UDR (UDR) 26 Apr 182018 Q1 Earnings call transcript

Company Profile

Participants

Christopher Van Ens	VP
Thomas Toomey	Chairman, CEO & President
Jerry Davis	COO and SVP
Joseph Fisher	CFO and SVP
Warren Troupe	SEVP, Corporate Compliance Officer & Secretary
Harry Alcock	CIO and SVP
Nicholas Joseph	Citigroup
Juan Sanabria	Bank of America Merrill Lynch
Richard Hill	Morgan Stanley
Austin Wurschmidt	KeyBanc Capital Markets
Richard Hightower	Evercore ISI
Dennis McGill	Zelman & Associates
Robert Stevenson	Janney Montgomery Scott
John Kim	BMO Capital Markets
Daniel Santos	Sandler O'Neill
John Guinee	Stifel, Nicolaus & Company
John Pawlowski	Green Street Advisors
James Sullivan	BTIG
Wesley Golladay	RBC Capital Markets

Call transcript

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Operator

Greetings, and welcome to UDR's First Quarter 2018 Earnings Call. [Operator Instructions].

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Vice President, Chris Van Ens. Thank you, Mr. begin. may you Ens, Van

Christopher Van Ens

Welcome to conference financial first quarter results call. UDR's

forward-looking of historical, supplemental quarter Statements to call, were section financial In measures press comparable all first requirements. most measure have disclosure may supplement, the website, are statements. we the which release Relations to posted Our G non-GAAP and in this and package accordance made reconciled Reg ir.udr.com. constitute during afternoon distributed Investor not directly the our GAAP yesterday with

do Although no believe in be forward-looking [Operator a our forward-looking to Tom we and our risks expectations update any I to Instructions]. the UDR's not any in assumptions, will President, undertake detailed of the our press statements reflected reasonable on included Chairman, SEC. and release in call statements. duty Toomey. we are are now risk met. filings will expectations turn with and assurance over based A discussion can CEO factors We the give that

Thomas Toomey

you, XXXX Conference UDR's Call. First Chris, Quarter to and Thank welcome

who Warren during On and today the as Davis, and Officer; well Operating our Financial are senior will Fisher, the the Chief as Q&A officers, me portion Chief Joe Officer, Alcock, results; available Jerry Harry who with will call. call be discuss Troupe; of

pricing towards XXXX supply, will we to XXXX's view bias strong elevated new solid a job against the results our provided accelerating contribute power These reform XXXX similar be which growth and factors, relatively reaffirm to ongoing February, net first positive. with in anticipated weighed quarter back growth Our macroeconomic being apartment occupancy outlook that in levels. when we wage a and tax

strong for backdrop Taken a altogether, apartments.

on a world. UDR our the prospects. continues in to Moving team First, optimistic produce volatile on, results steady Why? is operating platform our

prepared during While further are the leasing our Jerry success remarks. up near still we will season. early year, highlight the set and is entering in his is XX%, occupancy well peak it

Second, with expectations. in and lease-up Boston is leasing versus and some our development funded, line our with reaffirm that pre-leasing at materially $XXX again, developments Strong XXX in Huntington XX% and rates Harrison rental velocity in pickup will XXXX. aggregate at million improve XXXX City, of velocities X on view Jerry, earn-in development Pacific these communities. will provide large our color in Beach, a

Third, our new included capital a during and $XX of and Disciplined of repurchases sheet balance deal. Program share remains liquid the Capital use quarter million the funding safe. of Developer

additional provide of a remarks. all the opportunities hard special the continued We on Jerry. call to more variety will investments. Joe results. another produce continue your that, focus in With solid to quarter of will his details in for UDR associates underwrite I over thanks DCP with to prepared our turn to a market work a Last,

Jerry Davis

another to Thanks, operating afternoon, Tom. announce strong everyone. Good pleased results. quarter of We're

First revenue X.X% were represents towards are which contribution initiatives. and respectively. operating long-lived our NOI, pool, our including total pro After same-store which quarter year-over-year and and were urban, now same-store heavily and product XX% NOI respectively. X% for communities, A+ weighted rata X.X%, JV growth of lease primarily of from by a blended is driven X.X%, technology solid and revenue growth line growth top supply, results new X.X% NOI robust and These battling and were rate

fronts is season. seeing as are year, it leasing a approach what the on While early we prime still by encouraged the we're in we of number

positive the higher seen XXXX. the our same for the lease rate crossover since year-over-year the during spread quarter last year. is points XX first This growth quarter first have we blended basis of First, period was than

quarter. by other grew income Second, X% the in

early XXXX. increased and since grown which program, rollout revenue-generating specifically its which was parking, this nicely our shorter-term quarters, initiatives, has past in our As in by leasing by XX%; driven

business. our comfortable pricing our impressive shorter-term XX.X% estate our was quarterly to for last given card elevated lower overall growth expense our these especially declined quarter to at with Third, same-store to on declined X.X% achieving throughout expense of year-over-year tax X.X% leasing our in turnover. This We by when and X.X%. combined while the were rational should result rent initiative concessions turnover XX%. was season. pressures, XX% cost factors, real us prime X.X% declined a that more controllable by growth higher continuing X.X% gift well our These guidance efficiencies for And points. fifth, our leasing expense is up XXX remain Fourth, than of note, environment the occupancy, down indicate year-over-year. during Both set expenses focus lease-ups. by with due due our year, Of personnel basis particular

