AIRC - Earnings call 3 2021 | Apartment Income REIT Corp

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Operator

Good day, and welcome to the AIR Communities Third Quarter 2021 Earnings Conference Call. [Operator Instructions] Pleas note, today's event is being recorded. I would now like to turn the conference over to Lisa Cohn. Please go ahead, ma'am.

Lisa Cohn

Thank you, and good day.

the including we expectations. projections call, on are conference judgment, management's related this forward-looking make statements based During to XXXX statements found certain of to are uncertainties, These description a risks which our in and be SEC filings. can subject what materially may discussed be from results today. may Actual differ

come from in published question-and-answer members We'll also our will today that measures AIR's GAAP and Terry remarks release such and Keith full Considine, during remarks. in supplemental Other Kimmel, Charge information financial Paul non-GAAP part session, our which President Prepared of as CFO. These Operations; of present available operations. earnings comparable CEO; from discuss the management will are AIR's and of defined follow most certain Property is the be are prepared Beldin, are measures website. our funds on reconciled to the

call to like now would turn I Terry the Considine. Terry? to

Terry Considine

in of This be your multifamily is and you, for country, the demand restrictions interest are economy to healthy from to time you by damage the strong. few markets, business great economy There largely and AIR. all lingering the to governmental the in recovered in Across a the lockdown. year's is Thank last thanks caused has but business. Lisa, customer multifamily a the is

pricing. inflationary low to pre-COVID AIR about interest are and above more asset debt $XXX environment. or to of and, for rents at is operating team took rates trade pricing, to XXXX, raising those use net their has income. raised was billion and XX% expects his McGrath, repay OP X.X% area and sales $X.X XXXX X.X:X, in line, portfolio prices increases so those will occupancies, for also on advantage X above by lowering used levels D.C. whom AIR. or later $XXX a leverage with will of amazingly peaks the plus to demand great interest of notwithstanding increasing the track million above by Paul $XXX maintains EBITDA time properties selective that weighted above the $X excel, X.X% the of million expected so costs, fueled be interest time, by improve to be rate million units average in pre-COVID and said their too. driven Rents their been same continue of year-end long-term current Investor Keith proceeds trend to a asset It's in billion. income XX%. fair to of [indiscernible] that Washington, future and buy proceeds John a

managed properties leverage year growth so, do X expect already our almost with have the no earnings. target better With we NOI raising when Because productive are invest $XXX for Keith we to without to dilution acquired rate of we delevered equity. and more year-end million those by and essentially will his team, capacity per X.X:X, this share. increased When FFO have our than substantially AIR we investments

I Josh AIR has as thank worked a decade will a team joins and I thank what EVP. Capital as to also Investment them. EVP, successful who Officers. is hard who Minix thank Aimco AIR Group, and John Co-Chief and our from an home I our as entrepreneur returned is welcome work away people. well, important Strategy welcome together become Allocation. As Partners done always, after McGrath, and The alumnus most and an Joshua and John

in leave not positioned look And detailed Finney-Cooke Miller, and Nelson, welcoming Chair Kristin Bohjalian, earlier Committee, making and Kathleen contributors, Bob Chairman, are their Kathleen election and thank AIR long-serving to proxy work this Keltner, the week. I such their in who of future. reelection considerable to friends, for HernÃ¡ndez. to excellent the accomplishments Nominating to I'm well was of like Tom Nelson also Tom And Mike I'd excellent stewards selections. will to directors, Board, dear Stein, grateful for great chose and the the that forward mailed AIR particular, Maggie In for business, Their who the seek good

With call ado, Operations. over I no of Keith? to Head turn Keith more the Kimmel, Property

Keith Kimmel

Terry. Thanks,

The we of advantage conditions. third continued portfolio rate was outstanding. and market our to quarter accelerate, Leasing historic take base to and the positioned well

points September. blended from sharply we increased lease built Rates the As of quarter. XX%. third the for Occupancy with improved the signed XX.X%. up XX.X% XXX with with increased strengthen September to predicted, up result consecutive from up continue in to throughout month rate our XX.X% quarter the occupancy new in rates XX.X%, as quarter second basis XXth July Signed

early lease a to occupancy last the current X.X% XXXX. growth decade. demonstrating growth expect continued grow to more any from X.Xx better quarterly in revenue upside through maintain increased XX.X%, we loss rate. come. October our is is As sequential past quarter, than see than we And or result, to Still, XX%, which over more

