Invitation Homes (INVH) 26 Oct 232023 Q3 Earnings call transcript

Company Profile

Participants

Scott McLaughlin	executive
Dallas Tanner	executive
Charles Young	executive
Jonathan Olsen	executive
Michael Goldsmith	analyst
Eric Wolfe	analyst
Jeffrey Spector	analyst
James Feldman	analyst
Austin Wurschmidt	analyst
Steve Sakwa	analyst
Juan Sanabria	analyst
Adam Kramer	analyst
Keegan Carl	analyst
Buck Horne	analyst
Daniel Tricarico	analyst
Alan Peterson	analyst
Tyler Batory	analyst
Jesse Lederman	analyst
Brad Heffern	analyst
Anthony Paolone	analyst
Jason Sabshon	analyst
Haendel St. Juste	analyst
Anthony Powell	analyst

Call transcript

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Operator

Greetings, and welcome to the Invitation Homes Third Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

At this time, I would like to turn the conference over to Scott McLaughlin, Senior Vice President of Investor Relations. Please go ahead.

Scott McLaughlin

Good morning, and welcome. Eisen, Invitation President Dallas Jon and Financial and from Officer; Chief Olsen, today Officer; Young, Officer. Charles Chief Scott here Homes Tanner, with Executive Chief I'm Investment Chief Operating Officer;

the after our is supplemental sell-side [Operator Relations reference information. www.invh.com. was covering Investor our This remarks, with we XXXX available quarter yesterday today's analysts. conduct question-and-answer document Instructions] a Following our session the prepared of earnings and our website third call, on During market closed may we'll section release issued and at

Invitation those we that Certain statements, make from and nonhistorical XXXX forward-looking of our other cause results report or could materially these of capital the We during our statements the disclaims relating forward-looking performance uncertainties other some and any with uncertainties to which SEC does make filings actual identified. risks include outcomes do XX-K obligation are in this and call future time-to-time. so. statements and differ on Homes liquidity and we not resources to statements subject expressly may business, to Form results, update financial and annual describe to risks from

this certain call. may measures We also non-GAAP financial discuss during

You to earnings GAAP measures, measures additional release. regarding in including could find the these non-GAAP yesterday's information reconciliations most comparable

now I'll our Tanner, turn the call Dallas Executive Officer. over Chief to

Dallas Tanner

us. Homes, our over worked and we've is joining Invitation unmatched systems hard and At of for dozen last the platform our thanks years, enhance our build and our morning, the Good people, scale. which to foundation

professional and while and returns. in diverse, have proud value strong their the as live this and for replicate geographically to school us to flexibility our across significant drive a We've offers platform to dispersed highest what partners. neighborhood helping our residents, we to achieved home, of the We allows is of and, choice. service, convenience industry-leading We're to heavily in our them meaningful assets It level of believe and our in invested platform delivering stakeholders, provide residents system performance result, regard. difficult

addition to imbalance for attractive continues continues particular, most our favorable our frequently shortage platform, continuing At units. owning robust and United estimates, our of demand have mention. million lease housing drive due the a in In And of make the of these time, By growing single-family to than face favorable continued the similar soaring include strong that supply to rates more one for we power for to and the demographics, to tailwinds business. fundamentals a the several affordable for flexibility and homes leasing same and demand home. desire convenience a mortgage much homes remain States

cheaper over Burns, residents year According their for this to families our we of and single-family $X,XXX lease a the for in than leasing use thrive homes while meet can our to demand average a believe $XX,XXX growing a to flexibility to on it's that at the choice own We well positioned lease. same time remain benefiting home. from markets. now over That's help savings in to John month

homebuilding addition, committed remain our we through marketplace new the bringing extensive relationships. In to to supply

most Our to on multichannel of variety the attractive to us be across the us growth channels, which real acquisition opportunistic, strategy nimbly various deploy channel allows capital cycles. estate allows a depending that's in

growth contract external July. of a for we wholly owned portfolio previously of XXXX, third X,XXX the took of of $XXX announced opportunities. our This quarter acquisition included advantage million During several unique price in homes

portfolio's year. market, with homes selling on portfolio right X the at a rents the the been non-core marking and date Progress within increasing And anticipate line to we year we yield disclosed, we the in in Xs mid-Xs. into this next has to acquired As grow our the occupancy expectations. to

we funded transaction, an acquired acquisitions We of portfolio third effectively to owned also average cap disposition X%. through owned channels quarter average various XXX addition at of during the X%. wholly rate these XXX approximately cap through rate another at an large the the those homes In of homes wholly sale

our acquisitions this The out between value XXX way recycle and higher-dollar for basis dispositions to homes into in spread accretively portfolio once point to time again to recycle our makeup ability unique some We this product. higher-quality and affords newer, illustrates older, come. of capital accretively capital us believe opportunity

associates. my their to performance. thanks continued work, express hard closing, Homes significant strong I'd In to achieve milestones dedicated has financial Invitation Through like deliver to our and

to to our your drive stockholders. for opportunities continued capitalize forward, platform support. we growth sustainable leverage ability and navigate challenges, these remain on and our move Thank you and trust confident we value our As order in in for

I'll to President call pass our Chief Officer. and on Operating that, Charles With the Young,

Charles Young

the delivering nearly July. in To Thanks, I'd like X,XXX acquired comments your and for we great another hard Dallas. onboard This smoothly work homes our to start, to quarter. echo by thank our teams the associates includes

scale this make and large portfolios one size premier resident is and ensure associates relatively help seamless ongoing our the is the experience like is it while transition Our programmatic who acquiring amazing worry-free.