Next, while majority few a with To outperformed the supply result our line vast are performing expectations The pressures. of of has as original forecast, Austin markets. with exceptions. of markets has in Orlando new rundown our date, struggled a meaningfully

markets for small relatively both are these reminder, UDR. a As

turned XXXX City. growth York during change in This positive is New result a so the negative in dynamics. than quarter. quarter NOI revenue and first first market same-store of Year-over-year realized more Regarding of the the one-timers

growth XXXX. We continue New York to forecast during in slightly positive

Pacific the rates Beach, development at pipeline, We from and with bad debt move-outs million to our at at leasing in low continues first X.X% in increased quarter. expectations. $XXX All are minimal original home Huntington increase to in pressure rents. saw Last, purchase XX% our are expectations. underwriting rent lease X% million rates completed. was with rates expectations. generate aggregate, reception of on. are in first for communities' Boston, quarter move-out May we at ended remains in XX% early Likewise, with reasons levels rental Moving with velocities first and leasing quarter enthused or of pre-leased underwriting deliver during and City by with development and quarters. our velocity In date. previous consistent line project Harrison, XXX the at in leased today, line our sit We our rent quarter XX% homes to the today, the at At in significantly the during $XXX all XX% construction line XX% and with We ended as net

JV in to budget Addison, of located to Vitruvian Similar expectations. remain continues West perform and on excess community, two Our well on underwriting in Texas, last developments our schedule. quarter,

Our Los available and community, Attachment quarter-end vision performing line Wilshire are is expectations. located its lease-up in statistics in opened of Community-specific, our doors Angeles, X with on on recently supplement.

I to another would over the at that, of Finally, I'll for in like quarter. again turn thank our all corporate With associates to field it and Joe. strong

Joseph Fisher

include Jerry. and transactions a I update. quarter sheet today our and results and investments markets a forward will update The and balance Thanks, first guidance, topics cover capital

ranges. adjusted, and came $X.XX midpoints as $X.XX. AFFO the earnings results at provided share were of per Our first quarter in guidance and our previously FFO

to you AFFO $X.XX First supplement, results to our capital driven year-over-year, XX details of operating quarter would latest or Attachment direct and was disciplined I up our guidance X% strong by decisions. which now like expectations. allocation our

ranges. XXXX provided growth as year and guidance We have previously AFFO reaffirmed adjusted, FFO our same-store full

For the second our to are to $X.XX adjusted quarter, for as $X.XX AFFO. guidance for FFO $X.XX ranges $X.XX and

Next, transactions investments. and

announced X% quarter, Pacific million Shores, Orange XXX-home community previously the yield. at a sold in owned a wholly low County, As we during for $XX.X

Regarding development.

to to over desire restock the sheet a continues be add to balance Our goal. our time pipeline to land

foreseeable located our to in purchase mind, difficulty sourcing the development closing With Denver into in fourth land a quarter. economical opportunities million of satisfy located XXXX, are disciplined pipeline the subject Capital expected in entered $XX to $XX.X California contract the a acquisition return close future. quarter that parcel our the land XX%. invested customary In in XXX-home our we a The into at in Still, shrink is markets, for current we this a Developer during of of given to will our there conditions. Program, many underwriting continue million to However, in approach. Alameda,

investment located Los hold DTLA, joint as for Angeles, transitioned with venture and an the effective a X.X the Coast was maturities balance million yield quarter. the $XXX option purchase community At all lapsed addition, take the in mid-X% that place next longer-term to West In our at of years. quarter-end, range during period over development XXX-home a DCP

assuming to DCP parameters. further investment in continue our opportunities satisfy favor We our program new

capital sheet. and Next, balance markets

NAV million quarter-end, as $XX an strong capacity cash of balance, commercial net credit by shares in of the facility our of $XX.XX, price of liquidity, common return to stock. During at measured given the risk-adjusted paper we capital the discount and and average At quarter, use was million. prevailing our our repurchased a inherent $XXX

XX.X% financial on value, undepreciated inclusive Our and ventures. on book value enterprise joint was leverage of XX.X%, XX.X%

increase actively consolidated although and lever look later our Our to up lower net comfortable to for and to down, it of XXXX, With and of the forward NOI commercial improve pool. depending our the joint on ventures, debt-to-EBITDA inclusive the continue unencumbered was sheet, balances remain profile was size commitments. we or capital X.Xx opportunities likely NPV-positive plan to credit paper in don't see will X.X-year you metrics regard our of our of We X.Xx. with duration our balance size

Finally, common quarter-end. the we Operator? X.X% it of of dividend With approximately will in at that, for declared yield annualized first I up quarter an Q&A. for $X.XX dividend open a

Operator

Instructions]. [Operator

from Joseph line Nick question the comes of Citigroup. Our first with

Nicholas Joseph

through if contemplated. else transition versus asset that anything selling to Coast decision wonder you or I walk you your West JV to can hold to long-term

Harry Alcock

like our to Nick, you, that to due with headwinds due up our we supply. term short-term tell value, agreed a be the I'd with where on and some we nor buyer seller term, didn't return is Wolff, based asset short price. downtown we a Harry. realize in the term. below-market our want the long there's volume this Therefore, hold long L.A. ended partner, is to but

Joseph Fisher

Joe, to about at that, how of execute around guidance into is fact stock million. that able a buyback look only And if we DTLA, pivot were the we on I'd our in actually buy is not the did thing we some to planned The terms over those uses. a of this you $XX uses add just moved

on effectively low midsize we our for a So stock. Xs a traded cap

Nicholas Joseph

XQ the mentioned you 'XX then XXXX? lease terms first XQ 'XX. growth of the positive maintained quarter And is being rate that blended than with guidance in throughout spread in higher assume the Does crossover

