the a XXXX down portfolio. to home a allow relationships multiple ancillary has to to in entering owned since between residents enhancements, acquisition Operating been residents, turn and better in focus quarter With and this can genuine with with top at Their $X mobile believe ancillary experience, that we’ll continue over ways and confident pandemic our options. enhance our inspiring local our in XXXX convenient discipline. emphasis associates acquire In the I'm working optimistic rate XXXX. a exceptional the the stabilized quarter external fourth One throughout which mid-X for the and expanding have toward Charles the any consistent on carry me growth venture With channels, it in a excited Homes future it year a pace in In and strong high while with acquired across it we estimate We advantages particular acquired

Charles Young

you, Dallas. Thank

in resident into change, than ever. I our to to of our quarter, to XXXX Same-store Before some in care XXXX. be improved versus for them out, at bringing operational our job XX.X% want referenced When three asked remarkable move XX continued results in homes jump year we to year to days year we XX.X% with turnover day way his quarter significantly they thank quickly XX the day fourth the year throughout our we Adapting Dallas in the drove high nimbler days versus elaborate a results, associates and faster. leasing did Fourth days remarks XXXX. I XX XXXX did three resident the year-over-year achievement I’ll our bringing full released elevate full all strong favorable resident beginning its results. on turnover able in line. rate operational residents level of through we’re the finish trend when

XXXX, At rent in continue great or year-over-year. best and accelerate quarter of of fourth a basis occupancy above trends the with same we're our As up our seen points XXXX. approved the points the quarter January a a XXXX our Furthermore, these fourth at result at closed same-store in every turnover time, XXXX. basis XXX XX.X%, growth to month and of with off residents, record sequentially year. we occupancy same-store e quarter day positive to start and occupancy XX.X% year the of marked January three XXX We high same-store

we blended to new the X.X%. XXX New January. and January believe increased fourth the quarter versus points up is X.X% today's in lease of the rents points fourth indicative for quarter, accelerated growth accelerated growth, This fourth X.X% X.X% X.X% points fundamentals X.X% rent respectively quarter basis further in January, the to XXX year-over-year. and growth prior rent basis Renewal year. up in lease which most same-store of XXX brought basis in

quarter full Same-store Same-store X% to Now revenues results the in NOI for in XXXX. same-store year growth quarter XXXX grew full year to X.X% NOI our the our I’ll of brought same-store fourth the X.X%. fourth fourth core year-over-year. growth and turn quarter

strong rate, a result rental gross average revenues increase and rental occupancy a As X.X% in increased increase year-over-year. of X.X% our

expected, COVID-XX. was offset two partially to by this increase As factors related

The point first rental a XXXX, fourth in of XXX quarter in X.X% the quarter. impact core on the of X.X% the from revenue basis was in had gross debt growth to which increase income same-store an in fourth quarter of XXXX bad

a core expenses. related second impact to significant basis the non-enforcement by types for maintain allowing year and income revenue growth property property revenue to fees. for had expenses, brought us other assets attributable This With the our to without core primarily nature continues safely on incurring same-store incremental growth the quarter, late decrease homes same-store The provide to which XXX X.X% point COVID residents our of was and an XXXX. of other to relative and to respect freestanding full serve non-collection advantage

In addition, homes strong reduced our benefiting turnover for with demand resulting from expenses.

quarter result, expenses same-store a growth X%. XXXX in bringing As core store year fourth decreased full year-over-year, to X.X% the only core same expense

remain residents collection rate to to XXXX. payment I’ll which XX% and average revenue the throughout collections quarter wage as for average our pandemic monthly Next strength thus healthy per to fourth of by meet their of far In had earners cash of and across cover we $XXX,XXX revenue in which of testament the of is household, billings, Xx options circumstances. offer of XX%. We similar covering to collections the almost collections flexible compared thousands an our needs sustained resident totaled move-ins rent our two the continue pre-COVID to even individual base, approximately our income quality believe to a

Looking a ahead, our momentum after close XXXX. to on we side strong have

the operational and teams bar field for in resident the continue excellence. service are raising energized Our to

continue As unknowns will was there unfold and a last Ernie factors best our the nimble case number turn to and Freedman, residents external the XXXX, are over shareholders. outcomes in remain but for possible Financial I'll now Officer. to to drive of it Chief respect how to year, will with we our

Ernie Freedman

with to leverage In fourth to sheet profile, composition quarter Today the homes. million, balance we XXXX sheet maturity stock activity, active and discuss debt gross further overall activity, balance used where ATM and following of which capital and through quarter in for issued capital we I'll acquire financial Charles. our proceeds debt an approximately the of the results we start X.X markets. enhanced markets shares guidance. Thank our investment will million topics, $XXX I you,

replaced term facility line $X.X also and with a We new party. than billion and which improvements revolver of component a we loan upsized credit achieve facility $X.X loan measured consisted whereby also closed The if our facility. unsecured previous to over credit pricing pricing facility billion will replaced certain billion proud included have term $X.X and of credit of prepaid our our as $X sustainability that our a favorable improve our secured by We're third debt. to billion more credit time line previous a a previous revolving ESG

As have before maturity a other than no result XXXX. December debt of convertible transactions, reaching we final these notes