basis XXXX, you X.X% X% by I'll growth strong third fundamentals a line of quarter our results. quarter operating in execution Favorable average grew led This X% increase in as improvement revenues with growth driven the well in to core expectations. monthly was third bad quarter as rental NOI and the point XX Same-store debt. rate through year-over-year. now third year-over-year in of of same-store walk

year. meantime, second with of to attract great high-quality service. Southern the and homes to In pleased residents first consecutive progress improved times continue within for where We're our quarter, including California, professional court here we part meaningfully have the the see the since

$XXX,XXX new earned of year, household ratio residents a combined income of the For a months, an XX income-to-rent over representing average trailing our X.Xx.

industry-leading is reporting over their our an an half program. over short that of we've partnership strength residents time, evidenced score our XX credit of improvement our increase announced onto with these free already in credit Esusu's with of just XXX,XXX have financial The average points. In July. About helped seen Esusu we by customer in also a enroll of residents

us. to indicator attracting service, to believe of addition average to see residents, premier contribute our increased quarter is an We with of to services to ProCare value-add the convenient of this In we're Length stay offer, with past which overall high-quality they months. an XX satisfaction, longer we this along pleased and has again resident stay many continue longevity. help

discount bundled out one residents offer on might The at digital to have the high-speed with newest is the scale their our started partner country. over to offering and otherwise what that to again, We're X/X us this excited just largest we of a providers nation's to Internet roll to own. to across media our pay substantial our allows provide Once of essential residents service Internet.

Turning back our to same-store results.

This by year-over-year in the increases compared year-over-year. X% expenses in making primarily to an of XX.X% in our with increased backlog. progress compliance turnover expenses core XXXX was related and on of controllable to expenses, the historic the increase lease fixed along which quarter driven included XX.X% year, cost last latter Third we're lows of the

remained same-store Demand of in season. cover leasing I'll Next, through markets leasing quarter. peak trends strong the in end the third our

saw footing the we believe to following represents As are we we in years. noted more sustainable much past rent which seasonality, growth previously, and healthier the a return X normal extraordinary market a seeing we've

includes XXXX or XXXX higher quarter in XXX quarter of quarter results third average our the occupancy leasing and than XX.X%, well norms. third are our Nevertheless, points basis This same-store third pre-pandemic averages. still XXXX above

addition, blended XXXX basis X.X%, XXX higher rent XXXX/XXXX in third was third averages. growth of than In the or quarter our points quarter

third seen of acceleration X.X% an third rent represents strong renewal attributable growth quarter month blended in of rent was comprised X.X% XXXX and October's to that quarter for We're rent growth the outstanding rent Renewal renewal of further lease of quarter growth rent with Third growth is to the once X.X%. accelerating growth have results. each preliminary our performance of pleased new associates. XXXX. This in a is again

of we tremendous remainder As they the proud remain focused I the this for quarter and finish past will contributions their effort the the we deliver of on year, this momentum strong. I'm know the continuing the great during our teams end year. year and of approach

I'll the Olsen, Chief over Officer. our to now call turn Jon Financial

Jonathan Olsen

update third results second, Today, Charles. year topics: updated XXXX full on cover investment-grade following balance Thanks, the finally, first, financial an and sheet; our I'll quarter; for guidance. the rated

our cash and unrestricted the had end we At billion quarter, the combination credit I'll our capacity a sheet. $X.X begin third on of of through undrawn revolving balance in with available liquidity facility.

Our end to end the net debt-to-EBITDA the of Xx targeted as X.Xx of the ratio X.Xx at was range. of quarter, third our low

to And average of of over XX% Over rate is or weighted final a our of debt carried fixed total until maturity borrowings interest rate we XX% have fixed and swapped unsecured reaching debt X.X%. outstanding rate. no is our debt XXXX. Our

to $XXX additional we an of a earning the comprised of repay we closed remaining X.XX% a July XX-year public deposit growth $XXX serving million coupon notes X-year an $XXX at from revolver powder of of million $XXX portion net on our offering on drew banks in a as repayment notes and coupon. with X.X% In dry million while our proceeds future net in attractive bond or the debt the We used proceeds million for yield dual-tranche at meantime. the August,

result the our Fitch rating. to we capital, and a pleased affirm continued company of its for were stable our sheet as ratings from August, flat see balance to outlook access strong In to upgrade positive and BBB

our on Next, I'll financial touch briefly results.

$X.XX, to due FFO per an primarily NOI. increase core X.X% to year-over-year increased quarter in Third share

per quarter share AFFO increased X.X% to $X.XX. Third year-over-year

our thing guidance. full year updated cover last The I'll XXXX is

line a included X our have release Our in year-to-date third generally results expectations. quarter remaining With tightening of our months little last expectations. been most over of the night's year, guidance a with in

expense same-store to on revenue for higher a growth X.XX% in primarily growth same-store includes expected based of X.XX% narrowed expectations NOI which growth for to X.X% Florida Georgia. XX.XX% tax and a same-store XXXX increase core is range year same-store same-store a of range and based X%, guidance to core This in XX.XX%. on core expense full narrowed The growth is property revised expense of

to are to the offset been favored least us, Based XX.X%. home and tax to receive approximately While expense us quarter, that's known of to rates originally expect the occurred XX% price appreciation property property that's some in bills Georgia year unprecedented received tax tax that housing same-store to we've partially millage on causes we both of would and the decline there. the anticipated growth fundamentals or have the at well during not case expect full property now fourth Florida

also AFFO of to of FFO per $X.XX expect share. at now FFO and core to Our $X.XX per midpoint, a expected tightens core share year AFFO of year-over-year per or XXXX share $X.XX, We in $X.XX. X% growth range full year updated a and full the range XXXX share ranges guidance the in per

have open With the now that, for we remarks. prepared please Operator, concluded line questions. our