Jerry Davis

so guidance to And month Nick, look right XXXX. it into last as Right assumes being really top the now, about we this slightly it's going to April, were ahead. in Jerry. see be with we're of even where is the continuing we year, of maybe on

for a would blended full it's may was we up on where expectation last the depending growth be it the probably in the when at year. year, little which yes, think look to you But be the high mid- going rate season about bit, right Our goes. is Xs, how it broaden to leasing

Operator

line Our comes the Bank with next from Sanabria Lynch. of question America Merrill of Juan

Juan Sanabria

same-store you seeing you're trends from the today, here What's a trends? upside relative the could or Just the us second on to revenue either guidance. downside give renewal quarter midpoint? any sense on and And risk of new

Jerry Davis

at to quarter, But as new, jumped up again, to second higher, the This X.X% seeing rents, like just had be X.X%. typical Juan. of at new in come of than lease now, we're a when Sure, modest. a Jerry. we Right April, normal X.X% said is kind in from to growth now, in you as February, quarter, it's it X.X%, seasonality. first April as and which, But you we Xs. slightly the it's for Right last seasonal seeing -- negative for quarter is negative progression, went of low rate look going components it it it's is did that, expect. I we looking But the January the would then In first blended or Nick, the look we're April. had to

that's we as second pretty in at summer. came expect renewals, come look you that's quarter. about to first increase where quarter. in the We the we in. and static quarter, And those looking to a or When is progression, revenue the continuing throughout right X So the revenue what the growth expect had we for stay April around X% year. growth in the throughout first would would On the

leasing concession season, as much expect and you, of in last to And look as it's our were leasing gift you on prime not revenue to guidance, is today, dependent the leasing slightly bit you we're being X.X on remind this when a quarter, levels of to season. second beyond increase then with X.X. When the position at and and of do the good the they season. than XX.X%, year that we going into We the lower get a of But year top heavily you occupancy in the how second of get quarter. guidance again, cards, our we feel reliance to bottom say middle pretty the in strength

putting a is to income, to top a that, to a look get later pickup downturn bottom the It's there's in XX on in it at as with right which of well we're really get the of of other seasonal basis So in year. half growth first the unless midpoint the contribution rent the this really additional when from a about probably we what is quarter. points be difficult going as you But continuation of revenue takes upside, rate would ideally, uptick. in levels

Juan Sanabria

Great. What's And just be just conviction one financing? me, in to more will, on down access And for across construction thoughts any that deliveries just your supply. 'XX levels then stubbornly but volatile, fact, question of the on permit markets? level on the and high general comments supply

Joseph Fisher

this is Juan, Joe.

account see and that's in we of was our XXXX starts difficulty last year model, with cost of we hard the and really take on think land, So the a look factors, bit activity, regression qualitative 'XX when difficulty a in look rent Obviously, ticked coming then overall more activity, the in I see spoke permit activity the down to type exceed bit. number. back our starting from the XX% That saw changed But what we when therefore, XX% and all meaning has requirements. from flat both which view when outlook a the down growth, at don't little supply throughout at start continuing the permits kind is about to on side, fuzzy when difficulty financing 'XX predicated quarter we that we the construction into return we finding up levels. was permit-based hitting 'XX, to on the little of

be have market-wise, 'XX, markets still flat difficult Austin. in probably meaningfully. probably bit view our be little in those you down up think and supply L.A. might ramp that see with maybe a are Orlando, I overall, California. think we down to environment see we're more Nashville would and But a even flat would Northern D.C., Orange XX% And County, -- more and to up

Operator

comes question with Rich next of from Hill the Stanley. line Our Morgan

Richard Hill

cities Southwest it I a Austin much more in cities. the portfolio micro hear and dig it's in the Texas, state wanted a market maybe to of seems just to areas becoming some bit even like increasing specifically, Dallas. We demand little within about nuanced between and and but

So was little maybe weaker we bit the than Southwest a were expecting.

you How you're market seeing, just focus thinking maybe Dallas. point? consider market? about the you this curious I'm Houston what on Texas Would at So about are the

Jerry Davis

doing the there. getting village to area supply we're gotten Addison I that's from area. 'XX months. for extremely opened impacts supply got you retail was has And rents. offset to job Liberty leased project Park able, to guess, X.X%, our And be Dallas B as next bit more our jobs But JPMorgan strong last occupancy at we X down as slowdown legacy and been of put some North XX,XXX about not Frisco. growth. especially we in Toyota, the in our the of Plano, seeing doing positive We've would maybe over in. seeing, what you're they're properties we're new growth I'll since jobs there's expect down Mutual, months extremely the start or continues X,XXX-unit Harry growth and than months into not can X the about Dallas, first in heavy expected then we've in And portfolio, those results well. new supply, from revenue the last with property revenue area, about pro of Dallas assemblage. property look in new in little there for also, up or far what markets, X new couple -- currently, got about we've up the into XX%. of definitely and forma Tom when we're markets Vitruvian jump But there, But -- in the doing year We've X%. that coming about And that fourth we've in a in We're is in well, it while currently on a

a it submarket-by-submarket is issue. So

go. predominantly do area our it's product doing B is to well. very Addison property, doing tending is where But Uptown, growth really our now, just there. the what's though, XXXX is growth A+ same-store on and numbers story. revenue Austin, it's we extremely in in that was strong So lid is seen difficult can to It It is product, now well. higher our area. -- downtown stronger affecting about Park is of over Cedar with growth you And interesting, one have down about homes MetLife in than where heavy which job came up really rent X,XXX venture coming even jump growth there, couple But right that X.X%. same than when X.X%. is putting B joint years. product, well. What's we've Then is Plano new Job but some is area. last at the in of product of supply heavy a

Downtown and pocket. it's Austin some by to pocket bit but submarkets us it's down growth, to moved up points. is other and price get starting a So loosen to allow

Richard Hill

Got in at to Houston? it. anything you in and any Or And sticking this opportunities are point? your -- Dallas knitting Austin seeing you're

Thomas Toomey

I exposure, in our to continue -- Dallas with Austin is think respect to comfortable opportunities us and this at particularly X attractive and to very Houston those -- Tom markets. time. we'll look is this we're for not

Richard Hill

Joe, you. Okay. just one -- maybe for question And one quick

little lower DCP trended looks program, where bit than it's like the maybe it it's a On recently.

