UDR - Earnings call 3 2023

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Operator

Greetings. Welcome to UDR's Third Quarter 2023 Earnings Call. [Operator Instructions] Please note that this conference is being recorded. It is now my pleasure to introduce your host, Vice President of Investor Relations, Trent Trujillo. Thank you, Mr. begin. may you Trujillo,

Trent Trujillo

quarterly conference UDR's financial to call. results Welcome

we disclosure distributed Investor measures yesterday press the section release in and to were with supplemental and supplement, In comparable ir.udr.com. the Our the afternoon most non-GAAP GAAP package posted Reg our G website reconciled directly have all of measure financial Relations accordance to requirements.

which Statements not historical, statements. this forward-looking call, are during made constitute may

give reflected expectations of reasonable in any assurance are will statements expectations on can factors risks are discussion believe forward-looking assumptions, detailed press based be we our in in the we included filings no risk A SEC. our that our Although met. and with release and

we be after the today. that for plus get we that ask We to of your will respectful session portion, be to available the during the update not do a When duty question-and-answer you undertake time follow-up. Q&A Management one to did questions answered call and everyone's a not limit get questions statements. any your forward-looking

turn will UDR's Tom CEO, and over call I Chairman Toomey. to the now

Tom Toomey

Q&A President President you, Ens Chief Fisher; who welcome also to UDR's are Presenting on of Van will results. Cantor Officer, Third call. portion Financial Thank the will of the Vice be Senior the Operations, call our Trent, Mike and Chris me discuss today XXXX Senior Conference Joe with available Andrew and Quarter and Call. and Lacy, during Officers,

price versus housing apartment third served from a resilient effective during and against To tailwinds and wage job quarter, as multifamily benefit point the alternative deliveries break much to consumer, begin, the affordability for quarter. elevated These an of relative industry options. the continued continued growth

FFOA relative this share environment. demand per of reflect growth and X% With year-over-year results supply X%. of Same-Store NOI growth quarterly versus Our stable

at our norms. Both rates growth of historical above these or were

from our changed far, demand B across quality stable towards However, the more supply unexpected fourth have the thus unprecedented into lease dynamic lease-up third in Since in as and our portfolio. slower communities its on quality mid-September, on years took supply leasing end pressure in and period rate the and my concessionary and was quarter This deliveries the hold. of communities multifamily new activity the put A dynamic seasonally throughout and quarter impact and the particular, industry. XX B growth and our occupancy increased

relatively Even as up well. more to so, has demand continued hold

year it us for While lower this guidance situation industry, being yesterday's per earnings release. our share our the across XXXX full to has led and with FFOA felt Same-Store

control cannot While business, our we growth macro name few. to rates, factors that and job such a impact interest as inflation

for innovate, on so focused and are in bottom we'll These can has do to added we come. our continue which years control. We include, XXXX, first, what we line to to the

two We provide building-wide retention largest our enhanced revenue, being expand will increase detail remarks. expect near-term Mike initiatives operating improve resident WiFi and over time. our and margin his to customer in greater experience further

bringing these more time. Second, margin operating X from the expect on third points acquired and By to XXX communities approximately we the the anticipate over communities we them during accretion quarter. to we cash capture platform UDR basis Texas driving efficiently,

poised scale-oriented our fee venture end efficiency expand and the should at redeployment joint of second with in operations. is executed the our Third, benefits partnership positive which to the quarter grow spreads, income to result

capital lessen. our actively to be fourth, supply liquidity future enhance our we actively opportunities where improves are eventually engaged growth enhanced strong advantage a of can and to provide cost and on that We deploy ROE. position partner pressures our should accretion with in earnings when to capital of And take

prospects. capital markets Mike a to and color pressure external Looking will growth comments well. organic Joe that will deliveries should apartment ahead expect and validated add as to XXXX, growth on continue limit and we these recession

on. Moving

build our leader annual score ESG our publication public our as These disclosure our the sector of with report, highest for work history, the fifth to being GRESB GRESB of should NA that sustainable fifth the more XX on consecutive UDR proud recognized achievements and of continue leader matched are ESG a be survey in by a position our year, We rating. towards named as all we stakeholders was future. a

$X to your multifaceted will whatever macro believe my us liquidity diversification, to work and help that for successfully we sheet Thank balance leading associates. UDR nearly UDR environment hard fellow face forward. operating continued you In I Lastly, platform dedication. closing, billion investment-grade with navigate of moving and

With that, call will over turn the Mike. to I

Michael Lacy

Thanks, Tom. topics. following Today, I'll cover the

met holding growth profitability far events. our fewer These include business. revenue our expense moderated to as benefited quarter results a indicators year-over-year growth retention third of real our Thus lease same-store of well full due have variety XXXX Texas an our fourth of X.X%, X.X%, growth tax how quarter quarterly same-store updated quarter favorable on renewal estate and respectively, above Similarly, XXXX, improved results and X.X% revenue in NOI primarily revenue into factor operating sequential growth expectations. Same-Store Same-Store in X%. insurance they outcomes year stable outlook across rate and and regions. To third and as XXXX early update same-store demand growth occupancy, begin, and and trends Our