Operator

Goldsmith with Michael from Instructions] [Operator comes UBS. The question first

Michael Goldsmith

that slowdown seeks factors question in in occupancy rent. lease to My and frame the the the caused deceleration

attributable how moderating So return back better compliance structurally much a more underlying averages, to the it is I is to where to demand? and long-term business normal reverting averages? And guess, is where pre-COVID now? lease pre-COVID seasonality,

Charles Young

Charles for the here. thanks question. Yes, This is

Now seasonality seeing expected. think you that we're look, out, laid we I as

I the end we'd of are think times, all year. growth what a of pandemic on typical level let's of terms of we more bit in rent that the the we've kind little year, means. off this signaled that and Coming occupancy, see heady seasonality. which And set this expected

lease year being or throughout kind curve the June new a of is means that around bell goes peak July. with What

move-in growth. as in kind summer we've the and And bell are September And when pop seen turnover getting happens. of that get Because that's season down so the going typically, the your you're is and why the new people you the always rent in. real in moving curve end lease of historically, August

at peak if day, end But may bell August downturn, curve on September. the will, of the you And is vary. that and the the

pandemic you I right X% lease around just COVID, And went new to X.X% around the to X.X%. back back if prior for look our range below. pre was or So that to we're and September, times,

So this stayed is normal. the throughout What's not steady historically the on year. other hand, normal is renewals,

been running a little but historically. there, than we've seen so And warmer we're we've

X% around back look you renewal pre was COVID, X%. to rate If

rate in really fundamentals this X.X%. demand, high we tells an is the leasing are of of well. our is there's undersupply still September What homes, Now renewal you that business, strong we're where

work. add we have, would expected, we little it that I our compliance as a turnover given higher backlog year, And this lease to

I put we're You And we at in normal about, occupancy, those we that expect. would that years back high. this being you XX.X% QX really seasonality if together, go talking all to was weren't

the with business. the return strong we're overall kind driving high fundamentals and time for seasonality really So nice combining of rent blended growth this kind year, of normal really to of occupancy a

So the good we we more just were going of understand the seem feel that at had X and season. abnormal, I we're like where different. end are. it how years day, may it's to I And typical back But

Operator

from with Eric next comes Citi. The Wolfe question

Eric Wolfe

this taxes sort what in And just of similar increases? next look very appreciate of in just moderation taxes. a aggressive historically, point. terms trying in like So given prices, low home is of that change this the to year But you or it's think I that visibility whether will result good to on year, a prices the at be in is look of degree understand really you predictor should in year of XXXX another seen increases probably if tax tax a going you've home of if year at that moderation

Jonathan Olsen

It's Jon. question. the Thanks for

think hit on with asset what's happening growth and the been about the with expense prepared to appreciation, been outsized values last home I you you what's While year-over-year head happening we're the XXXX tied when really X time, together at nail has this tax years. the property been not what talk for

I sort of you averaged growth tax around over a X.X%. outlier period, to side. if same-store was period, our think that annual within an interesting, trailing time the property XXXX look X-year But low it's

seen we've think catch-up of I So a a bit factor.

look always in. values predicting were at us. we've problem think we been good and property pretty where going tax, come Values the to been haven't for As about

on some expect year. rates. for That That The same have didn't of is have that of that relief as our that values to did to see history. we would that pattern not and substantial, we us increase, last it those much what experience millage degree was This over increases challenge we is year, expected unfold. we our been come assumed Obviously, pass.

the no greater anticipated, need So than to I in relief And as municipal on we Florida. millage we little revenue out, based budgets in it on inflation. turned think Georgia saw probably rates was and

XXXX, how about to look we going we're property reassessing to be as So tax. we think

think what at to in for our February. a be But intervening less reliant XXXX. prepared about We'll been, least period. not talk I we'll experience as give on said, I has the historical for sense 'XX we're

Operator

America. with of comes next Jeff The from Spector question Bank

Jeffrey Spector

want maybe you what seasonality now expecting? lease about to quarter, just guess, we the clarify I on say, could to, into that October, into for from talk XQ. should think new I let's rate how comments XQ growth. September fourth mean and heading that what the see, And you about Like normally should from historically what may be would we

Charles Young

Yes.

up we're the of on. As goes to year I But new low good the and kind through be, and then QX described, QX bell will lease will and and into kind up bottom hard Where into out down go demand. predict. of goes build later of will still it's kind seeing curve point and we

We have high occupancy.

at our drive at trying what look that, low healthy to of given you the turnover occupancy, towards are is know As some point. this we we are kind that of

kind lower will we And there. right I now. see than balance much But it it where so And go the goes. that of don't will we'll expect are be

strength renewals, as leasing seeing acceleration the -- of we're on is as from mentioned. October, in September And renewals. about. talked think mind that our keep I into newly our is of given I our low turnover, our business XX% I Again,

our And overall drive so does that results. really

is the side on seasonality the business. -- lease a new So is part of

COVID well. at it than you it normal And as been -- actually blend we're it throughout really we much And year, how understand works. It strong. the blend is that welcome look to historically higher to. a at because the when pre look that and And our used we've period more we us we're brings

turnover. So -- we kind go low given business feeling bounce good expect stead. and leases QX new out I to in is loss into start we'll of to bottom. where our And renewals, overall around And and lease good we'll then while our is go there I'm QX, of