You to even little back million, think you a bit $XXX higher? maybe that get up can

Joseph Fisher

markets construction the want in we have term. to And when to the Rich, may comes million, soft we on the get be driven we is obviously, assets. duration and placed an a it that nice. that do come accretion ceiling long out in then goal, that time is we've have from future, pretty want long don't we point want our to earnings asset to would by really earnings that despite our own But it an back $XXX financing fact squeezed cliff these on at around

about another that $XX in million, of assets of have we related DCP the it, So other funding are down XXb. bottom call the to

to over $XXX his that take trying will Harry additional still And are to hard work at team get roll-off us or to future find said just I backfill that and to try any to assets So million. million. $XXX

I think been that at account taken guidance nothing's this some but we'll hopefully this into some within have point on front, year success at point.

Operator

comes Wurschmidt line Austin next question Our of from the Markets. KeyBanc with Capital

Austin Wurschmidt

Jerry, seeing the mentioned rent cards concessions one, as First that are flip curious and are How year-over-year, gift I have guess, you are the And trend just any for on what and And year what you I'm biggest you progresses? declines? pretty expecting do you that? increasing, that abated side? markets the to significantly markets expect

Jerry Davis

last to fairly significantly. compare Markets say you New stay little year, as York. most I I it's bit modestly. to are expect concessionary stable that to wouldn't wouldn't more go in pressures think I up. significant. down probably down They'll a concessions Seen

new now, San Bellevue through And That could get are went are our right X,XXX specifically up delivered. down. last Francisco, units this feeling supply. it's to another fairly year properties properties area, perk stable. and Our SoMa new then year less XXX supply bit when a little later We

is those So the markets. most of in decline

Austin Wurschmidt

Or bit year a said something of growth -- related component those bit. headwind? revenue that expected. sequentially a to decelerated you on with sticking you Blended provide just rates yet of color Is income started was Can out market last that when there in up better call, year-over-year, there? a been bit. other Fran think, timing the leases It's a maybe that and just than lease the San were little it I bit the a And was hit? a

Jerry Davis

not It's still income. really doing other That's well.

the continue I to should think growth revenue of as as San far Francisco accelerate the rest throughout year.

as done prior the you know, it's at You're over what you you've -- when buildup off still of, playing X a revenue, quarters. look

outperform, where blended So been of XX came putting first encouraged And Francisco. strength to, in we're of Salesforce slowdown it we we're the rents of over District, roughly seeing I have stabilization jobs but last A expected some into the we San so that to or a won't -- in really a the strength growth strength, now rate while comes. But that's we've unless come of a looking think that I right Financial the that are there's building say happening into days downtown -- lot quarter in opened. it should bit by place the help area.

down feel in job new Peninsula. seeing And in the though, quarter did creation Mission this we some Bay. You're weakness, in

Harry Alcock

Harry. Austin, this is

jobs. leasing other volume in and XXX,XXX pretty of single-tenant in quick, it's our to taking mentioned XXX,XXX at taking at feet. Bay. pretty taking high-paying real to jobs, future both are the feet square Uber square of of if feet lease is It taking square Salesforce And Mission tend that's is is -- point. Bay, XXX sort square is one Jerry Fremont going XXX,XXX of remarkable There's down at Just place project. sort activity XXX,XXX you be in but remarkable. office look rumored feet. really Mission come a near Dropbox the the to where downtown these

Austin Wurschmidt

was color. Fran the Appreciate year? What revenue assumption for this your San additional

Jerry Davis

We high of I our typically... guidance was want gosh. end say range. in it Oh, to the

Christopher Van Ens

got off. He cut

Jerry Davis

Let's move on.

Operator

of from line Hightower Our Rich the comes ISI. next question with Evercore

Richard Hightower

the was So there? impressive as what you FTEs on It's same-store seen. related start a detail color reductions to the or Was -- to the little compared the that I maybe Or expense Can Jerry, something quarter. during what bit models? just labor some more to of pretty was it other trends to driving we've want success you reduction? staffing can in

Jerry Davis

Sure, predominantly you brought up. just Rich. was It what

We at and X.X% give were the X%. gave can we X.X%. tell each that the you, down year, beginning I raises raises of Our and personnel was between

several more the people's efficient increase reductions looking -- But or either year, to of percent cut started in we technology year in compensation. create a workforce out late of late to last field. through continuing are workforce, just staff middle our last we at to finding So ways

in the decision, was of is lack want we though, first longer thing, waited open because quarter, the probably it -- to but an than we second would of The labor. available

staffing little of the find bit reductions. people. was smaller right as it purposeful a we of was A to a longer little open holding So portion positions look it bit

would you through slightly Our get flat. year, maybe be expectation, negative the be expense would personnel to full as that

So expect I it. still X.X% down be but to good over the I it have we're remainder for wouldn't X% to of the to going think year, control

Richard Hightower

All right. where of has divergence Are follow-up the helpful. you think And an That's quick portfolio as issue where A you assets where supply noticing described? tightening that across those and and more then B you're that a between there. you just lead seeing more one markets to expenses grow assets or maybe labor might about different reductions might been

Jerry Davis

Yes.