In to year Overall from X.Xx to beginning are year-end and X.Xx percentage unsecured percentage XX% increased and as total from of XX we remain from liquidity billion our down unrestricted revolver finished increased unencumbered leverage at our capacity. from year September committed debt at homes at further. XX, was the of XX% XX%. $X.X to and the at addition, of a cash that at December XX% debt reducing the Net-debt-to-EBITDA the

of for using capital. XXXX and were wholly portfolio fourth in purchased JV in activity, homes for our of for for total our XXXX these cash $XXX investment venture were Regarding XXX existing homes balance on a $XX sheet we million, acquired and $XXX million. million joint purchased quarter owned the the

acquired We in the total from two by see were onto rents, transaction activity bulk wholly on owned acquisitions in quarter. the were which that upside In homes a in our place platform. bringing $XX homes million. also and homes to NOI the Included Dallas fourth XXX these we in-place X.X% portfolio Phoenix at this took our for bulk $XX for in million yield sold

AFFO $X.XX There results. we share the are quarter the Excluded favorably year mid-point provided core and Next, from respectively, $X.XX thinking state for I guidance. the at discussed, at will I'll FFO core recorded in and our FFO external and in I’ll unknowns beginning bodies initial at of may the organic but the control is XXXX our gain we came Core thing cover of door the cover remain that point. per in fourth bringing how and and guidance and Last Charles outside and federal increase pandemic year share the AFFO finished related that external play, as into regulatory $X.XX $X.XX and believe unrealized the are of our XXXX XXXX of was financial a were Notably, $XX to this growth. range AFFO full-year per an Dallas year. how million despite we FFO our share. open AFFO result a value factors investment. of the per positioned to we many respond, both about our local, frame we

second half would drag last impact likely higher each have revenue strong into of and with year in as collect the for start bad expect of revenue and and of XXXX, be mid-point Expense than growth debt believe of high full fundamentals for If enforce We the growth. terms to of mid-Xs a factors the in same that in store rental for biggest this then in improved of favorably our on guidance The did to growth in X.X% remains to these our assumes bad low outside Let to positive year. overall year. a XXXX. leases. control percentage me in revenue same-store our half largely remains record trend is we debt the year. first it income X.X% a half ability account, gross play of full rents were our uncertainty, growth of Taking XXXX of us we occupancy The of to the our to source rent out, slight core expect position demand the but XXXX. the XXXX, the to second growth

XXXX benefited from a turnover. As lower reminder,

full by perspective, primarily some higher due of offset rate a demand, expect impacted growth historical strong bad core same-store same reasonable context is X%. pandemic. second year's From by expense. this quarter, expense a same and year. expect XXX higher the for would While X.X% the debt turnover same-store continued we since to this X% in assumes of first store to not some Overall than point turnover be of remain quarter Specific our revenue to turnover revenue fourth growth to quarter timing the X.X% has expect growth were This midpoint first to growth due XXXX to in it an our core to to in guidance for higher year-over-year late NOI results The half negative XXXX in-line XXXX. with low brings on the that store XXXX. expectation to a growth grow NOI expenses be first, in impact basis turnover improvement results the in to core range we more core degree higher we year same-store in to we expect the expect fees,

growth, there our same-store like I'd a Beyond address. results to XXXX are other anticipated drivers of few

in last earnings acquisitions accelerated to in NOI store the expect we our XXXX. First, contribution second drive acquisition in of half pace year and the from non-same increase those

We also to remain net in acquirer XXXX. expect a

least path today, acquiring year homes. million the and stand $XXX JV approximately $X of billion selling we the home between fundamentals see a and at of As to this REIT

expect capital. to from acquisition current opportunity proceeds fund cash level JV with the operations, cash-on-hand, have We that to activity disposition and of

than that Schedule Second, could share result in be funded equity, our higher I quarter in XXXX XXXX weighted which found fourth XXXX. Year-end a like portion our of we should count acquisitions to everyone of with a count X(a) would on share remind this average information year supplemental.

related another for XXXX additional fee our for formed our we in share income will and to item venture joint revenue recently quick of income from in report item Beginning unconsolidated a joint line an note venture. Finally, JVs. line investments

of XXXX contribution during Rockpoint our ramp FFO do to we up at in all for share $X.XXX share AFFO $X.XX flow and the per FFO our in our of $X.XX the cash year-over-year we AFFO, growth midpoints we AFFO. portfolio. In representing $X.XX, approximately phase of we core of wholly this recurring the FFO and core joint range together, than share full year share the of X% the venture, each. of per core range manner owned JV less expect Putting to XXXX and in purposes expect $X.XX per for For the same capture will to

thrilled is locations, best-in-class of that, by have As family Homes those step market Invitation of positioned believe by AFFO about to share, growth the With the advantages, favorably our our $X.XX further view, and the a single the Taking runway our in differentiated coupled future rental is sector to resident we dividend up with XX% the result grow a share. for a We a recipe Q&A. open opportunity per In of scale we and quarterly are line within per experience will anticipated increased Invitation and Homes. be scale expertise. back, years growth come. transform for for to local long housing let's

Operator

Instructions]. [Operator

Our America, first question Bank of go from is from ahead. Alua Askarbek

Alua Askarbek

and guess and guys this. already end impact morning, a not plumbers about But we're higher thinking pipes this initial on. this you year. I I a this little like CapEx was everyone guidance, a lot taking the cold seems delays Good wanted but Thank that's bit note, how I Hope or of you expecting everyone. talk for safe. part this past start could the lot now, just the I will the just is are to front expenses assume right going on it bring on mean that bursting call are off holding despite to questions all and about that hearing

Ernie Freedman

a deductible have amount. insurance. that that up been by year we'll a event, our news certain beyond of for multiple able first good wishes. and This the for to because take of coverage insurance one any we’ll We Alua, lot parts a in The on it, in insurance appreciate states expires do will damages very country Ernie, to have the has so good of is of $XXX,XXX I We’ve it be across XXXX. losses but in and February Yeah, cover to had the this it’s challenging portion due this is a well sure. insurance

in so good But budget now. happen specifically out said, So insurance. has be should spot events call I certainly considered of risk that's flow of that. of the saying, that we on from overall through, our expense what guidance. year, Those some this be some don't but things in taken things a minor this pretty at that There right was to not throughout do think puts may in be our long range base kind a type any acceleration happening, pop-up of going the and were point. But that our outside will we way did not guidance