Operator

Feldman with James question Fargo. comes next The from Wells

James Feldman

at sales got had it sustainable treasury just So question I your new even Jeff's X% looks keep X% rates the on We've which about mortgage XX-year rate it? XXX yields cap is of how is to or can rates spread, I is talked is mean, yield cap where X%, X% versus and question, acquisitions. you rate basis point sustainable in mean, could about I actually, rebound much that my quick October? high. rates how you your on grab or off asset if today? sales market have moved given the on how is just talk But a your lease

Dallas Tanner

the doubt And as rate behaviors and of the no Yes. is the there's certainly landscape and This shifting look, in mortgage arena. we environment that elevated look marketplace, mortgage buying selling Dallas. at overall is the rate home

our is to positive probably going that business in Now view our of Charles less is, as the out, availability it's impact pointed to currently renewals the overall. marketplace landscape there because transaction

evidenced predicting things lock-in resale you great and of we terms we is I annualized a NAR's of that The somewhere And X we're effect around I talk the there, like normal is sales with is number out on economists lot think are transaction of environment in million, and volumes. have off how relationships by, hearing homebuilders, by and XX% obviously which think, think very real. as there

as price large, given that market or of today think a experienced, assets And does market not we rent are what it's X on the sold business? the at look for is active if Many at clearing any all get point. sides We mean single-family you buy right? capital of X I we rental What to And buyer what ago. in homes are see less years And data, transaction, inventory. there back on think it the as for the MLS we've homes both think, than enough. and at I by in were candidly, MLS are trying there

a are of we We finding outbid. transactions because not that environment get lot in

homes the in is for have as marketplace the around there selling. demand basis on so in And ample really And evidenced been consistent. that's data that a resale we

we So comfortable. feel really

our up As dramatically years. are last values Jon about talked before, over the several

the As we reason any an we're problem marks. great having management selling no selling that And market, as allocation those cap in we to at perspective. able forward. a being then going for go deem back we we're very a much capital little particular And as invest capital to asset good sell homes homes that business about we strategy really from the for our into rates, talked view in at accretively home higher to release,

older long-term maybe they of have selling We're homes those little recycling form CapEx CapEx risk better newer yields with some homes, into at much and cost. risk on generally very

muted. I as is like can that homebuyer there. feels So -- mortgage out market But a answer it at long can albeit much rates, how to more don't be know it's there the that market even today's

lack the see the However, don't in is we anytime soon. real of that absolute a And supply marketplace changing factor. very

Operator

Austin The Capital with next question comes from Markets. Wurschmidt KeyBanc

Austin Wurschmidt

unique of kind in And you've lease You guys this from year-over-year growth. tough year the comps had rate have normalizing some challenges highlighted of conditions.

compliance growth of expect XXXX lease the you us? business? tailwinds XXXX to referenced backlog the those above through growth, when as the occupancy are and period, work above do to sustain rate had can You've some well the you I those higher And and lease periods given rate as behind and just you lease challenges occupancy guess, turnover.

Jonathan Olsen

XX your speak have if the his question, transitional heard Yes, I'll are I not answer progress with backlog. XX%. to doing team the made we basis rental far delinquency as down think yet. XX year-over-year, was basis I down been piece. was occupancy short you is think through But our really bad debt ground. was working Charles yeoman's this Quarter-over-quarter, right, We're debt bad as -- points, and period? Charles sorry, let pleased the through I work on but the down assistance we've

we So income-to-rent you released customer ratio. our is the quite get at strong health as homes of look our if those

the a wood a systems able particular, that fact to we're of heartened been easier markets So little it quickly as others. by quickly. now are bit in of we've bit move California, Certain have a still becoming certainly than got navigate. little more moving I court to seems think is though to our little chop. more But bit

through But little that in going seeing transitional our to going time business of we've light say yet been and year, a underscores we've strong think, take a I in normal. to But we what that us bit posted we great how are. of can underlying it's results the think we've we're experience I really portfolio have all returned fundamentals truly and the before what

Charles Young

just a of Yes, thoughts. this couple add Charles. is I'll

around knew to through We tailwinds. more there's compliance positive had was backlog that least this asking You're Look, we're turnover for go it temporarily. going the to of year, some and we seeing. the elevate

all discussed. tremendous just year Given that had rent I We're long. as normal backdrop though, we've lease new returning seasonality, growth to

We've seasonality, been XX% long. occupied QX, year north all XX.X%. in normal of

higher forward, we I this -- at As see and where will as in look And rise to a go transitory as normalize had what typically next to ultimately happens, is to the on occupancy back start we've going up. it portfolio we we start into out bottom that start are year. and doing QX will turnover backdrop this

lot of it's -- seeing November new to around renewal lease demand went the for November, of And the Again, really over for December and highlight X% lease on out way. good And the we a renewals, seeing -- just there's still across at balance and really things going asks. we're good good new on. renewals. So

the that business, to that leads of think steadiness I ultimately, we demand the the have. So

back in and better tailwinds comps this of in that working puts kind ultimately, Atlanta our through think especially work And we still footing next compliance said, and once others. backlog. I markets to even few like a normal. get that, then as will as year. we markets easier California And And expect, us Jon of many as couple to are do what know for those stable lease through it of a We're it we a more

Operator

comes Evercore. question next Sakwa with from The Steve

Steve Sakwa

getting few a just I'm a down. this to by just nail and a this -- on follow-up number got people I've because trying hit guess, I

where very more coming it out. You've been But guess, a bit seems on leasing. going I there's the and about renewals clear where, in opaqueness little are they're new like

Charles, So to of year, maybe range. that the think this you kind X% normally be historically of the range said in would I X.X% time

So towards higher in the leasing you of end folks the new range Because are kind around And the is are to you of or their lower say, October? that get think for, end today. the just of I are trying arms where range range?