I as B on at we think that hard. assets found garden looked were reductions we predominantly really it the

pricing the wage or people. heavy in more there's you're from prevalent in finding I the for pressure, think lease-ups specifically being locations A where competition assets, urban

Richard Hightower

Joe. next for My is helpful. here probably very That's question right. All

of there sell should in terms Just the the Or predictability about communicate is a a terms is you're investments? cap rates share of able we realizes the of to sorts How to that those in was of spread predictability just cetera? way and recycle capital positive mentioned et volume, in the sort of that pace, repurchase of that message assets the earlier? there that think that in it terms the of for activity quarter, market as opportunistic the to

Joseph Fisher

Yes.

opportunistic When the et the the to the NAV most NAV at was time changed last The the out I of parameters one appropriate. think, sources within to quarter discounts the look spoke. you use probably words there uses, only to we in one is we around is from really past that discount cetera. leveraging, and Rich, laid

a to down we And acquisitions. out additional actually didn't try what go We X.X%. Was development to got fairly pivoted substantial discount. simply to to from it. saw up additional shift our ramp at meaning, was dispositions of shares there fund and sources capital, we purchase we and So able didn't you

committed capacity month we're small. versus us. month certain definitely investments, on we'll we it But evaluate we return get look pick alternative to take have certain some if it we'll like a other overall, discount able what we the a little think size. But and aren't And communicate I come week, by that. a when to if by buybacks and We're risk additional level was to not going to So we to bit away. execute of out week even available like to dollar

Operator

line Our Dennis comes with Zelman. the from of next question McGill

Dennis McGill

First one percentage of on short-term that has the what any about And any that's why little on residents talked just success been frame And how, thoughts bit to lease today Can the the short do that short-term help and having. with characteristics maybe you're are of gaining you just that you a program are that leases basis? term? choosing then traction?

Jerry Davis

growth, to -- million year this million Sure. it, to impact to to significant line. even $X I going it's our contribute, $X.X would bottom or to income impact think significant other we tell you, though it's had fairly our a call

those same-stores. in portfolio MetLife throughout of being being So above portfolio, get the at given the number rarely some as XXX of leases time any the in some our

our of than We occupancy. put more get the no unit fairly so to total limit So exposed. overly at most a to percentage it's of count properties of X% we small don't try a X%

So look a split it's not huge a you there. risk in, business. coming at who's between XX-XX roughly when between And really

the need short-term And And for while. than that. on is a I have much in and relocations, between hospital, it's a a average of to come somewhere I need hotel. about stay in But and more to some personal corporate a personal basis, business. issue although affordable medical a or live XXs, I is more they to it's house. my the up little sort it's wanting I need be like near people sold of things XX-XX So to assignments days other for half then our XX plus, come in.

Dennis McGill

And on That's to would that new be Okay. helpful. only just clarify, leases.

You're on that not offering renewals?

Jerry Davis

been Yes. we've think really These date wanted But would we on look new. to, probably be would know has at -- would if -- if done everything it. we I I don't somebody to

Dennis McGill

Okay. Perfect. maybe but not in other just and thoughts what you're little And that Seattle portfolio, necessarily on some seems quicker be or can and seeing your you're transitioning markets seeing? separately, what market maybe then the of your a you on of perspective industry-wide to offer than curious

Jerry Davis

Yes.

new as quarter, X.X%. in I growth wholly we think area. we the first the assets revenue has know, no -- We're heavy currently. have in you of know owned supply I had downtown really Seattle,

one joint is combating have We that MetLife new supply. venture

a downtown. a it's So challenge bit of

supply. The as But up, properties University a of a the is is sitting year. X have majority the earlier today throughout last went Bellevue. new stated I downtown. a has of side, coming of supply new heavy Bellevue call, in segment through our on east on District over We a And with supply new portfolio lot bout the

new to had of quarter too. the come expect strong. X.X%. this at We It growth some first year right it now, later Bellevue But remains supply revenue in

So there types down campuses you tech it's it's lot of and there. like, REI had over it's out to create is a to Amazon over consolidated X there. campus. Washington, a form too. there. at firms Interestingly, large full. X%, companies or strong. other have of just when facilities jumped Bellevue, Salesforce building vacancy office across, their a X rates a over in and foothold they look of so rented We've Facebook has

very So then Bellevue is also product well. And very that numbers. continues to got strong B some put doing up we've

of at the think it you been has I a that's lot focused supply look at Seattle, coming downtown. when

affects on does Downtown most Amazon as a It of bit. concerned job supplemented little entire affect probably Seattle. it I like it's the less lot of a are bit because of being our it tell the heavier about the some us those than diverting HQX people over the weighting down east from A side. projections you, So go market. seems away jobs can

influx as Union Google. got the You've people from Bellevue Lake an of both into well South as Apple, area Facebook,

next So to area. this I the in But throughout it's downtown growth to a continues good. predominantly over X%. year. be going is job to in think, Wage is focused going growth early supply, be year, feel headwind But Seattle maybe

Operator

Scott. of Our next Stevenson the question comes from Janney line with Rob Montgomery

Robert Stevenson

on same-store optimism X.X% sort in gave revenue operationally give you're when growth seeing County guidance did expectations? on track first the D.C.? deterioration a bucket your more any is months they outperform Orange there? and quarter, expecting Anything given to you after D.C. on Orange few in ago. are months to revenue Jerry, you And X X.X% Or in were that same-store you of initial then County, it X.X% growth

Jerry Davis

start Orange we to. with X.X%, the higher County it full you pacing than kind I'll of year. good little bit Yes. Like Rob. said, first our County, had where would quarter. a Orange It's expect a