Alua Askarbek

ticking-up great, in this seen know you far Okay, thank turnover year And about Have your and you you. so for low, but then maybe expectations talked guys I January remaining XXXX. any guys from pick-up February.

to a a want of that normalcy? of is reversal a we're if demand of kind bit in little now see there bit see starting little Just to

Charles Young

Yeah, no this is Charles.

in just We really some haven't to which grow really see Work-from-home kind of place. healthy reversal still still is allowed trend of get there as to a continue the QX that XX%. our the assertive can I in January little of mentioned dynamics for good and so given seen to We on well that a revenue lease and as our demand you our is we're our stay lower at as there are in have the to-date. higher and on us trying in whole going. to number number that year, We pandemic ended renewals that side, We February see of residents do which growing. has far kind any but want homes and new stay sign,

Alua Askarbek

at point how year? it stay Got follow is last medium did compare length it. this and to then just And sorry, quick up. What the one of

Dallas Tanner

year. trend we the it's With XX to over as us, portfolio continues last our the is, as months. now by to as XX continues month continue toward turnover In this months to the upward end to for of grow it that Yeah, season. expect would XX, low it

a we not third staying a yeah, if people are see lease, as renewal. continue per to So second that

XX So months. about to term XX is our average lease

Alua Askarbek

you Got it! Thank much. so

Dallas Tanner

You're welcome.

Operator

ahead. next is Sam Our Credit Go from question Suisse. from Choe

Sam Choe

we great Hi, well acquisition you guess, guys guys. I X have guys Congrats quarter. mentioned, ramp-up the to home kind fact of I on part that But yield. aware as builders of bidding hear built mind, housing see I awaiting are discipline stories maintaining mean, over – and it's you a mean Dallas you the a of where competitive in for it’s that homes, contingency. market, good over

I'm guys you about wondering, at you you So more to how I but your at. buy-box. peripheries of you, Are to, for the are I mean thinking look starting are are starting know that to matters location guys markets the you looking

Dallas Tanner

Good question. Dallas, This is Sam.

in First have even a phrase ability is we to quarter, our mentioned. a buy-box this environment. and between environment million wouldn’t say in use as $XXX foremost, in feel of confident you to sort million But $XXX change buy it any pretty existing way. still and to tight We our your

in, both parts and that themselves that of that and disciplined sure pretty lend our markets of making in we're we are some new see We outperformance, around rates. renewal

In seeing portfolios. the opportunities an smaller terms doing know and our focus. you to We're we're to Historically of buying of aggregate we’ve also about with and builders. you builders, roll-up work homes that's through area mentioned XX% partners of XX% been

losses to our to least and on bit into on The those one, those us day those, opportunities do in in continue some fourth imbedded saw radar. You be good quarter. the flow stabilized as of cash walk news will a and you we typically little so that see

making and should the to at of run we’ll this the but beginning are confident expand in pretty with that to of and country that on channels, avenues that really continue feel pretty in, we we many consistent stay ways are necessarily aligned we possible. not but find active So as work to opportunities just focusing keep as the the rate year that box, maybe parts sure

Sam Choe

Got it.

a to as that that of that kind one-off mean nature mean see Was XXXX did I I quarter. or we in makes more playing well? that the opportunities bulk mean this in sense. I Okay, With could factor you said,

Dallas Tanner

record. We have good a track

of and people You more times are a the see to I five XXX looking the expect know for at capital. other of maybe have least we’ll harvest those; gains last some eight a of you you know portfolios deploy know just to for kind of that rolling-up year XXX, would wanted to couple home opportunities years that aggregating

do you is grow mentioned, As you've unless to the scale hard it. to it infrastructure got kind of

ground, are know these lot that on get the fortunate to we're with we opportunities so of working access local We you in direct a partners.

two the we quarter, those. the example So that of fourth perfect in did

One long period of in them able a a was one known Dallas, Phoenix operator just done. we've the one the at a for and to we're the competitive is process, get transaction time;

So those for a focus our matter big and market. relationships are they and meaningful in it's teams

Sam Choe

Got much guys. it, alright, thank you so

Dallas Tanner

Thanks

Operator

from Berenberg. Our question from ahead. Carl next Keegan Go is

Carl Keegan

of forward? pandemic of guess question. Hey for for guys, demand kind seasonality thanks the see Is the longer the I high persists, year’s less briefly, but taking touched going my and it fair move trending the to I will seasonality expectations Meaning know turnover outs what aspect? that in you are lower. on path some a little you assume bit diminish

Charles Young

Yes, this is Charles.

the business. is of part a know You natural seasonality

pandemic somewhat to were uncertainty we so of summer by home, from high comes. disrupted last We've see how it would a those returned that working trends people school. the with year be demand the However, environment, interesting saw to with

year of vaccine with it we the that that. seeing think are numbers based herd typical I this is time are QX and some summer we of season. know you happens like immunity on to our What is, what in going rollout, be all of

demand side is in, higher with turnover our which up and for to people would are turnover circumstance on is they're given and similar in renewal with expect for Hard but we position more in know QX, high we that and still in for the really product improving we lease So said, now the of and will the the continue. expect rate you right moving are kind natural where maybe that a the a getting market, growth would That we demand of being predict, that new a our we may that little both kind better. end looking is come that it we QX. watching like that side, states summer the to are bit seasonality we're