Charles Young

Look, All for right. are is good. Very October. This we Charles. -- the month over is not

preliminary this is So all on both numbers.

are also what that where will and normal be of And see what the compliance it We X%, above out. for seasonality turnover, of a we We'll again But we're be, seasonality in settles backlog. doing expect on the bit given elevated in range. comfortably and lease October. little to terms given the that it is

I it's we And that optimism. should if think I like So where a are. more lot the you're give looking ahead, renewals

drive blend XX% only of leases, we do the we renewals is steady going our and go the is keep our on occupancy and to high. the lease that as what what's new Given forward

Operator

Sanabria BMO Markets. The next from Juan Capital comes question with

Juan Sanabria

normalize when that is to if compliance on be those -- you that about think to those or cleared of growth you have is expense stripped work profile lease a over the Just churn sense through debt what era think do homes once that? we'll just the COVID would out, kind And of issues, do out? the if cost what items would

Jonathan Olsen

good Jon. it's question. a That's Juan,

pre-COVID in or Historically, to bad XX run, basis couple debt for take, of bear the you mind. things a us if period. to give points go back think I has

For been the down has what from experience quarter, the at basis several in was last quarters. which materially third came over we our points, XXX

heartened by absolutely we're So that.

than distance, take work in time are get of into terms do of backlogs. said, can are play. can Certain delinquency hard We in to of return timing. of longer that to The That hope. it's courts That think we process their out the our those back to issues of we I come resolving do those over control levels. those a how various that see sometimes the believe a lot we pre-pandemic quickly factors factors said, would can and path through predict normalcy. steps to There a

I Charles I has think the is would for talked other about. elevated turnover the reasons note all been thing

XX% of to in those our cost regular up, I related way XXX turn. turns I think can move-outs. and roughly a move-outs And year-over-year. XX% or evict skips more third skip think, basis were the eviction than That's quarter points

back that to in So portfolio few before experienced we of if to you to for and higher take of very -- a really COVID. the march it a to of good I sort the of we going the on elevated you put a turnover, path skip as continue occupancy longer, will, few has fact when we adjust subset of similar last feel of the evict that the average operates return we what are larger anomalous on getting together, those that all cost you this a towards a to manner already, sort years see turns, if normal, turns which think beyond impact impact both days those an that the a additional turnover

Operator

The Stanley. next with Kramer Morgan question from Adam comes

Adam Kramer

to I -- sheet. know about wanted on did of you the offering of kind kind Just talk the the in balance the cash the debt quarter.

I it result. is of think than cash kind a as has historically higher sitting

You the little of acquisition bit. guidance by took up the a kind

of implies $XXX only I here acquisitions million on it so from kind maybe, I of think, owned the wholly side. think or

cash just now. of of for? terms in is deployment, kind maybe of walk used through capital that that acquisitions maybe that So be what like can the just else And anything set some the opportunity of not terms in we're us thinking about

Dallas Tanner

is environment. question Dallas. This Great on the

a little I'll thinking about I -- finish. Jon speak cash let I we're and think as we're around bit how

portfolios our much cash, to want we in make evaluate new have sure interesting as between smaller be a next the flexibility we would some us being of continues think also there. and based better our a the for ultimately pipeline I position then position on they to with of opportunities markets, businesses, over as availability where stay the for to which continue moment in M&A years And maybe sort additional tree decision and decision hopeful we out that as have to JV couple make that's an a strength. have goal construction, ready to get a in of be area capital

while and anything we last front opportunities digested to when pressing we the or quarter, did And if so want X,XXX look, or that don't we of ready have current us. certainly homes come be we in just

having the from of some significant of see We continue with to And are out about of type what-if of still there June. inbounds embedded in to lease loss the still that we Nareit sort I've portfolios. sort at seeing moments. smaller We're talked opportunities other

I get those trying their where people around seller. if still you're are think heads to a are opportunities

meaningful discounts older speak, newer and of call, to earlier I newer this sell less bunch not they're source insulate we to on big to really assets opportunistic product, product our growth of we being As with so the business. as risk of external a We for to sheet, neighborhoods at while selling able in at where continue stack CapEx do updated prefer kind pretty of see sort mentioned balance MLS the to a our marks.

sheet out just doing making of that all sure keeping we're plenty talk cash could also have and from we're cash, then of our Jon more making think eyes available, can be activity external I options an growth that on that what balance any keeping sure us. available to kind perspective, that open, So about our we just with and just

Jonathan Olsen

put of is respect Yes, the that the So capital we With redeployment at is such X.XX%, good an immediate in bank sell at the acquisition accretive, cash, earn basically opportunity. the cash, X% up that until thing really right? fact to a to go we feels I point a to We mean, park something the can don't have sort assets that and we still the the and moment can cash cap, it is Adam. need after that interesting side. on find

care sheet circled think flexibility. to which And a right? sort our that of we liquid, of But makes of to just if So of dry if securitization. moment cash much in one powder million optionality. It the us, earmarked, capital So balance take in hand, having minds, to in maximize that things considered, lot this sense XXXX being cash it's certainly, time, is our having on portion XXXX not directly now, is, is to a maturities, means on just the right holding as want all want I sense. accretive. $XXX of We that particularly maximize makes for

Operator

Keegan next with Research. Wolfe Carl question from comes The

Keegan Carl

came you're Just any wondering recent given articles management, if on you could color news entering the that that provide out. property

Dallas Tanner

We appreciate the question.

have that nothing of strength with opportunities, By speculation. said for comment to to don't nature, past ways We have leverage report. can our of we're platform we the that find capital-light we today, as look be continue grow enhance both to where the We've But in our accretive to also and actually platform, for can going on the to nothing report. operating we to areas and own look margins.