volume concessionary by challenges of a environment as been seasonal that elevated seen some apartment seasonally the but mid-September, have typical beyond new growth period have to from since emerged, rate the including this, year. continues weaker Combining entered that norms. hold we well deliveries slower decelerating demand growing pressures traffic, of has However, and overtaken lease we all up lower one leasing

in midpoint. and and straight-line guidance by of rate occupancy ultimately the become points led the a NOI In seems revenue okay Buyers XX blended consumer full ranges which our reduce us same-store residents among can and many more growth right our has but basis have now, choose lease across shoppers, place the And industry. markets. each discounted at to sure, year prospective at pressured price in options

half more Nevertheless, we our group quarter elevated revised When guidance a of back the were with reported offering through the At we year-over-year delivery easier aware a provide in fourth time, XXXX. July, context. little we competing supply To above in second still approximately month the predominantly new the remains the elevated peer developers results product and forecast average. free not X quality and of consumer saw resilient our B with comps quarter.

to early September originally product. of things in still our was more quality This consumer directly This the with our to change. many health The lease-up pressure under of and began anticipated. we dynamic rapidly increased not something expect in and begin through concessions persisted okay, than markets for was our financial until did brands is place compete and occupancy

This EDR week from but increased weeks. typically to a X.X many half more of to result average concessions, not difference use threefold as we direct a competition, does approximately concessions have to are would roughly portfolio-wide realizing. equates back brands or X.X% achieve X% X% lower versus X% blends between in blends the we we the the thought July fourth quarter currently our

and throughout We expect the to into fourth XXXX. concession-heavy this quarter dynamic continue

our based revenue earn-in historical we and this Same-Store are approximately below a XXXX Looking slightly of norm. X%, outlook, ahead, forecasting revised on

of growth combined same-store one, potentially it initial approximate two, We likely driven And approximately forward utilities considerations to average expense due on will insurance, by is negative with XXXX will to deliveries growth conditions below X% provide but include: same-store the XXXX of relates long-term February, X guidance lower be impact to as demand. official elevated XXXX levels, market suggest revenue personnel. in pressure the rent that our and

the first $X.X In at the particular, we million in of quarter, comparison faced due year-over-year XXXX. credit employee the retention a onetime difficult beginning to realized

and implementing on solid years Moving growth initiatives we ahead. profile enhance a wide in per X WiFi to nearly underway: initiatives, month, installations, apartment of one, have we $XX will our which margin. we innovation achieving home XX% are expect continue revenue The per progress incremental at building largest make our underwritten the

We over rollout our spent across time. X XXXX. roughly XX,XXX will touch additional data nearly installed planned analyzing and leasing point. last We've project of help with every experience resident community-wide possible the to decade WiFi units across expect XXXX worth end turnover reduce a through to Two, customer years with interactions

From but this. this, XX% sell peer turnover of [indiscernible] of light average across dashboards and our metrics, large resident-specific is than real-time controllable. our acknowledge We various is there operational put believe and turnover experienced upon a we has to the built been higher opportunity

and still While our areas, retention identify of in On NOI. equates are its retention. higher of million dashboards basis approximately operationalizing improve resident early ultimately property-specific points the to own, $X.X XXX or changes every make improved to process, probe we

income other turnover lower coming should and the as be higher power. occupancy, years, efforts pricing the Over savings, effects of expense increased by tangible as well improved our evidenced

recent versus Turning in relative although has quarters outperformance continued, exists to supply Sunbelt of regional elevated The regions. trends. across [Coastal] all markets

New comprised we annualized new revenue than during high quarter. a levels points and East and continue was achieved X% of the nearly York year markets for Coast, lease XXX resident supply continued pricing NOI, which Weighted support our growth. X% quarter these to of X of nearly average In same-store power markets. our to XX.X%, blended of and On Minimal competitive third the growth strongest year-over-year be lower rate total demand nearly Boston, with turnover, ago. basis occupancy XX%

NOI is the occupancy markets second activity West Area to by mid- concessionary year-over-year XX% growth Coast, have of increasing third XX market the impacted. during however, our of Orange NOI, Other at the in San points Coast, across On increase which largest quarter. occupancy basis total greatest Francisco the Bay the showed seen West in high has an most XX% County, with and X% remained with strength the range.

concessions averaging across free to not weeks of San X While X find portfolio, weeks are is rent X we uncommon to in it the rent market. of Francisco currently our

X%, continues of traffic solid Sunbelt levels in elevated Lastly, supply, rate absorption of equating to concession lease on growth the and lease. remains on negative X% X-week year-over-year negative positive. resulted we volumes, an job face has new is growth new which approximate believe and to Based to new demand

of continue the available to across renters However, in ball constrain multitude region. we some to will new remain elevated wanting residents, which power expect options more, to supply XXXX, pricing have because should shop been the of deliveries

to drive utilize teams us, technology continuing tools In near-term operating challenges long-term new and thank closing, to while environment our results. superior presents the for for some I

over call now I will to Joe. turn the

Joseph Fisher

XXXX our quarter balance results Mike. a recent quarter The today I topics cover a markets you, third year of and and update. Thank sheet fourth capital and will include activity summary full guidance, a and transactions

and provided share The growth. recently NOI completed by was approximately and initial Our third venture previously incremental through quarter quarter as our driven the of from were FFO Year-to-date midpoint sequential the year-over-year communities. supported largely X% adjusted $X.XX of third was Same-Store with results in development strong achieved Same-Store, expectations. range guidance per our NOI by joint increase line

have pricing thus levels of resulted quarter the end robust expected elevated fourth previously supply the power than towards However, and less of quarter into the in third far.