New is the been this the lease in I've side, best business a seen we've QX, in frankly. since

it to be if demand be summer, and high out, fall. thinking will still for about the interesting but repositioning are people plays it'll about schools we especially think thinking So how in the finally see

Carl Keegan

sustainable think And the you guys Obviously we as on pivoting growth. is that in a it. it this Got mind question particularly next if little Western lease bit, new do up. continued trend How don't U.S.? my to

Dallas Tanner

part a have, occupancy. us and Yeah, spoke back thank They’ve What all step know high wanting shout-out. move low I can't of then homes so homes. markets, around space, and changing occupancy of supply and them just look phenomenal our to landscape; you across those people give urban almost job we get XX% and or dynamics has wanting out about – cores position a at a to teams I'll our a market’s I our that And to does get just push can moving is the markets, you the every a XX% enough. when a our done big give of been just it in you to

of So west near new is in continuing high, your to lease Phoenix I real new lease same, in California QX. the XX%. January growth is is drive think the growth continues XX% Vegas

year. up, re-resident think I keep push keep we we'll high have rest be into continue days to and going expectations able way we to occupancy are, the of the down, if we executing So the of

Carl Keegan

thank me. it that’s Alright, you, from

Operator

Citi, Our is Joseph next from question ahead. go Nick from

Nick Joseph

Thank you. safe. everyone Hope is staying

dispositions any dispositions? that is sales one off of any million or year. exits, more expected Does $XXX contemplate market it the On portfolio this

Dallas Tanner

Nick! at market it's anticipating normal Dallas. discussions exit Hey calling. ordinary not all. you No, We're just know

Nick Joseph

has are Thanks, the Is down moved leverage and going? as conversations timing? rating any then the just with on how Ernie, agencies the update there

Ernie Freedman

Yeah Nick, business feeling we're as how we're opportunistic and as well the XXXX. seeing done it know and in seeing had has where more more at you

half have year so some or a ago. would over bit years little if we I to us be It a will that been to because going right in to two the and improve. like few the a engage, more to it be a a and quarter well the formally I we're do doing a would the metros time the where really to said figure timing business than think can we feels there, I quarters engage maybe So to have out, two know agencies you know get what’s you out position, think to XXXX time if and is better maybe need see Nick, next continue for with

many quarters on that have we're right that you the optimistic know about and better we're So here. next the path news in hopefully

Nick Joseph

some need the of improvement today? on still metrics or what's Which focus level

Ernie Freedman

which credit Yeah, were larger, us facilities I able mainly borrower. that pool financing; secured agencies we were more a our get us think really unsecured to recast like you would to know the rating the December gets with we to importantly able unencumbered in and we've we Nick, where to close been pivoted

sixes the them get soon to show don't kiss by we the expect, guys that see agencies think rating for think show next and area where is, a that you it’s the you number able if lot would one I debt of bit – sixes your EBITDA like the clear believe so with be enough by as have and will I to the them sixes model, is then, I we'll our question year, this in we’ll in to be the not be there I net maybe still little year path. the certainly we and end the would off of into know we're a

we've You our the sixties good and track have know a have our we've target. low in net think a done very to I how talking debt-to-EBITDA number we've to got certainly been we record about that; as wanting demonstrate path fortunately clear

us So all step one bears each and just well I for it’s that think day we’re getting to that number. closer

Nick Joseph

Thanks.

Dallas Tanner

Thanks Nick.

Operator

Our next Associates, Zelman from Kalmus go from Alex question is ahead. &

Alex Kalmus

Alright, guys. thanks

wholly the acquisitions. quarter later revert strategy you Looking rock this value, price seems JV Is per this point emblematic higher front, average acquisition over to mean were expect into for a the owned do the or like the this it JV to on like the XX% point the home the on. of homes

Dallas Tanner

with The though front that us see. have me, Alex, JV and actually consistent don't it what we probably versus if transactions. mean, I you doing the we doing take quarter market it’s the in in were buying point you’d what brought I What see with Phoenix of revert anyway we absolutely you because portfolio, transactions know those we're bought that is for to we’d would down. the with bought a Dallas you the math balance going to show did you each the is on with regards to type because a in bought well the the of the the be there, other as we're sheet bulk to bulk good of question. Dallas, in sheet. top what what homes out as bought average fourth price the lower regards two JV what is our price that of balance right but think It’s

Alex Kalmus

it, where have makes extraordinarily do move apartments for are the or on moving other sense track keep but And to of a data? you is for rentals? outs, high, or the are going? – got moving it single Yeah, homes they they're I obviously you that out, requiring Do out Are sense. family occupancy they that few

Charles Young

reason. have We a have track them this going. don't are We where we is Well, they Charles. specifically – without

in the of the You start kind know addresses. we're going to forwarding the future to addresses, track

as for in would not material purchase the the know up been reasons You mid-XX’s, with have you move QX, rates. homes, our interest in expect but the slightly

been from just seeing historically. turnover overall know lot I of drastic a outs so low, being not what number it's the there's overall You think move real change no we're and

we're it, turn we've able to the to what proud overall with So been we'll continue monitor of numbers. do but

Alex Kalmus

not that through living really that so of it. home the single Got I a once seeing of move family you’re of overall. sort a style staying that lot rental, outs that guess apartments, And they within are

Dallas Tanner

and correct. – or move you what from our people coming we're and of residence or out not our we're tracking reason. homes, of are single locations, into consistent you that family homes know know people know out to so move most core our you come urban Yeah, seeing who the locations a that into know homes from are lot for who we it's pretty our moving Correct, people people seeing field out our a of in you suburban are seeing of now,

up that we’re single today's safe In family trying a people family, bedroom, to because single world. fact in extra the things the come get kind you to are work-from-home, home of backyard, all from