X% our XX continued from last was delinquencies, our normal and is basis translated X.X% for quarter growth debt better at quarter. revenue from under quarter. XX% points. improvement residents at for results second importantly, financial who Most have aside the Our of from bad X.X% year into the a than quarter, XXXX. of third up the improvement the Bad the XX% strong extended Revenue debt showed

XX points X.X%. down year-over-year controllable down were with expenses basis Expenses

XX.X%, the margin quarter points the our result, is up third net ahead points our marks our income XXX with quarter edge X.X% last the XXX above apparent. better where margins is quarter second and margin basis consecutive XXth becomes AIR operating XXXX. of basis the third That a Operating year. truly XX%. In than from operating of was As quarter,

of of cycle viewed XXXX. These results best beginning are with the perspective since the the

achieved XXXX of average the to Asking rent rent the quarter above XX% same an recovered as results in ago. now peak of quarter now are X.X% from roll. ahead the rents year of pre-pandemic the date pre-pandemic the has in-place up and the end first X AIR revenue with

Across above Boston Los or with quarter XX% lease the Philadelphia, and Area markets San and individual Bay Washington, are and each. double-digit Denver second we're all D.C., our improving. markets with best rates. achieving are rates the up to from Diego that rates accelerating in country, the at are Miami are in And new Angeles, X%. X%

of due low are the results our AIR with our durable to markets and our in strong a properties than engagement; and revenue business; staffing improvement and in has effort and optimizing margins. peer-leading of high of materials; a This flat to our growth, analytics These strong flexibility all of design centralization; with automation; team controllable intelligence combination smart our investments our facets homes turnover every led levels decade and artificial more and with technology and detail with of granular advantage, expenses operation.

months edge and AIR rent impactful of dramatic Pembroke $X,XXX, AIR maintained already upgrade the X occupancy our average asking XX%; and a on leases operations XX% over while daily first more margin the on increase raised and in than underway; homes lead that XX is ownership, average new Xth of transacted implementing rents XXX in City Center Pines, began than The acquisitions. average; an more $XXX to XX%; with Florida, at town particularly will increases community all growth. we've program center At -- of new at on to

superior X by through started D.C., the we to transformation costs at same reduces the supported reducing staff centralized turn needed customer on aligning be and minimizing recent based implementing team; business; our run process of costs upgrades. our time and optimizing value technology acquisitions, physical Washington, resources the created; repair that In service the to through service;

a XX.X%. low Occupancy maintaining momentum with the growing strong turnover, XX.X% October we anticipate of continuation has or months. continue to occupancy we've built represents weighted continued rates in of for in the average an third with the increased coming Rates our average to month. And be up the quarter.

thanks all AIR My team members. to

their our our to to I serving dedication improve together building we made this as wins upon business continuously Your our to has great success. quarter drive XXXX. forward to and a look look residents

Vice President, call Co-CIO. John? McGrath, with now And to John over the that, our turn I'll Executive

John McGrath

few a the had We transactions on Keith. you, months Thank busy front.

higher of On have a on assets track are of the $X.X improve we to XX% of quality received through York, Chicago pricing New reducing approximately and exposure risks our road regulatory market. locales allocation are selling California in portfolio billion proceeds in raised We strong we capital values, average, uncertain and than with certain the to to our and markets. and law pre-COVID selective by decreasing

quarter, property we the $XX Chicago X for During million. in sold

and with contract also million have under deposits $XXX properties million $XX under contract million nonrefundable negotiations. of another $XXX of We

execution degree feel of exists, risk While minimal. it is we a

to have have has for our demand well-qualified buyers. a our buyers backup There competitive tremendous We process. been offerings, we and run backup

in $X.X end generate XXXX of gross the In units is of a proceeds. and retains affiliate in billion we Blackstone properties XX% continue sell rate by week, general of located for and expected the X.XX%. to X the into venture's entered the at of venture approximately properties. million will this interest with AIR $XXX of aggregate, the venture earlier operate joint XX% sales in in to gross a pending partner in NOI an with X,XXX remaining Virginia the an are proceeds the interest to completed ownership Additionally, year cap