Operator

from Horne comes Raymond with question next James. The Buck

Buck Horne

relationships thoughts more or you're expanding on on that, just your up with joint do Following builders homebuilders, on there. with venture to also, could And if availability build-for-rent your on comment interest maybe thoughts partnerships communities. working any there's any finding I any or was you if wondering

Dallas Tanner

thanks Buck, for question. the

On have some us. mean, for I excellent this the the relationships builders, I of relationships already one existing been have equally we excellent bigger is on I around for Those second aware the everybody in country think been them. that they've hope call with -- as are builders definitely yes, we of.

We is and sort the our or C put expand of we partnering that discounts. of we it the manage out deposits one kind are by and those sort through reminding homebuilder things of way create more, We C is just a meaningful of very we get $X would that, for us. limited just channel everyone, that of call there. additional, And flow with all business relationship O-plus-type today to can O, pipeline, efficient roughly way looking love of about sits we a what deal pipelines of at billion that call, in of in effective which partners. And

space especially As sort for with for have markets in one been we think vocal and that is the the single-family sophisticated more we the around on, in and same look areas the also pretty capital treating where opportunities, partners light that ambition are equity of that are of other doing REITs, of I around we've ventures prices do.

-- that new front, we so dialogues announce And are don't to we active having have while partners. we potential sort on and of always anything with inbounds don't

be areas the around of is One seems business. construction most of to appealing that the which our new

everybody a And on and about meaningful develop continue our business with me, point, capital over still we when bring talk keep JV strategic and us. opportunities like I we'll time with will to them put be over And work could think feels out if well. as that, to our capital, there for sheet Jon's we to balance continue businesses time. to a there's obviously for to evolve natural fit partner as And that and us to that or anything build posted

Operator

from next Daniel question Tricarico The comes with Scotiabank.

Daniel Tricarico

changed guidance last talk from outlooks and you your the what coming on down, expectations hearing JV Dallas, partners XX their the Question over acquisition to how have can you're or days?

Dallas Tanner

are. terms price I where clearing I days is. where XX a markets conversations in aren't they've with where debt or of it's think capital been do every are And as in the around think capital we more look new did I And the $XXX that today, at shifted. deal that bond the around X.X%. days just being had feels or that XX you cost there's of around to of and XX team honest if sort blended debt think has like conversation It the August later. the different facilities on mean, is far market, Jon a in I million market basically

we talked about on-balance if the of is us partnership a be world of willing a to the Xs. earnings outside like looking things price? do And And where our able. calls. today. were with with on for that of accretive think being that, like sort today's cost feels sheet, last our being would as capital opportunities so sort either in We're as need that about theirs where in on Xs we we strike it's yield in in for to capital is or own and just partnered the definitely are And We've I think it

is so right now. through times. of sort at less what we're willing And to capital navigate I that's market trying think

Operator

The Street. comes question from next Peterson Green Alan with

Alan Peterson

most concession what usage just As the occupancy end across of I what's wondering, to offered? to you anticipating average being into concessions year-end? Charles, was And today? you are concession year, the markets needing portfolio kind up seeing build the dial you the to the back of out are stare

Charles Young

Yes.

through things market and the to ran we're the kind is XXXX on typically solid trying concessions as to demand We holidays. the down But at we're occupancy pumping. here. to no your QX. now, about So footing, still But point, the is thinking landscape looking go slow selectively on into looking we feel while and of go a

would And I that some a that concessions run markets little have been expect so we'll softer. select in

As that on this thinking talked homes be I longer. bit. around look it Phoenix bit in But the a around two it softened We're may I've little a seeing a about about of a Vegas, similarly. Those run little sometimes before, lot softness of be little market lately. will markets

we'll that so And to try product. move

balance. So it's a

start are year. in into level, kind of XX.X% your expect to to back can. over we here. really, just fast be it's in we'll plus/minus, going XX% we as And at October typically I from of need to seasonality. make around point, then footing the we good want the use occupancy, the And what concessions that as that rise And sure will same and how that happens At That's trying be. that's get to push to as

Operator

The question comes from Oppenheimer. Batory next Tyler with

Tyler Batory

especially for a that Pulte, A And in builder bit talk then assets that when that remind with taken lease-up trends, look those relationships. you follow-up from you rates unit about some you've maybe what can little economics relationship, on better homes the your comparable getting you question channel? your Can underwriting on cap us and at homes? you're of already, down