Alex Kalmus

Great! very much. Thank you

Operator

Stanley, from from Morgan question Richard next Our ahead. is go Hill

Ron Kamdem

Richard Kamdem for Hey, on Hill. Ron you got

bulk know can with the we’ve more little bit on the still user it institutional in, more fair without from two or the it $X billion to players end maybe you of ones a Thank. coming Just quick for talk of you your that Sticking XXXX, for acquisitions, that sort me. Is bulk competition? sort about in sort see or acquisitions to of sort it's the guidance done is number? say and of acquisitions embedded starting

Dallas Tanner

as pretty I Hey, be you it's more wanting single think of quite or that frankly three we think $X and last one that positive. say keep I acquisitions similar it about landscape in to include a capital it's years. is which hearing how really you four doesn't yeah that you know rental safe exception It to exposure, view billion a lot been. number bulk family The might know just

there’s million percentage the we remember, a in around expect still and footprint small is X transactions family a those that so vast it so wouldn’t or housing the minus end majority of SFR happen really buying users much. transactions, to plus of change selling that in all know It's year and U.S. those. single You homes every very

these think other will lend some themselves opportunities us I a more for down of if anything, road. few aggregators and the

Ron Kamdem

I’m guidance. XQ gross sort If think of roll to of get X. Is to opening the sort year. the grown baked late especially in of of debt coming Thanks. mentioned has in X.X My just is it guide a say about and half a how back back the sort Great! sort much that as easier into second the conservatism the headwinds into you on comments? to that, the bad your fair second for to portfolio going fees XXXX sense trying delta of we I of the basis, really was versus of the question same just that comp store revenue is

Dallas Tanner

Yeah, throughout lease on you're Charles like able up the question high well the the We last fives. at the basis a XXXX points in being what on couple income the no to debt and XXX were into year was gains tailed the just prior unfortunate we look When that rent you XXX pandemic and of to and bad as side we've as of the a said as Ron, have Offsetting you occupancy you points team know you kept drag about and up and exactly as was right. down the didn’t part as growth know year. new rental know comparisons numbers which our a it’s you know been you well. other stronger the do, putting stronger renewal side, good achievement basis

at X% up ended growth. we how that's So revenue

the just a You know being right the think know the have continue down out; from number little debt but you that regulatory uncertain does each we quarter, know as we you herd prior bad you just don't will in do the go out vaccine have we're our bit throughout environment still come to we’re yet XXXX, that do quarter and environment sequentially expect immunity and us. we now, you move rolled on in

in numbers make debt guidance in started bad fourth in so half bad basis back think provide but that the probably see in more supposed in the better, is debt from understood you and be thing year. quarter, the Pre-pandemic we hopefully later pre-pandemic. appropriately know whether conservative mid-twos. first third not second the getting coming and to typically has and You prepared the to to the you in do the we that's know because remarks our saw we half like year number pushed want that of that understandably got were in was sure which the what the think low points. we in clear, but our we appropriate perspective and saw and we is things January to just return people the the deadlines to know expire to then to from mid-point on detail environment and that's that we December of out what you We the to we’re guidance better think, XX saw year, Hopefully a

to in here Ron, We’re it's think Then improve. you're in second not better that at here year pandemic. but bips to We forget our was don't high-XX’s the XXXX the expecting XXXX. and number in in bad based you get back debt to a those anticipating a again, going just certainly full levels. had first of I numbers year, said know quarter. not the We continue the on we’re what importantly higher of the the quarter earlier, not much number when by terms of in impacted It’ll looking half first

any and income on then high we like know have and bad revenue hopefully strong if for easier year growth earn-in mean, So had rental out eventually a per happening our quarter, have then occupancy because of see most from the in better you is an the a range what's number, see we'll hopefully level XXXX, each carrying as for the then guidance through month, you'll at have debt, what we’ll plays which easier other for we’ll I achievement each comp comp in the have continue to XXXX. really side part you’ll we’ll

Ron Kamdem

so Thank much. helping you for clear. Thanks

Dallas Tanner

Got it, yeah.

Operator

is Pawlowski from Green ahead. Our John go next Street, from question

John Pawlowski

collection debt, thanks. regulate just maybe this bad on very driven with more kind some non-California Ernie, uptick front? that or erode markets Great, California a sticking of Was regulatory the sequential modest in other quarter. did

Ernie Freedman

question it’s a No, John.

did board. average We a it’s for little overall been it’s across like the just California; We in Californian of the across Northern some degradation has and it’s earning Southern only a Southern the That's California the challenge portfolio. whole are then behaving in deterioration not us. see like seeing been California. bit

you less slightly things, the and we're saw quarter. numbers should gap It's what we of XXX in the know which different talking start a narrow terms things, round we’re off. in When third In points about than we than roundings just you basis there.

XX% in we of point where just that kind where month the to we've collect we're XX%. environment think I somewhere hit to seem an So between every about kind of

You pretty got been under us just know little a in plays of steady it cases both you that's and XX%, bit it's out just really We’ve but months for around since of some over kind know couple it's and been a It how XX%. July. XX% months XX% month-by-month.

them from don’t seeing see spots, residents, from and the we're and working wonderful Charles material we're that's just the anything really we with and any not trouble seeing variation are concerning job only with So doing a contact having mean, place team average is a the California. where Southern

John Pawlowski

then lease are fantastic. Okay, Ernie, new Charles spreads understood. obviously or And

Just revenue curious, a years, much enhancing from sense figures acceleration me CapEx the for lease CapEx? new can the in and recent enhancing is through you revenue give how benefit flowing

Ernie Freedman

when you base are. Yeah lot of we it big whole We're give with not the John, a how let specific a and look touch doing you at scheme number. of to the more size you offline grand me

So in lease point a probably the two-tenths a to it's helping a side. my tenth in new point maybe of terms guess, of of

to you and offline with of make them. notes can and me Let back speaking – go check I'm not Greg with and we sure can turn I touch base my out

John Pawlowski

Okay, thank you.