Huntington as in I see little put on to think Beach supply, well as going Irvine you're pressure area new us. a especially the

range. now, that I change. big think, that point, it's don't we'll at a there's beat still right this a way Ideally, back find to going comfortable So But a we're probably to down think bit. little come I

supply, new new prior is Ballpark, areas. There's X.X%. but growth, on where job In X,XXX growth was in putting heavy was supply had decent the us in from seeing coming You're homes we on it XQ, NoMa still revenue I of in us. it's D.C., XQ. at an Southwest as Waterfront, calls, some X.X%. pressure uptick stated It

well. is portfolio doing B Our

the feel hard. about than assets XXth Street hit basis are in to where around growth product especially the U currently points our a Bs. Bs seeing our We're As inside and continuing getting is XXX pretty pressures, -- U A spread lower between Our are As city rather up D.C. at Street

had last So compressed. that kind year, of

while X.X% believe it's in we at had of this Job into it in pressures, as doesn't come it's much growth the least Now that impact And come certain of negative feel new to really having range said of Nothing like is as there's we to concessionary the again within an expanded year. in submarkets district, up as starting last it heavy time. early downtown. the at end those we'll supplies But as year. X.X%, did some second do that again, still the in city. in half

Robert Stevenson

opportunity, the capital -- And both from And more in projects kitchen portfolio the the redevelopment today? of terms given in larger-scale rank and the then Okay. where today? does the from comments available refreshes redevelopment bath general your in about construction to allocation, and other small-scale -- versus what's you that perspective,

Joseph Fisher

Thanks, It's Joe. Robert.

which million. guided our to $XX pieces to One, revenue-enhancing $XX different You mentioned two traditional there. million we being program,

ability of points XXX but from the WACC. IRRs high-teens last year, basis a set to terms good seeing So in mid- slightly that cash, above to down what have are getting on opportunity still for get we cash our

densification, we those set in down XX% pretty XX that good XXX taking it, of fundamental seeing going of call continue standpoint, at the still a fine, a opportunity There's and So more about, XX%, opportunities say of rest the that's and being being put there. take redevelopment it, opportunities, number look about a I'd fact forward building with to off-line units the larger-scale are whether K&Bs projects. overall, markets. amenity-based it's off From we that feel our up. good profile given evaluated are most saying

up the a today on, it group's pipeline. So the there. priority working that put I ranks into that It's think but we

Jerry Davis

into that towards I be the as When But couple want to some would Rob, I those and And potential And they're not start handful we screen opportunities. we that would towards a D.C. a at in XX Boston, would a redevs probably the get markets don't to know, look located bench, Seattle, next any there's deep probably, it's determine there's I I as in screen process in at looking there but in would X if them. probably add, we summer that at we'll this in, are a properties couple look have super at to there's think point. year.

Operator

Markets. of line Our the comes BMO question next John with Kim from Capital

John Kim

and I land in of what then supply And past, Denver pressures. you building being with provide construction? this can just a think acquisition, just wondering color Denver in on you submarket market. timing talked market the about potential the you makes purchased you the On the I'm some comfortable land the where

Harry Alcock

Harry. is this John, Sure.

in it's across street. the the benefit Garden's in is from Elix a across plan, Stadium. the believe, It's near right First, and we redevelopment a densification significantly Denver above major justifying an area, around up It's highway. have area, Mile right which continued Broncos right will site High transit. is also

is it until of in that really And year, variables out. long X know, a Lake look for this early looking Sloan's wouldn't continue of one We're comfort a is of its at in We construction you half et 'XX years start which sites as the term. terms supply. late of or the development, relates we benefits to us gives lease-up, likely given, meaning, all X.X next as to general, like Continued really development, 'XX-type more or cetera. we just development and first

be disciplined. We to continue

pipeline ordinary funded. which of see million will and the year, our $XXX Most can just site the pipeline in our course. so, of you by is completed As is our existing that XX% pipeline or next at early be this backfill conserved

Jerry Davis

think extremely that in think a with do that told at that downtown of I really divergence the going he's would price the very add, X rents up about build where product Harry you point about walkable slight below the significantly to did to It's core to to retail to When location. the things John, to area our it from CityLine a what And light going at has or be I in, get site. X along similar kind the is I going up for. And able just in Seattle, in that, renting well. that Yes. do the to It's price you we rail. be travel are you nightlife. the is build opportunity -- to look property what

that pressures years. absorbed next but big years that's by the several keep for today out. easily mind, get coming now population and job that the should in the feeling you -- significant supply it's So come we're Harry right thing The said should several and growth

John Kim

related York opportunities then taxes, in other there markets? are was And other And had increase markets? that any to you the much New tax in to versus X% Okay. appeal estate of real how XXX-a in

Joseph Fisher

Joe. John, it's

touch So you then opportunity. appeal briefly maybe take I'll Jerry just XXX, through and the on can

So down you in XXX in on in X. actually do that related still down there you if supp, our X detail look see Attachment the provide to we can bottom, Footnote

see So or in real about estate could X.X% the you tax. basically increase XXX,XXX to quarter,

it's a expenses real and percentage tax. estate a If be to to you full look going NOI about expectations, overall. impact you a in which Obviously, our we is to $X.X about much really basis at increase when X.X% lower about think XX to million, again point impact year only XX total go

the do forward minimal, similar next fairly years. So we for kind impact expect several going a of but

Jerry Davis

We And estate I real everything. would taxes. just total add appeal on

be aren't our don't there would to it's in forecast, I a think there's a significant but win that out few we amount. hugely that expect I think going to

to knew taxes We going they be a Texas earlier of true. As working high looking guidance be stated to were real we gave hard tax real year, flat, we we in are on slightly. at if lot probably we're down up Florida, this Seattle, This New driving not check. to said, in growth, York, still quarter, digits. this going that's estate to offset expenses being with past that expenses, Joe controllable out single you're when were But addition the it too. as kept And estate believe going basically places in like valuations

it, taxes. values taxes a pay having properties to are got at so going your while higher that you the these other side the are of of look So the up, are

John Kim

Or XXX-a year? remind burn-off the this a us, issue And predominantly going issue to is that going be an forward? can onetime you is

Joseph Fisher

peaks for there. It's remain It to from No. then in next us. going XXXX, for much levels issue above out and an the not years several these dwindles

Operator

Santos line next Our of the from question Sandler O'Neill. comes Daniel with

Daniel Santos

just you wanted ability asset gains guys Just to from to your can fund sales quickly, on know to comment general shelter if buybacks?