Dallas Tanner

outperformed and latter generally we've on have you -- releasing, any specifics tell taken them On while Yes. as we're the your I'd are point, really that communities don't we in. rents we've we just underwritten

before, Scott held the really it it like. I that market like just mentioned to I feels want Xs on to of of the construction you and be pricing communities risk to sort somewhere at some to as as out and needs our things of And he's that they've onboarded. absorption and today new Days start have measure think shared sense the Investor different some make the in

end return of shift that can And fair, be we're to the mix by day. vary But market-to-market. total at the investors

convictions risk. need we part, how believe because that's proxy in see replacement demographic we And way looking have cost about we going-in that like or a a where rents for, asset around So we're appreciation think on measured then one going where feels for go. to we basis trends ultimately costs

that I it months, me. years. months we years? is think staying today as -- have thing look customer And and business, conviction you at almost quarter average I more more across around, one XX was years stronger fundamentally is is you portfolio. say this I XX as did our meaningful. excuse a XX the wish with that But us much XX the That XX the

associated business. years a in have And turnover XX customer we window, value a many in between our and about pipeline our And coming to at you it. with massive XX brand-new the a proposition potentially our talked business into and old, costs them schools. that demographic live community winning for as that are of Jon that new As with want the look business. to is customers And of average us

Operator

Jesse next comes & with The from question Associates. Zelman Lederman

Jesse Lederman

might hearing offered for and toward they your than concessions would any longer class in apartment might for asset be luxury otherwise you apartments more any impacts seeing rising Are the is attractive? from recognizing apartment make of that markets value multifamily or availability single-family proposition by that the be, rentals versus keeping multifamily renters products operators the new any across catered supply largely

Charles Young

Yes, it's good a question.

majority our the come I renters from start of single think with family. I'd

that not have a that from It's XX% the multifamily -- there's from So are lot around number been or historically somewhere of is coming less. coming overlap.

on -- market-by-market vary will it. to But of the generally, have in it attention a terms so the not and that we'll size us but And pay we'll market. direct see of impact

a bit South when was product it we condo ago, felt of in a a of years Florida, there. there bunch out I think couple

extra But given a families, a are so for Dallas for looking looking their again, its each all folks kids pets, things market will that schools. these moving and space as single-family And having call, are have most nuances. that school people for driver. the of good districts, I our That's backyard Zoom homes, said, for having drive think own of the

been And the homes. multifamily a And not we're the so the kind generally, that looking that competitor mom-and-pops of all provide. that's do at kind and universe, our time. given our know we ProCare marketing most and platform there against that, service competitor given are of cases. that's the what well offering isn't in But professional that our we throughout. all of we And direct main And are out is,

Operator

Heffern Markets. with comes The next RBC from Capital question Brad

Brad Heffern

Jon, I the true-up you fourth if taxes was the for of the wondering the fell that quarter. under-accrued size give into could property

I roughly think is X.X% quarter the implied growth the guidance fourth for OpEx. for

without been taxes. out-of-period wondering that would Just the have what figure

Jonathan Olsen

think expectation and I that property I Well, the taxes will QX think year-over-year is quarter, for up -- fourth reasonable X.X% maybe X.XX%. between be the

I right think it. way the about to think that's

Operator

Anthony Paolone comes The with from JPMorgan. next question

Anthony Paolone

with brackets? tax does even that -- happened us you this next the full range keep property and if high really impact we're any such bring about expenses these if growth another and is starting what's just the insurance the on given just year? a year to again help year, normalized 'XX, to your run thinking Like going year there are into more side about maybe along the guess, think impact I same full for just enough year? lines, down levers up Or OpEx to can

Jonathan Olsen

Thanks for Tony. the question,

we're we're said, 'XX where position about yet. to talking a going I not in start As

everything totality. going evaluate to think are I we in

that for over outsized growth look, we in sense February, prepared will to are of what talk seen we XXXX those understand those around we both in both years. items. you a expectations when about think our line have are last of we give few certainly the I Because

think a be think, be other had where the when little remains I release we And going to to there our our time business some lot bit guidance. factors and more resolve. take about is, we long some take to "normalcy." I are we that about that And a that happy we of a to a How been businesses have in as to midst are seen. of temporary back structural that impacts and are, we'll return think chat think step in have I 'XX

Operator

question The from KBW. Rahmani comes with next Jade

Jason Sabshon

This is actually Jason Sabshon on Jade. for

separately, think cap the do that over So rental you And acquisitions next prices is to IRR on you view what's rates, at what over year? X- single-family do outlook And current X-year hold? attractive? as for a the your home

Dallas Tanner

unlevered rates, there. seeing that digits, you low around markets, the out in look an reasonable as assumptions cap the returns going-in at double of it be home basis, feels we're on like appreciation, could think I you price in high digits on single certainly our based sort

your that time. I equation depends inputs of leverage sort on think over around obviously, that,

Operator

next question St. from Haendel comes The

Mizuho. with Juste

Haendel St. Juste

funding the asset has, broad older buy to of I portfolio to ones. maybe how in recycling, portfolio? opportunity? your earlier brackets should assets from you large new XX%, to expect the see a that disposition opportunity play mentioned put near for term? role And you around some Could that you accretion of guess, selling Do business generate Dallas, perhaps still more we of XX%, XX% an as much

Dallas Tanner

Haendel, good question.

really have them, of behind the have right good that a is sort for market growth also if One that really home. we we a to product amazing that's But problem it, got a of have and you're things, Jon that have business fundamentals high-class mentioned it. we And it's selling a starved is now. assets valuations

different for reprice, portfolio can we renewal rebuy where may factors there's selling call consider for be the look lot -- of and an different you anytime reasons there's up whole, a and analysis a lot as at holding why and an asset, we we asset. there homes a come a so it, And several a to