Paul be moments, paired proceeds funding As and trades. will will a deleveraging few for used in discuss the

not of properties sell we of trade land to market average XX%. resulted paired X,XXX $XXX and the D.C. portfolio from parcels apartment and suitable will rents located properties a which AIR upside, purchase execute approximately acquisitions. with significant to development an a Washington, Turning square will acquisition X and to land additional those feet space of valued this in The In net of development to homes with the below opportunity to of in $XX undertake for million. increasing the by office market. reallocation a short, third-party and commercial these trade approximately market We of XXX expects X rather with are acquisition outperform includes reduction XX,XXX the but at acquired a for lease D.C. developer. The capital price a in believe Washington, MSA, or IRR the presented homes parcels, vacant million. apartment operating

effectiveness We investment acquisition the $XX approximately local to basis expect XXX flow X.X% expect it. points of years yield anticipate an internal philosophy, approach than will strong Consistent rate platform, property X% our a operating additional return the X first dispositions yield yield NOI fund and to refreshment and we XXXX Keith's in of to this due approximately the million of the cash and upgrades over higher free a with made demand. in

look elevated cautious those example we Keith's The Given can acquisitions of create a about is like. acquisition just considerable where prices, value. good for discussed and we are team what

Front the driven Range. will acquisitions, to capital we similar be by Florida, Our Southeast growth largely additional opportunistic look and allocate future and to portfolio the will

turn I'll call that, Beldin, Officer. Paul? Chief to Paul With Financial the over our

Paul Beldin

John. discuss future AIR's regarding I Thanks, our of properties, to balance will XXXX our sheet, the for and $X.X growth through sales conclude plans fund a billion including brief with and remainder Today, expectations leverage of dividend. comment reduce our of the

balance Starting sheet. with the

EBITDA transaction, to second this our Today, As plan achieve In call, leverage is set part by to ratio target target of separation of plan X.X:X. complete. year-end. we outlined the a I the this quarter largely

closed million we've million. hard additional money mentioned, contract dispositions negotiations and are sales $XXX John property additional deposits million of on $XXX of on an in of As $XXX

necessary City sales contract $X.X pair billion million currently be debt, property these to of sales X.X% under are of repay proceeds the the expected Washington, and used to D.C. fund trades. from in properties the $XXX Center The to complete planned negotiation

The in be the York, in credit will proceeds borrowings expect portfolio accretive trade will using to Maryland costs XXXX the on proceeds properties to revolving and our and Virginia those used facility. of be remaining New results and D.C. to beyond. transaction pay Washington, We selling and pair acquire reduce

in of result approximately X/XX Washington acquisition target. a the leverage $XXX the an with X.X:X, issued of expected net million property operating to the EBITDA D.C. turn The portfolio of and with partnership of sales ratio than connection better

than and cost interest the of acquisitions; we third, by opening to fourth, credit our more by deleveraging lower expense that rating pre-funding little higher bond second, of leverage earnings. to $XXX first, both metrics, thereby debt impact taking a fourth see we quarter the strong activities: meet are significant advantage million Moody's I door cash our significantly for to benefits X market flow and sell more amortizing; future public need is and investment-grade improved making target, an likely, repaying market; high from to

increased approximately The year. associated net of quarter Prefunding earnings achieve reduces acquisitions, sales the investments future leverage property a $X.XX until leverage to identified. of solution rate are per $X.XX targeted necessary our suitable to of effect reduction by approximately acquisitions $XXX the million EBITDA X.Xx run and at ratio rate slightly per approximately

last full guidance. year comments before to Two turning

last year's increased Aimco as in sheltered worth to it's $X the to alone a one. structure gains would tax. good noting The resulting of decision otherwise taxable First, subject from that been separation difficult billion that this basis year was approximately tax have