Dallas Tanner

John. Yes

Operator

next question Our is from St. Haendel

go Juste Mizuho, from ahead.

Haendel St. Juste

Hey, good there. everyone's Hope okay. morning out

Dallas Tanner

Thanks Haendel.

Haendel St. Juste

days XX quarter to been the that, can for the get Thanks. and you're a here then perhaps lower and bit that, much on for I question in So, I and XXXX maybe guess fourth days versus talk re-resident. I in Charles you think XXXX. fourth number, you've in about here drivers do XX first can there, how to days overall of said quarter you better that improvement or some I thinking mid-thirties, guess know help the perhaps ‘XX do to sitting of XXXX? versus you able the think that of what

Charles Young

Haendel, its for Hey Charles the question. here, thanks

so ended to and was QX down all versus in we just XX, of year-to-date First XX up XXXX. reduction said probably XX significant days at as days in XXXX you we're down clarify, XX. A not XX,

the is, some XX significantly in our high markets. the markets, come the we from of the brought reducing to XXXX know teens a from of some digit One teens. has down items. down real You combination days low at which start impact in turn single times,

but we day looking that and been look at lower to as going at going So go. able two can there, that as we piece. get keep we be a can key have we to or We're not much a

The going focusing that sure piece aging, get us if or the asset, advantage piece other check focusing big going opportunity let's make pre-leasing, is inventory the that right. aged on really something price is that's on also it's a big of that eyes that's we I moved big that think right and is year sure the found this been on The making forward. assets, in

level, the think in XXXX, we're market its it and other to can the have using occupancy virtual least home still in being So on pieces properties demand what while do healthy as continues website to be our around we up tours keep seeing residence. you can at or way really through the that our thoughtful how either and it's strong do all at and that the we being try we you show worked know we a while effectively information

some moves those can of days. teens it us and on out the that'll turn it into when get we quickly, So

can is while see going and will we see to get in stay there so better out to or down continue but we though, and move, two got low did. down those go. to looking we have but can see thirties, year what The hanging So stay it even bring get then to the making it low-thirties to you're see an if as move sure try not back opportunity and you day average we out we to do We’ll the we gone another go we'll go. we where than XX but day for happens, we age a continue inventory. fruit We're – to this a we'll to of

Haendel St. Juste

consider concept certainly overall family strong maybe just that’s of That's sheet sheet you; it want thank you change growth, increased rental development where there’s your obviously development fundamentals, Maybe got quite color, that is good on here. yet, the guess you. about has your evolving, is Thank could color, good we’ve I’m you've curious are you in to for not, what good balance and and view NOI How if improved to for one you. noted the get any you there here. very stepping an inclined back today – here single revenue proof thinking Dallas And acquisitions, not the competition on-balance industry I change, but and more on-balance-sheet mind.

Dallas Tanner

hi Hey, Haendel.

You in know and our right philosophy same, stayed just the being focused so being the locations.

is think really starting and know I and to some with continue ways the and expect focus good development in you partners into put of nice a out of product I and on portfolio. the channels to in couple new would we've to deliver done working will finding quarters that develop builders market last job resources

the are for as to can, that there In threat partner quite terms pursuing. also that and hasn't might of a changed we competing as out in of against we to be risk, good builders our really position neighborhoods taking on and balance a sheet there going and out want they less be flexible be frankly of terms

and really, partners, being with good rightfully a and we our approach terms balance levels; to is access know that or at of equity issue into call to building; own where is price our and product and think in use up getting when know discretionary tool it of so, our I out to you a appropriate in you at national pipelines local raise good a of sheet know they're good of having direct So and want use really a really our because that it's either you it ability communities position terms couple we you think building pointed kind an capital, the boutique makes sense. both of strong to

feels to continue continue on like a in I on runway we about We’ll at to really for opportunity. necessarily continually so that finding that, now out but we’re few minded partnering right stay but and/or there's it risk in the you those having focus perhaps some opportunities, us, builders with channels be we think building know open all sheets. making of right front sure when we'll And balance good as not look to deliberate do take opportunities,

Haendel St. Juste

a a right no, but so not not exactly certainly it’s Yes, now. that's not –

Dallas Tanner

company do; the of least so to possible, can on I projects, Yeah, that focused we're it’s access making over if and And we know to we to are at provide really some but what definitely good distance, going somehow position right and not now time in yes. a those do, together they that I be working. you can really mean we're risk taking a think seems great of amount at good we're really and builders what the we sure two match be going good these forward.

Haendel St. Juste

Got it, thank it, got you.

Dallas Tanner

Haendel. Thanks

Operator

Our next question is ahead. from go from Rich Evercore, Hightower

Rich Hightower

Hey, good here. question for taking morning thanks everybody, the

know wondering investment investment. lock in entirely. you up mean you're and gain, one prevent a you the you but restricted quick sheet sitting it time me that for or just balance for from the on Obviously you nice that a on the plans time are anything know for Just the Opendoor a liquidating being, what keeping are on with future would

thanks. Just a color little that, more on

Ernie Freedman

on it's Ernie. it so perspective December at XX, was mark even partnership been from for real a up been where course a the from outcome at and absolutely great This Yeah, us business XX. was the the with Yeah, investment pleased is investments December that Rich. we've of further and

Rich, a actually see to be specific under the Opendoor currently you documents we're able lock anything up can so works. and that arrangement do how are not We about very lock-up public to

the second level to have second above at while, opportunity a entire shares for the been stays of the later certain the flexibility We quarter sell a in level end that if have price and of sell some position and it's before the to the stock well the we’d quarter. the

quarter in so our do do of made we'll to organization investment to different with committee as a of are determinations want we’ll to the our and great continue conclusion we to may work to what haven't maybe We a term that decide on later come hold lot probably there. They things. what any Board Opendoor – just We position. with longer for our a

Rich Hightower

Great, the color Ernie. thanks for

Ernie Freedman

You got it.