per year FFOA a reduced As same-store we share have our and guidance XXXX ranges. result, growth full

dilution for sequential a FFOA driven per transaction G&A the ahead, growth, NOI the OP expense. near-term share additional quarter. Looking third at to unit developed FFOA $X.XXX per $X.XX during lower approximate quarter, increase completed $X.XX expectation the $X.XX we or midpoint. share our Offset year-over-year Same-Store from from is benefit by communities recently NOI from lease-up from of and range stable the guidance fourth The by X% FFOA an for

update. Next, markets a transactions and capital

quarter, coupon expected adjustments previously attractive impacted in X,XXX an debt assumed, share at Due for due assumption recent the of approximately the adversely our average in which operating the debt the in weighted $XXX partnership units noncash completed rate were roughly dilutive $XXX FFOA financed $XX.XX to per UDR below-market increases to and of negative Austin $XXX nearly Dallas issued at to of during related to to interest This disclosed X.X%. rates, and more share homes million was First, of debt million. we million of rate per previously mark-to-market is apartment transaction than acquisition XXXX.

drive are upside. margin confident points capturing future basis we ability forward, in of approximately XXX our However, moving accretion to by

total Second, million shares homes venture third, X% a implied average a X% at Funding joint we of to came were weighted low for portion we during the which yield, priced $XX rate. at proceeds a repurchased development quarter, low capturing an was of achieved the a the apartment received LaSalle $XXX located from share NAV California. XX% executed XXX XXX,XXX seed consensus quarter, totaling up total of during positive stabilization a approximately a average the community, thereby discount in from occupancy spread. million. a cap we on portfolio, And Dublin, and price These approximately at of common per consideration $XX.XX buybacks

property, to be XXXX recently to stabilization. other as in This XXXX are progress to expected along completed and towards FFOA X with accretive developments they continue

grade capable investment remains of liquid our and our funding sheet capital Finally, balance fully needs.

$XXX highlights we amounts and of of X.X% enterprise to XXXX, only have after million commercial first, credit Some mature program. paper consolidated facilities include: or our on value debt excluding through scheduled approximately our

peer to on proactive balance the has outlook rate sector manage our Our X.X%. sheet at in X-year and average group amongst resulted the the liquidity weighted approach in the multifamily lowest best interest

X.Xx, COVID we down just our pre debt remain a happy liquidity leverage XX% third, metrics of enterprise Net quarter XX. from better while nearly and have And turned Second, as levels. at end, billion year $X ago X.Xx was September value versus was of strong. Debt-to-EBITDAre to

these XXXX. remainder to expect through We stable remain of metrics the

our opportunistic it remain liquidity open in and and to excellent deployment remain capital competitive for balanced capital that, allocation continue accretion. drive up variety I Operator? in We will Q&A. forward we uses utilize balance advantages all, a of sources With sheet our with shape. and In to

Operator

Eric Instructions] with [Operator Citi. Wolfe is question first from Our

Eric Wolfe

at talked like supply. looks from pretty supply. the have that XQ not the deceleration about it heavy the broad-based, But of markets is that in look deceleration impact You of I if in just XQ, sort

certain get impact understand is going just pronounced broad to forward? in if consumer supply also So if or problem tenant there's trying or markets to more going more a maybe just the of

Joseph Fisher

Eric, Joe. it's

think it's of is XG the above percentage does in increasing helpful will X get a I regions. the averages because think long-term Sunbelt predominance reality is supply, of focus look to attachment supply at of I our as stock in of probably terms the all that

in Coast, X-plus we the Sunbelt while as Xs regions. clearly than do an it at is region. have by even other of pockets West kind East the each range, so you percentage throughout the X high in the low of in a But stock sense, those where markets And absolute supply higher up and have Xs, of

of half, And the ramp-up so what first degrading a seen regions. supply is all the and in blown half next probably into rates the growth X in they'll continue we've really year. of back those and it's

of than little Coast supply is the And the with change. so all just they're that similar others bit East the coming a It's pretty down West than little a rate better less Sunbelt. dealing than a bit at doing

consumer So dashboards we're When nature. our of I anything collection that up, terms negative anything supply do trends think the the side in it at seeing really is really a of of look story. that front, you trading look doubling down on not at the to equation,

in A concessions more B In in up of resident fact, we're some materially actually quality actually some paying because and the cases, fact pretty jumping and taking come that up the quality some seeing product markets. have

And seeing consumer on so side not yet. anything the

through pockets just trends these are good. of And really fighting It's demand's so still supply.