Second, debt of increased on anticipate I the penalty million represents repayments. $XXX prepayment The wanted of property to penalties debt. the comment third prepayment connection and price. the on with an improved future share incurring is investment an the in quarter and higher half mark-to-market fourth the expected About balance earnings, flexibility in financial we

year full guidance. XXXX Next,

X $X.XX the this and from per from in between from expectations midpoint, and FFO, sales offset an expenses. consistent growth quarter incremental to and X% midpoint, is our For of at We NOI the guidance D.C. the and increasing months third debt is share gave for year payoffs. and per $X.XX same-store ago. full Washington, with share Fourth are year, results. be NOI we property expectations for the we same-store loss expected At expect portfolio of time timing $X.XX. third lowering quarter are by Sequential this the now the revenue our FFO increase operations NOI FFO

Lastly, on quarterly XX%. declared dividend share of FFO and cash ratio per an AIR Board of October XX, Directors of $X.XX the payout a

[Operator With you call it for we turn open that, Operator, now up the to the I'll first question. will questions. for over Instructions]

Operator

we And Instructions] from St. have [Operator question first comes Haendel the

Mizuho. with Juste

Haendel St. Juste

just I management addressed of you some side. pretty fund remarks. why and I'm question why your been more portfolio side And on the busy now the versus why your on curious say you've investments guess the new on in equity. Terry, disposition

as units OP the there. a guess some of enough of to the you're used I -- transactions, You comfortable part one degree so

long-term you maybe to be color differential, would then on your if could in appreciated. XX% alluded I'm was IRR, increase IRR and the returns assuming but curious, that some guys comments. So illuminate you in an there

Terry Considine

at my dear Haendel, you've comfortably will will of I'll inside asked time And knowledgeable. call friend, fit John McGrath, rule. a be question on who X Well, more questions XX that for some those, our

it Let's are doing are now, with at reasons. beginning just there why I the X we start and say would

is we company, first we do The say. said the said we We that we would to we what and would. delever try

and we interest that confluence what and thought an rents aggressive and there made X.X XX% attractive the rates unusually buyers properties second chips it time years is to reason we was The table. that provided off was very very attractive we these of pricing, a ago, low -- high good thought rising take and above had valued

The Oh, question Help what? was Haendel. IRRs... second me

Haendel St. Juste

Exactly...

Terry Considine

in more control as disciplines right, X applying that? Mosher, team, can very D.C., the comes advantage properties, techniques the those acquired comparative our the to we you of their The will across Kevin in about Florida return, it's D.C. cash in same and you're the add rate technologies the flow portfolio to Washington, cost margins want I'm IRR, hands. operation D.C. Washington Washington, [ talented by same internal or and team, taking in you the sorry? productive XX%. Keith in IRRs that operators. in whether would from in are increase to a John, in and see of increase And free our his and ]. are Coast, in who advantage East runs good And properties

John McGrath

the I Keith driving Terry, comes is No, down think It team to advantage. his our and right. you're platform what's and

Terry Considine

skipped over? question Haendel, have a a did fourth or that you third I

Haendel St. Juste

we're I Clearly, next relevant lot Keith, a you Terry. with question. No, potential a transition keeping very, we costs bases the ability move taxes, maybe in few can No, could obviously, of think the to I a very platform, job cost into your worth, environment as and some effective comment a that rising and the thinking Maybe that some you're costs? done you've my about might to R&M, offsets our the low. like use guess those those over with we here things I environment offset to painting cost in talk maybe last operating get if wages. control effectively money's of portfolio there. years higher your covered last expenses

Keith Kimmel

evaluate at from ability team seeing things the that back can and years we've look as see that variety things. go a record, we them, held them, Well, and of staff over XX the way be And of is the Haendel. we on-the-ground in look operating that an that the past and Sure, do can what in other price we track many, you when goes controllable right? looks and as many way our we everything particularly efficiencies, And the our essentially, we expenses. opportunities. technology And at materials, is acquisition the this, it units, course, like we

forward, As fact. to know in work there's we more we look be done,

And so while there's these talking get we but to we're improve that current even within think portfolio, things about, the we've opportunity better. been that our able valuation to even buildings do of many