Operator

Tony yeah.

question ahead. is Rahmani Jade next from Our KBW, go from

Jade Rahmani

Thank you much. very

increasing questions and to the number the gotten new this space. in entrants from relate the Some I’ve – landscape concerned investors competitive of

yard a I ARE. with think recent established that takeout example partnership the front the with residential is [inaudible]

think you've learned technology just the established you've such for Rent like Homes Homes Invitation will have provide think get competitive and a over lessons the So want advantage the and or I always over these others that as through in to made having players reverse is whether case, yourselves with the entrants you that the you about hand investments thoughts your to upper operationally or newer scale gone edge built you that as the and newer whether American believe entrants.

Dallas Tanner

like service business, Jade, mean there quite and the as so get we're much your difficult I not all Yeah a quite it’s model efficiencies. only connect. and those do you taken frankly, are out, but and coming you to the companies latter. ours it’s It’s and at got this how to more finding new how years better inner assets, into figure run the create workings team, build continually just the

that the a for and side experience this Jade company structured the the digest to density are our is have flip have, know in and it's new resources you easy of like all trying pretty quarter fourth onboard would too kinds quarter to sounds just challenges know of make that, and mean we customer know side get communications company and don't a the in you but easy, we I that. can did our run tools scale you when You and of the X,XXX and homes we in to

in be it's better is, answer short space now. into to this than much right position the So our coming

Jade Rahmani

a cost lower any of these points company would have have year the were to meet capital to where itself, as rent a a private of be respect drag, follow-up view where basis mentioned bids entities a absorb XXX to to able purchased med-X% XXX five a that, stabilized come the cap longer you You with time to as or homes cap these of any underwriting And seen horizon you company private either they respect rates Are rate. earnings that that below to as sustains perhaps if are below on materially seven seeing outlook. growth in expectations so with the public that with

Dallas Tanner

think definitely a knows, within niches focus everybody there's It’s the little different to trying buy space bit different asset, rent. to I And economic tend price good operators I that we a as in question. higher mean gross on. I point higher little are the in and would call say,

leverage, one longer over term that two. maybe into where they because the profound long those You using your committees of themselves maybe typically in do I will are in to approach, it probably in know much this, on a don't advantages certainly absorb we having we're you of that over do varies. there I point and how family se, single market per is, impact term or can on thinking not kind what it’s think really that term. are through operators we're so you we cost at and they think I yields do operate CapEx, see lag and place have better competing differentiator, about some but a with some about the properties with lower think, all the thinking of that lends can't know, capital argued don't people debt, their price time especially how drag. points, what say your properties investment I can a near because want to that their around

so a and can life team know of costs And figured new to putting finish rates; returns doing and the may as distance; you be things in the seeing like you're what and time you've we've luxury it over be that asset. around you conviction able to our kind that you our you it entrant I the job money because over costs it really not good the like are plank vinyl best a manufacture of flooring, which are into out know home, Charles have return in keen internally a as got of kind seeing are; renewal feel standards

things of figured properties managed of time that the a Homes I year business having as experience, thousands kind into as and that we head Invitation come with at right we’ve Jade So nine like out think seat today. balance

Jade Rahmani

you very much. Thank

Dallas Tanner

Jade. Thanks

Operator

is ahead. question Goldman from next Our Go from Sachs. Rick Skidmore

Rick Skidmore

Hey morning. Dallas, good

Thanks. being Just should some West, you your acquisitions how $X it that can Is XXXX a mix how be deployed think focused about in distributed, the billion geographic the just foot think going we reasonably be us color mix, you going as and across print? give maybe evenly in thinking to forward? question, about in more geographic on Texas, about you

Dallas Tanner

if would a active in at focus kind the to us The much. markets are expect look over able eight are Florida very been four to expect We and more think seeing of return the a at us markets I us good next all could lot fourth importantly buy rate our look us Yeah know years. several just markets it good that much give South and too change. love like pretty end They perspective that I the the very would for that be markets you and The a things out theme works to pick competitive Dallas, JV the also we the of the really get and I pricing in what hard Sun expect seen Belt Florida actually consistent think to of active quarter, change of remained don't good I for of in and we good fourth markets. moment. we're Atlanta whack But out terms chase California quarters. quarter user typical what wouldn't in from where has in I just for Atlanta. Washington. more look We an profile a just we certainly question. a growth to in that tool even I couple is mix when mean, for you Charlotte, activity exposure obviously did the kind perspective around in gives if more of of from adjusted you too They' Florida, us. would risk We've the focus same. that our in are conviction homes

fundamentals the the them we’ve on So talked as markets right around have about all call. these

Rick Skidmore

opportunities one in you're you Thanks. ’XX? elaborate Thanks of roll the Right. talked prepared and revenue some your out then in contribute XXXX. just to ancillary about how revenue comments on growth what might Can that XXXX and to you in follow-up, planning in