Eric Wolfe

I was someone good the it a asked this And helpful. That's question. last call, it. on but Got think

rent I'll sort the growth compounding supply to you it of I pretty is think impact to positive sort a going guess this I sort at takes lease reason supply and year. hit going mean up time see of sort to just of it. heavy we're that's a year? market properties Can of of look to So there amount of steal next

Joseph Fisher

Yes.

similar a call. and/or think good we answer good I question. have last it's Hopefully, a as

think an reasons 'XX perspective. think and I a industry definitely be from So as optimistic there's to from you UDR about

to the total from a supply of on of before next the supply off about know sets elevated reduction first deliveries at supply. are we ramping in of have still that housing and But terms overall. When the bit. do starts single-family you perspective, look coming is next all into and coming year dissipate kind half back it little of we then a year, the that tone in the in it total here think starts levels half expected I are

when that stretched last of since back look is repercussions to spend crisis. relative the can the of sales affordability also depths the haven't at you you going the when component, to GFC, look think existing clearly, home we back levels I at affordability a going see seen you to the the

in good think capturing least incremental formation, of at door positive a so back front. and position overall. demand any on And still terms really We rentership in the household closing remains that see to expect

third-party that growth, you positive. wage at the et look expectation you to job at look when year, If third-party cetera, forecast looks growth, going next

So it down year. that the and really comes this quarter third sticky just pretty as overall, remain in supply picture throughout renewals saw fact the the you to and

sending think range. still And most pretty the out are [indiscernible] I X-plus sticky. of renewals in us

So there's is bit positive say we be into and revenue. reasons less That as blended that do little clearly a average demand of lease when below more year a do to optimistic little a rate and going I in you trend whole. a bit have terms year, think next think could growth said, we supply next

What the innovation focused some better we're a components we work the tunnel be clearly as we on income into going half and of to to set become of get drive the which the as think do light of performance the starts end to next year. and we relative trying other is on bit for little up back and XXXX,

Tom Toomey

Toomey. is this Eric,

Just little answer elongate the a bit.

lessen how I towards will dynamics think currently marketplace out. the again, we're I markets some might experiencing with so see think of flow the capital we'll we see to start well plays that capital positive, but the that to in that and recession starting change as

Operator

next with America. Spector Bank is Jeff from of question Our

Jeffrey Spector

quality, significant. to given so this first years again, career, it's Just Eric want on unprecedented the opening sensitivity on listening to on the mean your the an in is B customers I Because right, responses since storage, is to to new just XX storage your impact Tom, But time see the summer. on The follow remarks, conclusion what's what's to supply. similar such self this happening? tie on given up, here seeing comment, into

going let's price it say, with like shopping. feel consumer just, is the something on So more than does

Tom Toomey

from Yes, driving customer in add and shopper much for Jeff, think available I would the have or Internet A the opening comment, on type And appreciate seen options the color In our ever. Bs concessionary what haven't what's I impact I essence, to them. this I question. it? pricing the marketplace here's transparency has more and the a

and a would So us I at number comfort concessionary and door in a "I and looking they're on their X just or the in and more." can the they new they're down saying, out months", walking the be get they're up more the out going "I Bs lot that product renewal a get slowing in a that would normal move-in so X we after economy. lay street down, trading month, concessions of saying, And new gives mean have not concern a some which of of

seems says and hadn't value they just call past a So phenomenon a some before. to on a enabled the just this lot The doing for lot what commented healthy. And color and more more they're very shop been in add consumer we what seen have Mike ASPs I we think than shopping that that Joe can on. it.

Michael Lacy

Tom. Thanks, Yes.

context give a me here. little Let

bit So obviously, a in markets more we're supply. where our NOI, of have our little Sunbelt experiencing and XX% we elevated we're

Bs on we we experience. new X.X%, points. on lease very quarter what XXX about to from and leases. our frankly, size were and to the underperformed basis expected second would were This have As just by during what As different negative our it, X.X% quite have experienced negative Bs is new growth Our And

the new second outperformed the Bs negative basis our XXX growth were points. Bs X.X%. that during our Again, size As quarter, by lease actually So on

to from was As performance again, have the what XXX points expected, were off negative just in X.X%. by Bs And basis new we would leases our summarize, SunBelt. A over on

Jeffrey Spector

might now pressure. believe follow-up we'll Great. when know to My should right just there by see helpful. if region. estimated And And it that's the 'XX? helps again, peak how -- into want peak we discuss I don't when know I supply about supply think to supply Very to Thank be 'XX, clarify probably you pressure. forecast difficult what's into but I you. is,

Joseph Fisher

months headline XXXX. the starts percent, probably in what I Jeff, the we is dropping a get of in last clearly of as guess with XX-plus be positive positive which picture seen very the of couple you've into wise dramatically down the someday fundamental here Yes, kind will

at we year. As look going a plateau in the others. hitting within There's that of some in going to the it XXXX, our of better a start That regionally, that of not a said, they're year. really first divergence that than different to markets we're clearly But like There's of regions. much all second in not looks be half. cliff look it's bit first little to half kind the the half

dissipation You're get start deliveries, have to months deal XX through a with you still see going to then or but to plus in to minus the lease-ups.