Haendel St. Juste

offset the Sure. No, on the be could taxes, potentially headwinds in I expense on how a also but big that those portfolio, pressures, the taking us the also turnover tide, your or that of Any your of wages, curious meaningful appreciate prospects are platform? where that, et assessment guess, R&M, to cetera. from the but portfolio the drives of costs technology maybe various the of I that near-term kind could color be the higher sense cost maybe

Keith Kimmel

of cost about I'll wants continue ways to, think would inflation him some going But piece. no we referring the of in to impact, to there in, how about different plan this Sure. Paul tell to we're of get I'll question there. is question to goods I and And Haendel, find you're if have operations what but be to will some speak add let What that there's and even I better. things be you a anything that. like

the the one parts things important of that our most on-site you And just is an the give example team. of they're I'll so focus one on happens. of that We think success we that

customer things a result we turn, that work, of so then that using of lower because team members and and higher reducing is creating wages, provide residents. into with easier. put fact, turns have better with turnover turnover lot jobs better members in durable jobs on that our we in faster our And by and the better making turns make less -- things goods we which energy team And into satisfaction for happen

we when have so And costs. have residents less out, we less moving

And so inflationary our of around will reduce but just energy those environment, when of we're the at types like customer customer not are selection, long things put going onetime hit, we satisfaction, that cost, over a time. period areas to and a look that an

Operator

We Alex now the Kalmus have next question Zelman. of from

Alex Kalmus

did I are come the want upon Blackstone it the with you How And touch to on economics affiliate. the fee side about? the like JV for what there?

Terry Considine

we've to X John, What a more but to and useful would other founded about each you relationship. between might want the known it strategic long and we companies, because speak relationship that, came you add?

John McGrath

an to Terry. were platform. that, to relationship market add to assets the into of enter right, we the Keith's I we believe agreement That's that Blackstone take where would an advantage pricing able because we is mentioned, it we only as thing that are have I The advantage retain of with to have

property I will we we positions. and On the fees have fee associated the mentioned, manager, the the at we with are are those and as side, GP,

Alex Kalmus

fee guess, on Okay. these side? looking there anticipate you I that rate any, Got ahead that the will it. generate Is run

Terry Considine

No.

Alex Kalmus

is portfolio? on the looking just portfolio. any to And I greatest in at the where specifics Is market-by-market loss loss the lease, to appreciate there Okay. lease the commentary the

Keith Kimmel

Alex, it's it. I'll take Keith.

ability future not, that to comments we demonstrates loss lease the to And the increasing XX% rent to look even our incomes profile, of selection would are is a Boston. And stand And a our one as is really out, point we a you would seen year X rents. rising actually Miami, at a well just dropped the that I is XX%, at look out, even like current course. that just lot As and of growth. the Denver to opportunity though XX%, have loss which at but our that fact customer resident we've were wages. have at quickly in the of has to maybe or really lease, add places is our what see year we income later to residents as demonstrates ago, top ratio at of we even that market as obvious our place our as that couple when of

Operator

We John Green from have Street. Pawlowski now

John Pawlowski

comment what are any context to one Boston. market? on revenue there? programs Curious you the almost just your follow-up provide the drove there's CapEx revenues that Could if Keith, XX% specific large sequential some in rapidly increasing

Keith Kimmel

Good question. Really X pieces.

stronger an We're at we've in that first, The XXs over even the up year. built been running occupancy. the high

In those payment at rates were a a addition gave blended that, as we that were components tenant X catch-up. then had from third, a us mid-teens, in look we commercial to our the And part. a big that

the growth. you when combine those things, that's so And

John Pawlowski

Okay. across Obviously, very the fundamentals are portfolio. healthy

look Keith, you just dashboard, your concerning you've the the most operating as what's change lens, your months? in in seen few last Just from business the at

Keith Kimmel

our anything about, things change. at year which a the that we next at with that you, in is building that ability just in-place that that big greater say they for I'd the will I'd I rent, out point was spread build say the opportunity, to even high spread opportunity the year lease. are strength. going to but we rates incomes that opportunity loss believe we're that qualified into the a that's there's I'll further our occupancies into of John, great when ratio, and with a out have a there's versus highly the that and move, rents I in we're to great end concerning excited I is and asking residents look tell say not would current there the the say income would point look that us that wouldn't