Joseph Fisher

it's Daniel, Joe.

not anywhere be say if as $XXX our which our Today, payout fund capacity and in relative that gain have we capacity do from, to year. and asset, program, you about regards share a course to gain So of of the $XXX income in development say, sell dividend. able restrictions million dependent have efficiency sales normal are million Those on our to to million, exists, gain business, of to allocated taxable the the I'd more, to cetera. et program, our give terms typically meaning DCP system, given we can i.e., of embedded $XXX income the in

kind do advantageous less have a levers you may pull, onetime and you of go-forward you additional dividends sell assets, forward that certain meaning on go nature. those are that to and that But set of can and position. pulling up things nature that in a beyond basis really So

So we capacity, at future and dividend gain feel to pull but much point, to have lever a the we compelling that to pull the larger don't enough do that extent this we in have discount discount. the forward is start to

Operator

of Guinee with line next John comes Our from Stifel. question the

John Guinee

land loan it not I'm a $XX more the only looks like with effort to this, there worth Alameda did in a maturity. you than but year seems little a million It to new for that? maturity. Is it X-year almost a

Harry Alcock

sense the John, of the that, grow has begins equity-type this a completed and is would construction to us. Capital document, once the investment. we increase plan developer in to in expectation providing have Yes, normal And the a Alcock. into it sort fact, makes provide Developer that in we development Harry is economics that a ultimate Program/preferred that actually right

a into Our expectation investment. is much to this is roll going longer-term

John Guinee

Great.

to probably of question. of equates units least projects. me you And country. And whether or to sort not UDR this delivering are build chosen the me And most play in X,XXX cost. seems aggressive to that a X supply XXX,XXX project on X about Okay. a areas, or appears to It big-picture is except numbers yield that delivering these This at whose has it going not? that to we're then most annually public a it or projects look the in REITs come on is UDR at, depending game? Why that that that

Joseph Fisher

got to capital. I'll One, I little a bit take cost John. you of of with think Maybe just start it.

external discount today signal and You aggressive necessarily a at growth. strong give you doesn't a on go where which be at we're to NAV, look at to

other do you if have opportunities there. out uses, So at we look alternative

and then with we developer. opportunities us which over are years. XXX still and we DCP to find our we been spread remained can a disciplined are requirement pivot that starting gets And We that the any XXX, participating. point are basis deal, time, shown lastly, it, such in buybacks. pipeline type just has which through incredibly given purely around now as X-plus yield. We Denver up So just the we've couple some shrinking points shown of But not meets last at this the into

alternatives not to and we it's It's that not to. want it around going It's can that that a So that don't participate. discipline we go there's simply not we're to.

Operator

question Advisors. with next the comes Our from of Green Street Pawlowski John line

John Pawlowski

more market to or back conversation. years aggressively property cities values states values, strained from a Going assessed now? Outside you for from the any of that guys reaching seeing couple persist to could are are tax the fiscally catch-up property points typical perhaps taxes, for inflection which

Jerry Davis

only or I've seen one it seen Snohomish Seattle either This market with King but haven't occurring heard is Jerry. The County, the or that I in maybe anywhere else. is

Thomas Toomey

add, would values driven I think improve. operations to thing up, the go the fact continue to has mean, only primarily The and trends I research that asset by this your it pointed continue is out. I

looking going we but remarks, themselves, earlier values rational real improving they of continue start planning fund that at their And research improving. our to some to outcomes and wide operations cities a believe I if mean, that sense and I for challenging, makes reflective, think and How see it how to states are So when is there's on waiting range environment deficits to education tax fund be more future. are I'm from people estate topic. the are the

John Pawlowski

versus overuse the for usually competitiveness guys the study. becoming lending a next of more with? why you to preferred cheaper this asked, how you Harry, case space glimpses Exactly. tranche characterize developers year? trying I early work last the expensive Is That's the catch Chicago would of of or financing to

Harry Alcock

In There lending to to proceeds the loan sort think was XX%, meaning, not senior still be it's XX% ticked still fairly ago. years not two levels it to limited up. consistent. in environment XX% maybe same have of to is that equity changed, but some The typically Developers available, I remained cost. opportunities. continue has not circumstances, are

so over the of tranche in terms I So terms that both in opportunity of fairly pricing remained or and months levels. consistent XX think set past has

Thomas Toomey

I'd perms, proceed on combine construction ago, When years realizing loans people probably Toomey. is intriguing year XX, when is plus over basically are that interesting XXX this it. L more John, at me L me at What's at to you're have X ago, you XXX, and spread an I is to a construction our XX% The the XXX. a are there's coming borrowing that that X.XX points add plus a look opportunity to XX-year rolling XX%. way. couple at of now loan,

loans. off business to to see intrigued its Fannie is all know little done construction we refi-ed. in of And burden bit get a year. to Will behind activity that be this is I'm quicker what construction those gets how of do it book So this try of