And going are so place XXXX. to into those lease-ups take

of concessions to going pricing off to that the these you of into have But see and move and end more extreme the at back start as through multifamily. rational XXXX of 'XX. roll levels a 'XX to So half the start tunnel, you when say probably light is bit to little panacea more some we're of you going the I be think not the for

be 'XX starts facing but look to clearly, us. 'XX, going with a bit to at dealing we're so better a And we're it while, little for for probably still

Operator

Our Nick next Yulico is question from Scotiabank. with

Nicholas Yulico

and guidance go assuming what those pricing to, occupancy Yes, -- back pressures some have assuming on original now understand of I I half the year and growth I revenue of in year, back of here, of year, face both to of and sort in and why that you on you're you're the half just of changed. the better that's the terms is guess, what you second back now typical was wouldn't the original issues the just it half guess guidance items? seasonality much as the wanted and

Joseph Fisher

Joe. it's Nick, Yes.

of days. time on to spent the here a XX bit last So good we've XX question. One, obviously in

to kind back guidance. we point go as the that we bit So a about as second of helpful talk confirmed in here half been little at to of we when well July had the year. and what last kind of it's what experiencing probably expected time in

we're through part of in in X% X-plus the And of first up terms yes, kind with the there so sitting of of rent experience, months year. sequential July growth

was pretty also both historical trends level, That but normal with terms in in of seasonality. absolute

seeing We are but seeing are levels pretty sticky pretty increased we concessionary still utilization. supply, of renewals. have occupancy, still sticky We normal

so the in a And pretty supplies had stable were there elevated we environment, it July. in we felt like even sitting

the went into that in a but back and about year, September so the comps picking given in we would on seasonality up, developers outperforming that to of of move half we when coming half comps into of we first going we believe of definitely terms expect did thought we And seen that we do minute which that kind the keep to a supply And that keep talked we continuation XQ. to that thought yes, year, days, was to and more the that continue of see previously, reversal thought material going a were performance concessionary wouldn't heavy markets. supplied ago. normal will help first rational activity. We're Mike Bs really our we've that as that half up We increase in we easier time the we a easier those act of in we definitely talked period

expected was that at hope the talked What we off kind upfront we which X.X% through together, blends coming or level of at X%, it around we're starting through rolled minus part about of we first kind of you plus XQ. continue here October when XQ. So

X.X% across all the kind $X.XX. our roughly commentary And is markets. on that so X/X with we end coming supply from of X.X% a up That's divergence revenue broader about

so X/X to is about just kind AB Sunbelt of and and phenomenon. And concessions West East, the increase of it

track occurred. And about the a good we got kind breaks change not of that happy record historically the it there. out Obviously, put We've we're guidance delivering it. of consistently up really on that so

that on of little optimistic this the we on call too probably bit ago XX here we months So a a put little were it's room XX, when bit together.

us don't is when want results. look on what mask third definitely at is ops track of they've the really of X Yes, I which doing I relative the Mike year-to-date. operations think kind team you what in team said, relative quarter, think at team sense. here and in least that revenue, be date goal and is, what you put the and a from That look and think, done the out results, we're should to it sequentially quarter, at I to rest the of of year-over-year, And proud our #X

We're both #X on think I X year-over-year on revenue or we're NOI. and FFO. #X

And relative overall, a so proud I think holds. the doing on of we're We're what piece still basis. relative

it peers, numbers in occupancy of occupancy of basis, blends why bit XXX And At that to. deceleration income, keeping holding the an get a is of does other look the that And on static. but peers, because I which same know better has had strategy time we're little slightly than driving we've revenue XX good. bps, seen we've our focus been the relatively a those bps, blends maybe mask lot absolute we're probably lower some than

you doing of to are want refocus So kind on of basis. a where everybody we at, today, on but where it summation also gives at a what we're we're relative

Nicholas Yulico

Okay. Yes. Thank you Joe.

other if assumption full it growth what then you -- then think I blended was said And you the new rate quarter, one year question X.X%. is, have is the full Just on last sure that was long-term for of to X%. growth XXXX, some growth referring blended wasn't the if rent average also I a that like commentary below earlier was number? be would rate there

Joseph Fisher

Yes.

go we're as as that full X.X% from with 'XX, year, on the that delta So the blends into we as bps $X.X down from million, kind roughly And year earn-in is of decent kind seeing really down to of into percent for relates that that to update year we're next XQ to so X% X-plus X%. of the comment kind do this seeing in head X% for it equates has XX to approximately that earn-in we 'XX.

off point. it jumping do average, income that, We we on obviously, little at as below demand at the typically this in be move time, slightly next point all bit else still is on a a those it is but good the forecast that the equal like supply little which, expect the do looks time to around. additive demand, number. But pretty So year same third-party expect can other long-term higher. to the a on margin But bit may weaker be

will if below minus the little or be long-term average, so plus typically probably blends And a X.X%. bit they're

X%. This year, putting up we're

the XX the see demand expect got it next days it market supply we relates growth. year, then and as guidance front an but to of on we've gives average us So out to revenue be to and don't kind what towards work the above year come that, with

Operator

Our Austin next Capital Markets. with is KeyBanc Wurschmidt question from

Austin Wurschmidt

you expect that market any side, lease the to rate in of regions negative next average maybe negative importantly, then markets growth? flip guys long-term year, growth or have rent any exceed markets more Do think X% you your blended could And on XXXX? of

Joseph Fisher

it's Austin, Joe.

level this we time. it I portfolio think early too through the then to when going at process. also a point a ground-up come in and We're look at it's at level budgeting

early next guys our another to be there's budgeting in XX, X, ultimately probably thinking. and we're out so and process, days XX into either year January, get then to you talk win outliers get come late going side through what to And to about February