Operator

a Chandni question from have Sachs. Goldman of now Luthra We

Chandni Luthra

around strong question a basically Aimco. with My quarter. the relationship first is on Congratulations

there, on are So of say, you wanted provide any could have be? now that redevelopment by, it how think to about near perhaps you provide you leverage how come where if consider will properties the future? your could them update And should to that you the -- expected timing an you in X is those we properties

Paul Beldin

are Paul. Chandni, fill Aimco. from hear wants is with -- in of I'll once the lease-up option. anybody and are those stabilization properties right, properties. properties those our to Aimco's have we be see of at else if X those to is X the you're process. are this Under lease the question you. And terminated And terms option Nice Hi, and start currently agreement, in. But that can to reacquiring those lease leased And of that that done, have we stabilized, if that properties

has that not terminated. now, right been so And lease

And when bridge and a that decision we'll that are come time. it, -- so cross we'll to that's those we at make

Chandni Luthra

trying you Got such talked more what follow-up understand you're that it. the the Blackstone landscape like? to just considering? there question JV looks Just Are that on about. And a deals back -- to perhaps then future

Terry Considine

Chandni, Terry. and can from all the great fund we look We a this we'll cost lot of environment is opportunity properties where to see the team We of sources lowest find. value, in capital. of at those Keith's adds capital buy

Operator

Markets. a We BMO Kim have Capital question of now from John

John Kim

the portfolio different little rates. a rate break dispositions high results? to it market by cap down to any Is way cap there seems and to relative on calculate The

John McGrath

is this McGrath. John John,

a But a they If are we're will I say seeing break lower Prop cap the a than it I'll rates I can't perspective. cap look rates if be particularly rates by what is that the down California, Prop we XX. from XX First, look perspective, cap without the buyer's hit, what have where at market. at

it, look I our when financials at see is XXXX. in for from what mentioned our what what and numbers And you're and portfolio seeing so you our we

John Kim

another is to heard trailing forward But we Okay. not higher. XX% presumably forward X% what would as low The sale seems [indiscernible] number. for transaction. a not number, just the It a be like on as rate cap the

Paul Beldin

John. Hey,

for you, to in just going Sorry interrupt rate was Beldin. to we're Paul numerator this the on is John, calc. and I the using comment cap jump

for so And expectations XXXX. full year our using we're the

and a hybrid kind that trailing the it's And rate, quoted pricing being sold. somewhat. is So I is that cap commentary would are thing around of forward so John's between influencing California another and the reinforce a assets

reset what a very And different perspective, a than a so of we from the of and, buyer's would portfolio assets. the property level significant experienced, a for taxes the rate that on valuation and therefore, effect that who's of have underwriting property cap

John Kim

mentioned within elaborate think exiting Keith on remarks that? I you in certain the Can markets California. prepared

John McGrath

have John. you certain exiting at -- those which an we're higher not necessarily of they if markets, and high looking looking is is This but markets at also needs. are What risk perspective, underperforming, law, but from will, have from capital uncertainty some where regulatory market is and asset a rent lower than

increase quality Keith's have acquire assets to we're using by upside. significant is what where we portfolio looking again opportunities platform the So will at to

John Kim

in were you I -- over felt difficult to been couple Okay. of that the more mean, there more like challenging operate certain jurisdiction years? cities has last the to

John McGrath

on asset where an by came we that's We portfolio the things did with looked our up asset and basis, list Not whole sales. and really. across of

calls, recall previous we've talked process. about our California, part and John, to And reducing on this you'll overall that of allocation is that

Operator

Nick have now Joseph Citi. We with

Nicholas Joseph

in For will sales? outright California those be could JVs? Or some those sales, asset of be those

John McGrath

question. be Nick. They is sales. outright This John. Great Thanks, will all

Nicholas Joseph

kind JVs pretty keep next simple. simple? the But guess do Blackstone the JV [indiscernible] more [indiscernible] the one AIR of then. sale an the why even are my guess just would outright of of assets So be I objectives just strategy I and not on question of those

Terry Considine

equity on leverage there relationship. we value, have weighing multiple that advantageous in returns, add the case, Nick. opportunities weigh, and this it It's that levered capital. we balancing are our -- factors to It's found to platform, maintain And just returns on