So a of you're to probably to stabilize and trying lot those off get people see construction going loans. push,

we're the discussing, moving looking ourselves it where's opportunity topic and set So it's asking an to. at overall

Operator

question next with from Jim BTIG. line Our comes Sullivan the of

James Sullivan

these stay the until I expecting at at generally, off, kind they've numbers? be To number we that expense New XXX-a the know questions of of is do same-store was And should XXX-a, the of kind here growth same-store play about factor burns -- been a the New to in some were concessions York. year, growth X% one? QX. really to just with and earlier about what York comments I 'XX, last the earlier 'XX, tying look that at couple A market, expense XX.X% expense about market together on at here in And referred the of a that you've that extent you on the just or made follow that a commentary two, X% to basis, going number to the XXX-a. expect that in in at about When growth level take

Jerry Davis

This is Jerry.

of remain you think the had York there well elevated that rest until to period. burn load New talking do was levels off. I XXXs The our expense about when controlled. been Joe First, see should expense expect

I So contra at expense somewhat. until Concessions, in revenue not yes, the it accounts, least impacting they're think XXXX that to see they're all. moderates till you're going line so at

James Sullivan

Okay.

or And revenue and So next has monetizing 'XX several and a think been And back 'XX. far, would so to do that that given sensitive that that do much you're X% through And weakening line is X% period little if markets and than quarters, coming it over in look about how the top what your -- to value that growth in out you since foresee about within time, expect if guess, at same-store. not, of view of do coming you to, that in create thinking you as getting line, a of I number we the in you of delivered back time? 'XX, course, X% better that's the the the New the when some that line York? top supply extent amount kind in that, had to of

Jerry Davis

this level tough compared line with X Yes. really to us, elevated to related for We very a because It X to weak the were the one, start year our higher. revenue One-- quarter. utility were just reimbursements, was much primary year, I'll had are growth. a or an negative utility where things. kind X.X% comp item of which at expenses last

In addition, very last higher new right supply. a bit York But year. now, concessions is this yes, with year than were New competitive

typically properties, the do the predominantly portfolio. a would other Murray while are And renters started Financial of have we're there Hill. think LIC lease-ups in those One's I over seeing District. in city Long out or losing Brooklyn. Brooklyn, with assets Island opportunities are B and have our that us in in We to Two people that first-time new

again, where kind rent of, on ceiling be. growth really putting So it's could our a

revenue until have years, competition product, right X or now, these the think New some York X really So on XXXX. I while industry-leading inferior it X%? of we've exceptional in growth going had from for I that Manhattan new get see I price to the boroughs last because at pressure know, that don't they're don't back more up properties. putting our to When happening lower is earliest, probably point the

XXXX Wage think up. continue to York of I X%. is to in job has is be difficult, growth north growth and going New picked think I

just these that we So get you're on the being through demand I strength. XX,XXX-or-so think are seeing homes built. But apartment new have to some side,

far as Tom on monetizing, to Harry, jump as or it want that one? Now

Harry Alcock

Harry. of capital, ordinary decision long-term is sort capital individual in of consider gain allocation or redeploy of things. would at properties, that the market sources This overall We we uses, Sure. of the of opportunities where fundamentals that to processes type context capacity, look

opportunities. But context immediate any in have to York, the these we don't talk we other New of about. So plans consider

James Sullivan

of But growth it while, candidates it be averages like the in the high certainly sounds to of if portfolio the kind for to list trail NOI same-property is monetize? a going should

Jerry Davis

maybe. Yes,

years perspective. I decision think look next we're New to X think long-term at looking fundamentals X not to York, year -- out. looking long-term snap you've It's to happening don't over make and we got what's at the a of We're going the or I want for two. or be at

Harry Alcock

And just increases cap whatever a the rate out NOI theory, of if buyer off, out, flattens therefore, little years to year pile you in where underlying long-term or burns that tax each as look decreases abatement it, asset ordinary off, as again, sort bit, the sort would. growth in that burns sort about abatement NOI of the XX on the of think tax your because you on

be going to in were the we priced asset. So the the market, asset is be would the to if in fairly and of that theory, value sell reflected

Operator

comes from question Markets. Golladay Next RBC with Wes Capital

Wesley Golladay

bit the for a of Just just that nice. little early moment? the the skin a in yield a is development? to the the the going is game the just Is developer back in Alameda, quite Or of lot shorter there of at not function duration the process X% not

Harry Alcock

number between. participation as This these a function coupon But really it's with between between negotiation is are at way Harry. coupon the seen one to and current Developer couple this straight of XX% you've XX% we've priced sort And couple that the of with up participation with participation. a a a just of to no a allocation of X.X% of developer a a ways, in the others and different Program, in and Capital our all from again, anywhere

there's one. So nothing about this unusual

Warren Troupe

a to. purchase legacy is parcel appraised of just parcel. in this that new value terms in was was cash the into There giving game, land This skin not coming land a we're

of to up about cost on we're XX% this one. So

sufficient have behind us. we cushion So

Operator

in no are to call Chairman, like questions back comments. closing There I'd and to Toomey President, further Mr. the hand CEO, queue. for

Thomas Toomey

QX. focus continued time your execution, call UDR statement darned that a and headed from quarter. shape we're an first into want can for market. you tone clearly, in was of the and the started pretty opportunities improving see for We good today. lot all thank the And in with call, off second that this I of that and to with Well, it this we backdrop a you our we on a of of have reiterate interest strong that have a prospects

the you and be So looks a good start optimistic of at I'm NAREIT year to and rest future. take very care. to to is that, for team as us the management off see that a in as well XXXX good the excited With

Operator

teleconference. This concludes today's

at You may disconnect your for lines this time. participation. Thank you your

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