Austin Wurschmidt

I'm in And shape just in in risk the of And additional curious how fair. ahead. kind skips guess then backfilling up you I are along of how quarters the the kind the far you VIX? That's

issues peers that seeing. Some started recently have of some they're your similar discussing

Joseph Fisher

elevated on cost job I the some good team really a level also the which of to half. the down. But half pricing, done get turn fees with and legal and occupancy course, put throughout first we the screening the of think working delinquents, a processes legal and first of but has the number year in costs through both year about regulatory long-term pressure the that lot in the that some the upfront talked appropriate and here of

those place, which slightly means Xx amount have do number delinquent the average. of processes we you fiction exposure above XX% the have that maybe X, with you still long-term long-term And in so for dollar that up in still challenge the end elongated individuals. elevated The portfolio, a is of

at that year. we'll so bit little And better a probably next level, maybe the get stay over

collections I'd time. though, month. us to be that, kind we XX.X% mid-XXs have of additional each the continue month to we usually say that about collections in Subsequent to collected strong, over take collected Encouragingly, get

And so debt of that X.X% kind stable stable of year-end. gives bad in last That's you couple expect over here quarters. to remain a the it We'd been number. the pretty

averages could there's little of we I into year, of given XX.X% upside. don't but XX.X% be a environment. to that getting long-term think kind of go little back think regulatory I as level. we're next the maybe upside of collected, type bit there a bit from

a really total in rounding of the becomes error said, That picture. it kind

trees of think force the I So bit of through dive of little we're kind it. when the losing we a kind into

Austin Wurschmidt

negatively impacted where Got markets coastal compare XXXX, it. how versus concessions in X one one, it Could compare And of period periods? was just level then just the were I those supplies. XXXX curious sneaking portfolio-wide quick you I'm that, think

Michael Lacy

Austin, a you back tell prepared X.X I compares to I my XXXX, of look and what few actually probably in remarks, week to Denver, numbers those think is and a interesting XXXX. ago. That we'd have would weeks X more to been San at a a bit seeing Francisco, just X from But today. little what we is what's around go And like the than weeks. average mentioned some places L.A. seen months we've half increase

weeks about have you moved the assets else XXXX, weeks slightly well Sunbelt go elevated frame consistent. maybe back say over I would then X today. to But as as pretty everything levels, 'XX with And time our to Philadelphia being that as X.X

Operator

is with from Feldman Jamie Wells Fargo. question next Our

James Feldman

part wondering line income I think your as in back be grow. know it's to you're the continues of other those they'll of just you We're versus plan. growth downturn your on how and rent about rental a the income pulling So quality resilient earnings expectations.

Michael Lacy

parking fees and They're in smart that. has whether like applied, different that to we've this Jamie, lockers, things Mike. is of homes, do sticky package things pretty like this A it's nature. with lot

sticky. pretty to tend things So be

addition that, in nature. to incremental In it's

still that going rolling short-term starting like be achieve there. pretty income of The We're $XX we looking good. our amenity the with those to to to basis out that's that We're is growth. was again, And it, points things Internet premiums thing furnished, still continue And newest pretty earnings our other program. for alone on XX So things next have increases. year call rentals. drive, doing significant to just

feels everything overall, So pretty good today.

James Feldman

Okay. appetite in And you change mean then fund conditions market of mean, new program, some for do much any think has coming this the impact you I the mean, this I to mean of think capital development can those does put is I guess what of to to gears in in and capital shifting your even developer other you year? for big could some picture kind I how levers -- you work what the starts? investment.

Joseph Fisher

is This balance good feel it. take I the number guess, about sheet liquidity I'll really one, Joe. and we position.

period strength, of So you of going time into with clearly, this if position will.

a optionality. got good So we've

start year, dry As low the that are that effectively. Today, portfolio of to capital Xs did and so is transaction limited in to market. in kind a our list, joint in out mid- powder pick I'd the seed we that range source you down volume that would high the with of Xs say off reserved earlier go we kind for we rates cap based there some this that venture

out So and at partner. importantly, effective to our transactions. we'd source of of But can there yield and where as able we that, level. we top XX-plus in to kind on additional to and that percent get be plus think that make on go transact recurring upside the prop We like platform that fee with showing transact the pretty relative compelling We're stream the them we on NOI capital. can layer to asset management both just

we to the so it drive way focused right of And now that partner very market right our on advantage accretion now. is and are take and forward the the

not the taking be I'd starts thing good seeing side, you to place. opportunities, we're many development is that the any going on really is that tells say which DCP

we while so on to at At JV way. opportunities over And time, come potentially do in time, to the for capacity think this be interested over our and waiting and that would looking market adding portfolio utilized being us the comes point more we there. our in to

new coming lastly, now. right terms pretty FFO and will you doing then But mentioned got additional challenging and cap least clearly is, some And where of 'XX. want this of development. through at capital accretion thresholds, in lease-up is our drive see most where point. there we'd mid-Xs and just on a assets well not some of we're current here cost start rates current that Development are basis, We've in given are cost at likely debt, to 'XX