And little being be expect opportunities equity bit shown a I with there precious, aggressive to environment, to us that last today's of years. think in if more couple the think we've there. certainly capital, probably recycle so are I

homes And class that where asset over our the lot market lot generally world. we back into at we most as there has the areas company allocators. itself single-family liquid XX,XXX -- want a for a being last there for the look And I be capital sell decade. marks We've buyers as good home. there located think to market generally would the sold high of XX,XXX, the are of housing U.S. that gotten as in homes are normally really if probably the home, well in good renters

high-class that's so And problem. a

sense our be reinvest we think over before, the aggressive expect update more time. makes February we beginning opportunity. But what at year. evaluate think market because little recycling If and us, laid I where like issuing guidance values of that little bit that's of as did We've to been the on again. between year. in of there. keep where a out we we'll of bit that opportunities this We terms to that, more thinking capital of of are accretively, spreads I a And a in to seller sort can that, a been mentioned at we'll on the the our based beginning relative the

Operator

Barclays. question next from with Anthony The Powell comes

Anthony Powell

up developments? you forward? on when this time-to-time, to And mortgage from risk when your from, at going shadow people that for the Do accidental update us. of landlords may comes you look to you rate want that underwrite and supply hold guess, views lock-in? you With properties longer. is Could you expect supply more current their mortgage think to I see something us to mortgage I rate on buy for question X%, on or

Dallas Tanner

just able economists on for obviously, rate. is And people. the X.X My mortgage been it we're for have more they've homebuilders, part and year, to having certainly like of buying that in years. Builders own last better has success feels sensitivity conversations had, been factor of based that, down both a tremendous do view rate with mortgage the

and talk around other more XX-year a Invitation mortgage And day, in a would get are, release. is of rate. somewhere in, right It's still elevated is was this to I a I locked the looking $XX,XXX that on buy. rent about and it to based and still home sort they now, rates this expect own. treasuries the at a it's about that, more sub-X% out the our go willingness these As people's I increases home, where cheaper that and than of we home stay XX% think probably currently country earnings year an to at in

changing inherent of the that in I terms And it that still likely And elevated this like I I the and in the seeing term. to, the sort rates higher-for-longer sticking for into with are that now. probably referring Charles keep about. think think, demand thing around those of in right If we're that renewal some business I in really new think QX seems through a don't anything, period see near that good people our it's And talked probably of QX. reality

Operator

from Feldman with final Wells Our comes question James Fargo.

James Feldman

on opportunities. to and your I to JV just fee wanted go back opportunities comments

business? fee in And then management, have? well? new entering just exact Or you new markets, of maybe -- types portfolios about a you if have you do were Or you kind strategy you and do types? home as collection JV think if the think So to equity similarly, the fee meaningfully, you more is that expand of you do purely you you stick would markets same kind stakes about types the if platform those with take of think of

Dallas Tanner

this we're your question question in. markets markets, on the markets is your -- on love Dallas. To To we

had been and some of that in you the look where space sort our us invest -- of the been large we've performance wouldn't best in because the concentrations, last country, the deliberate we've been why. reasons residential that the the about the parts running, expect had one probably the had part we've numbers that we've and highest-growth at one of And years I very is I if think we've to of historically, we've X top we in change of and philosophy. capital X

the operating out reasons we're and people we because into that periods markets longer to have well one the of think of the high services to that density are for want able scale, I are addition, and time. is being of focus that in we margins do, our on and get we XXs, going the XXs now lay right In

out meaningfully a then not scale don't to markets states for from focus on so right the allows we term. model, right continue being that over density to Homes that. is change within service the product And but that as us expect impact and building those Invitation proposition in and to you just the your And states winning long

infill question a with little bit we've Now as product more we've product bit to your some more higher around that certainly experimented type, townhome-type product and was a done some density. and little

One of the location, purchases that Phoenix. west in a quarter we of like in right product, QX really transportation meaningful community That was higher-density in good the little a Arizona. was bit off made side a

We minimum investor on you today try townhome-type aren't to X,XXX, cater those That feet a units. matters could best. the business. we us demographic an apartment situations. think footage we amenities not We and square to X,XXX to square a bit XXX that. I But remember, our that investment matter an than -- to experiment bit to square product. That's X,XXX little want be the think foot see in certainly continue doing bigger and little lends to apartment X,XXX, preferably

and out In couple of things. your One, in meaningful and us around a as question look, management, seen think an to first I terms and time have time the a trade decade platform scale on we you've our a density company margin and added X,XXX again prove that take and expansion meaningfully. over We've margin way ability additional fee quarter expansion of scale numbers. into last that we with time. integrate be believe the will It to with will our over in done we units see what that add

things our consider that are to as I things question our JV management as disciplined approach away won't around going we think we've get already to -- for have around expanded take but to give that look the the businesses, we are scale start we that business. we accretive, to want and us from property

the that And future if so margins in it becomes to profitable, our especially look and operating a we're that more it way are business things lend it's way, to if actually continue we has can going think those to evaluate. own meaningful if scale, at in in capital-light our and a

Charles controllables our So focused now business. I on this. the controlling talked like feel right about within

really from running perspective Our is a controllable business really, well.

tax up success for our I really of think future. about we as transitory is we where debt, kind near-term the get we we set this call business bad some of property through what and pandemic the noise for and are. winds of feel good And

Operator

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

Dallas Tanner

us everyone Nareit. at And of for again Thanks you to forward seeing of want we're many to We thank again. today. in couple going joining a again to look weeks

Operator

has now concluded. conference The

now may disconnect. You

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