Nicholas Joseph

on And then OP was just the the finally, units portfolio? D.C. pricing in the what

Paul Beldin

They're This upon a just average is ended priced Paul. upon a $XX and of about unit. transaction, up trailing the that the being closing

Operator

Richard from the SMBC. have line a now from We of Anderson question

Richard Anderson

maybe currently, that Sun could Belt region at areas Belt performance up and the benefiting up year, opinion? a offices a we've a building is Sun strength the a for and perhaps year, open in next different of in ahead market. all fair the it there Is So open perhaps coastal the bit cities little Sun your that statement convergence reasons, more lot foretelling as as coastal be the the Belt in gateway and But margin? open of coastal is coastal up, the of a seen, and strength next year universities

Terry Considine

you. to Rich, from it's always good hear

will but think be the lockdown. by explosion right, exaggerated is enjoying it as demand comparison X-year that numbers The from for Sun the the, recovers change. The year-over-year different you're Belt I somewhat an to of are economy just reasons. say,

And and try taxes look overall down so and more The markets have high economic such coastal are to pressures slow so as and population forth. XXXX. sluggish growth locked growth continuing back to we and economic

they're -- different and So they're just cycles. different markets

And cost the likely to I a dealt more pricing in Sun structural they but coastal think to be unwinding Belt that positive, markets, new of you're problems that with. markets with of lockdown have you're in going demand, supply. the have limited to by the the will have be but continued

Richard Anderson

staying overleveraged. And maybe agreement this on but you, the other of simple, you And outcome. company, new reasons, opportunity complicated I and net in you met mindset of name, was offer not while to company arguably the XX going Okay. similar future? I now, of to that, with time, at are this terms incremental bit I'm middle dollar some That's simplicity Or kind have then other XXXX. the later a Terry, sort words, a book now And a or in in In holes be you the think years of of Does complicated -- move different then, and any deleveraged. those down perhaps in place of maybe in complete taking going the risk? ends? X little in an rabbit I

Terry Considine

It's it's AIR simplicity. comparative have -- about rabbit transparency. we But the exploiting about all characterization heard all accept advantage focus. reducing my It's appetite Rich, I in operations, for all is about the about hole. of and you all It's risk. about

overreach. to quarter avoiding this as the talked in financial time for about, by exposure risk, But development. locales limited portfolio we've in sheet. reducing So with on John we've also risk reduced risk, balance we And spent example, regulatory

of not and risk we've affected always chain key good supply of control dislocations guess we're And shortages. costs. had I our So is labor part by a

effective So see to want own benefit have the we that any for the to most we is where don't more efficient, AIR, revenue to make most shareholders. any And converted reason complicated. multifamily, simplest, is what the highest of way percentage of to

Richard Anderson

Yes.

not to rabbit little a take to not go mean, But it going But keeping the are you're to bar word. the enticing for I think down is bit risk and right on allow you're fundamentals the be going fundamentals, might low hole of because I saying it. just anymore.

Terry Considine

cap the prices there's in every by lowering by And have think risk cost-oriented economy frugal addressed we market. this It unfold. with so interest and are addressed a risk That's being could we lower I and plenty rates that's and market, could so have high longer And risk risks risk ways and a in sluggish more that interest we've this low are our It's that leverage. and of you that forth. rates. that lots quite economy. higher of unfold continued rates the

how in So a result any more balancing ability them. productive Keith's which properties that to and be make outsized it's returns. of But I a always we're anticipating risk advantage in question scenario, will almost and will big think, economic

Operator

[Operator Instructions]

Terry Considine

help, want I all your of I for thank if you AIR. Operator, in further you no to and are the there want your to on call thank questions, for interest

of many and couple well. in at see Be of forward look various will conferences, to weeks and a We at we it. you NAREIT

Operator

Quarter thank Conference Earnings Third joining has call you for again Today's now concluded. AIR Communities XXXX gentlemen, Call. and Ladies

Apartment Income REIT Corp - Ordinary Shares (AIRC) 29 Oct 212021 Q3 Earnings call transcript