We're come from over But benefit I cost would down. if see the say we're side. costs starting not level out, time getting to some potentially

building go, patient come there got And and go when just so to that us up there's point market keep when point I making all go we the think aggressively that in we're ready our we a and sure going if all signals time optionality land pretty way. to to

Operator

next question Goldsmith UBS. Our from with Michael is

Michael Goldsmith

backing any given is walking was if there's was their lot change and about well. a a But approaching talked has the that? and the Are of options they trends then demand been As lease that in out? talked curious that there within the the cancellation out Bs. a Just You I wondering processes regretting and bit pretty in signing quite how decision in there, there consumer about we've the holding of

Michael Lacy

very point, we obviously bit more. are And people seeing have watching great question, a that's closely. we a something Michael, shop to your little been

that So run running This of denial about the in we that XX%, canceled when rate, time XX%. around typically year, XX%. we're think you currently

door. are better we that a there's option there. So They're people out seeing finding through the come potentially

front So door. more times, elevated a canceling bit little they are that at their lease is so on the

I has on, call We XX% the degree. our up some to typically tell to picked you what back is leases. would negotiate XX% door, And then on it, negotiating of

We around and sent points to what about that's are around XX%. XX% XX% that of equates currently we to XX basis negotiations, to normally, XX% out. off And

elevated door So but high the occupancy bit, XX%. and in both still has backdoor front a will drive that little

pretty feel we we're where at. good about So

Michael Goldsmith

lease Just to correct? that's related to clarify the renewals, factor

Michael Lacy

we flashlight And on X I'll as our on our months, turnover we've you, tell just down a focused the Correct. last putting of very seen been over And that. have late. go renewals by

around up. even and that on try little again, still going So are sending We're more achieving are our bit negotiating though we're drive X% above year, still we more, to continue much out we it's rest retention a of renewals. not to X% to our and this

Michael Goldsmith

utility gap Bs, down issue follow-up Or an come gap interest and where to pricing an supply. issue that price sort where come there's is as and to Bs down And price Bs this As of going supply is my and in have more the price, and between this absolute question, concessions? the that is relative there's at in the the as these relative in at new have And new like a price that As to then that just just -- of more that as more As certain relevant. between Got it. at back the the get like less

around any Just that? thoughts

Joseph Fisher

Yes.

piece. the more relative I of think it's

and will you to deliveries, XX% months But So throw when and concessions delta and between you portfolio at new usually a quality XX% there price XX%, the call is, B it, delta if delta roughly B you're new XX% effectively or on brand look that traditional at you with our up a looking between X product. end point. that

on XX% our $XXX type a about talking So of month. you're rent,

month. you're I And the okay, so $XXX afford seeing say, positively, a consumer incremental can

So strength, cash kind with it position speaks to of the and them. all where of

they're bit or little quality a So better getting cash. a asset more

to off to is delta and where you will when that's to product. get A the I and that recreate those interesting extent now start that XX think be wider months from we burn B concessions begin what

be further the to bit ability for B the that that consumer. is into space. watch consumer down road upgrade will that interesting down come they from little to back seeing we're to for XX If and dynamic now a that's happens now. It what months quality But that XX

Operator

ISI. next Our Sakwa is Steve with from question Evercore

Steve Sakwa

Joe, question, of on capital one Just kind allocation.

appetite is You today the probably think, JVs and sell they're I'm cap. stock's if these asset assets at proceeds levels? appreciably at those normally buy what more back talked about some rates to stock share even to and use the X the outright of than and sales what cap into just around curious is maybe stock you'd obviously, than trading either higher $XX, or a around I buybacks, that at lower dispose

Joseph Fisher

identified we did at capital we kind locked lower buyback that of of do had source the when level. Yes, in

MO it's in so have that the it generally we if do been and scale our And source. is smaller identified past to

take the will to at look think additional see price several now, a next over I assets they to quarters. we market exposing where right the

it Just DCP and of to be optionality continue or to with buybacks. more ourselves shore potentially up into at course, look JV, opportunities, redeploying present the liquidity, some some

of mid- opportunities But we're seem that I may a definitely priority find of instead high on spread equation. to to Xs, Xs, like JV right is -- mid- the now, acquisition the trying side the to a market. in buyback think wider if versus the And trading high while the

recurring platform, you I that get on stream will, bringing plus onto enterprise. from think adding the from the and can enterprise we average when you capture shrinking upside that to that our if and below scale operator, versus a scale fee throwing it then

call stabilized final FFO yield or isn't X options. the it, NOI delta yield The wide that of, in the between really terms

JV we'd environment. prefer to our partner deploy in this with So

Steve Sakwa

quick Okay. And on development. the just then one follow-up

the but we're think targeted know be certainly you'd high would kind the the in I issuing rates to right yield. probably Spreads to may tell Xs mentioned you come Xs. why that is X.X% down, was if yields in sitting bond close of Cap the I X%. guess be level mid-Xs. I might

development So to sense. makes why would a X.X% yield percent

Joseph Fisher

definitely on Yes. that That's are on number question. we one, a say, front. fair I'd pause

at the the into the is a rest wouldn't first next start at So were what to what Maybe we much probably the we'll higher stabilize looking rents not if able the harder capital time on we're cost. because if I'd X.X% even current we usually dynamics to to least be look a now at X.X%, this of through that that then right by of at and is later relative definitely stabilized get that time. able source should yield we required that the have than year. say the change, of here, part and year, current out take anything I year expect

time market lease compare X.X% to X.X% That that that X% over today. would cap a of X% up. in the so kind becomes to as And rate X% that we

get a XXX asset it, capital call cap point brand-new stabilized you basis so the market spread to at, of rates. or source And

point And wait point and think in at so why have want environment we those to we not we're get that's yet it think where I available and at starts that that if we're we see time. a makes And we kind of to levels. time stay sense where still macro in in capital-light.