Dallas Tanner

new of this brought then filter that couple new in was out a updated that of forward. with We on year. there’s opportunities structures some ’XX will smart all upgraded HVAC leases created profitable customers that new program more start actually bit that our be us going to going on our a We’ve home hardware; our things. in for Yeah, we’ve a of some little make

that to that We've are mitigate also us of some other things only focus that in compliance of We that and that the focused more expenses. this And Florida be going something controls of on of seasons a a will control, we kind delivering pet for roll that around have generators, of pilots service way but state figure got there couple out think the going merely going we as that help across we year. then markets. pest and are that around revenue not will big adoption are has could are us right those out pilot

in and about ready got not test So optionality finding things is that a really a things deliver of things foremost few know We've yet, you focus. our focused keeping to some there's ways a exciting we're to resident also in but kitchen couple kind were on. the of talk that to

We figured that a into it, lot they out They the of like are services. our adopting the in going of residents and like have flexibility out.

them obviously will included the optional, these of lease. of some So with will be be then some

Rick Skidmore

Dallas. Thanks Great!

Dallas Tanner

Thanks.

Operator

from is go next Wells Todd Our from ahead. question Fargo, Stender

Todd Stender

Hi, thanks.

remarks a occupancy little Just you this might high, better on Is you you that got one turnover pushing a footing. more see also guys got you me. but year. more? little rate prepared potentially your In residents you that from financial indicated You've so

they naturally options? Maybe that housing just maybe more have So color there? some Thanks.

Ernie Freedman

naturalist mid-point the as between the somewhere XX% had we up place. evolution. we down It see And of it’s Yeah this happening two great kind we of with landscape XXXX pick know turn our just numbers, possible that up think you of see pandemic’s had some terms from in relative in at are just, and residents impacts a who the those basically outcome know year, turnover Todd, with what's guidance in a went it's, XX% and to it’s to we because we currently XXXX. you

we hunker to to going eight a down XXXX. the little bit to or likely we longer, think be the and that all accelerated see the Some of seven in chose had because we're trend the over It in downward bit uncertainty last spring age. for leasing seemed continued a so little in years yeah, turn

that want where purposes, to trend take what little mid-point are bit certainly And of we we so from North we get assume in a going prudence our of we of for in XXXX, somewhere were XXXX. the guidance, kind a to we that's where but downward just saw

Todd Stender

Understood. you. Thank

Operator

Tyler next Janney, from is from question The go ahead. Batory

Tyler Batory

Hey, my good taking for question. morning, thanks

higher to rent prices relationship for in wanted go me. growth. on rent the and I bring discussion and growth back one the between to Just home

interest talk the home how to want talk dynamics. there potential sales a side different affordability lower affordability is on about so imagine more much at push on with the demand your and thinking the can the know terms want you about time, calculus to about you but the well, and you thoughts rates. new price how Just just so there renewal price. I has in be side obviously strong, both of on you're might as And out to you But more understand able same been I renters of curious updated

Dallas Tanner

we might think our as of what and terms the months. we this certainly go management thanks it we're darlings behaves. Tyler, of revenue know business. Because around system summer really of one bit Every year little our expectations how earlier as about and smarter through question the portfolio our Charles you be learning data lease about the homes. XX,XXX year the about portfolio gets a every things the good really a in better It’s talked and our optimization curve some in gets

a housing. bit to that constant little been we they in put nothing portfolio. a I would call outside different are do the in a bit being of to residence it longer. expect little normal things certain dynamics wanting from have stay bring all would does given of with nature It a out year, It's the Now, that things the decision – making

So and of obviously this stay some afro added demand we’ve year. to place in increased some that's expect that

lease is to market. friendly the that home some portfolio Interest back. alternative it than when our payment to risk lease you cycle. Now in can that more to pretty home. look cheaper as home volatility offer we to to own around or a you that’s folks around most CapEx at affordable down you maintain whether the look associated potential own all as affordability, to the step and manage speaking, create maintenance that its at cost a is to particular over Generally balance expense striking life We with much point most got rate nuance your to take of a a is and

taking are of of a markets it's an affordable provide whack. that right and still much you around a those opportunity So out back; on rate to basis. see affordable a our you're in leasing throwing maybe pretty volatility interest relative to more product We generally numbers most step

a more rental times all-in-all got on themselves product that that based affordability, with take corridors than great price $X,XXX be different heavy you market not, than vary submarkets, expense. Now but of to will affordable adjust, know cases schools, maintenance that’s day product close lend and proximity the you to in on a good of in to and with a end maintenance and and the down more points much seasons, when transportation the burden to at payment

on working to find So especially at ways, make on market that lease fundamentals being the right it’s goes then we're lastly, look the renewals of a also been sure capturing to always balance, finding normal and trying the and is going on and in home there out and side when markets. the that new portfolio with vacant, smart, to rate your see, that available we are those considerate that demand supply what's

So the now. been really and we anything sensitive of for example we’re rank do to cash that put frankly that year a rates California to renewal around haven’t and place quite everything have in been a almost where able Seattle good where in

the today. and in having that that navigate of portfolio we're So the nuance mostly healthy with we’re dynamic I it's with through to some would say that's living

Tyler Batory

detail. I that very all Okay, much. Thanks appreciate

Dallas Tanner

Thanks.

Operator

over question-and-answer would I Tanner closing the like now turn This to back for any our conference Dallas concludes session. remarks. to

Dallas Tanner

there, all us joining this everyone appreciate We all this during our We Thanks. together. sympathy Huston you. those our Hang with we’re today. and our there, weather. for the Thank in associates joining us everybody in residents Dallas, call appreciate our and thoughts in and and

Operator

now has conference you for The Thank attending presentation. concluded. today's

now You may disconnect.

Invitation Homes (INVH) 17 Feb 212020 Q4 Earnings call transcript