Operator

Kim Our next Capital John from question BMO Markets. with is

John Kim

nature? been markets supply can remind other lot your in on typically of performance? of Or have some there you rates. a older lease mentioned a you down assets of have that's are one they kind markets, dragging like that when but us, Other is And particular broad-based, Joe, drag know, look just the seem that these growth this, is pressures. at this doesn't market markets compose it supply I you

Michael Lacy

like in a and talking it's over category, other Michael. over in we've They This places John, little X around about bit that and period our of concessions Denver that's I weeks seen experienced the what to months. last few goes fall X market what was and Philadelphia. pop to we've concessions back time. where

quality markets those to are supply, lot in So supply. that partially of with a properties computing a due those typically

John Kim

identified and move mentioned the times same around. improving you've improve market? controllable. retention turnover Okay. of have time, prepared on And more question that XX% information I mentioned you is many Mike, confidence remarks, how and this shop in retention to been my in that it's focus meaningfully is that do people much At price can make guess your on you this call you could that the

Michael Lacy

great part just us job of And last X remarks, peers. Quite our the it, When a in versus done bit we over of prepared the you years. haven't us mentioned a with confidence. compare had I

going that back are I And in prepared but example, to for above that's think we mentioned and my X% remarks, so average. think, change every to the to And a bit what's average. just dashboards place the it from able interaction putting trajectories. in exactly And today, get we to we're through to there's things these us to having see coming score those interactions door happening being little just drive

associates surface. the as to just centralized the our rate it's field well of now X mentioned, starting And that with turnover as out, down, We're teams. scratching play our we're in arming months as I coming

and we're 'XX into for that of as a mine so and us. heavily we've I 'XX, into able been produce think And this to we going to lean it's utilizing data lot going the to results go

Joseph Fisher

desire actually John, in if think a little to where on The that or the do concessions to that we add and comment in last you is went their only overwhelm one look I turnover, rent stay years XX with to bit back factors or your on Want of there's opportunities, because environment embedded performance that reality go. of had better will. just an when controllable XX the to is at top rents.

has And their with what's in. and move-in then so do it their to experience a experience more to move lot subsequent

service issues, the issues, noise to and do of how level we things And/or the door. next do waste at individual property certain and or you they're calls how having maintenance So level, noise both pet appliance circumstances at or some dealing crash the perhaps when like an parking with remedy that it's related maybe remedy those. you're

meeting in responsive we needs. their are Just

can individual And end the care experience of, we the of therefore, hopefully do level a factors. stickier at better resident so take there's to them nothing a and rent lot Have think and give property a that controllable of to we with day.

Operator

is from Haendel Our St. next question

Juste with Mizuho.

Haendel St. Juste

on add up. debt on list was could left bad was the one you here. reserve my light some Joe, Just hoping maybe why

up $X.X guys year full quarter. guide in you about here, And but differently, perspective. from debt million think are us versus you a bit embedded I what's can last maybe remind contorta your I bad know XX% 'XX

Joseph Fisher

Yes.

an attach down just X one, other net where that in reserve. everybody X looking disclosed number inputs. them on the for at we And our reference, he's footnote for And say, so call, is of number just output AR X, I'd

gross think a do have put of predicting basically you reserve receivable what then which our accounts have is we you so against that that, is that and we amount. gross uncollectible And

receivable And $X million. so by quarter. And in the actually is came about that's accounts two things. down gross it net million, up of was really those $XXX,XXX two the $X driven by roughly about That

And good thing so that a of number coming collections. in down, terms clearly,

piece brought collectibility looked we We're other down to we is that saying The time think of month collections over the and actually we our getting that and collections as XX.X%. in at at accounts gross improved. looking reserve that receivable

a So loan. of mortgage kind we're of getting delinquency It's delinquent they're instead similar to having what of us banks to a delinquencies. each different of and payment assessing see it and then actually writing a the no zero, those when off that you collectibility one with really on

little a binary bit necessarily not science it's little and So bit art. of a utilizing of

couple over here bit, a it would down So the the be on trends think we be ticked stable continue trending next quarters. in to good that we to see collections. It up little of but probably

Haendel St. Juste

then the Appreciate that. And broadly, within near-term debt bad for motivation. the expectations, guidance growth

Joseph Fisher

yes. Yes,

bit that the little in success as half here a in half. half full that this in we year year. of -- bit than delinquents we getting that we'll we were think lighter the we're or the the the in point, of have Little kind first out. minus probably of So had the better We long-term collected those year second at of out plus level back XX.X%

some as And to door. from additional on try going front mentioned in putting there's through individuals go in some think that depend earlier, maybe XX.X%, upside back here so of into place XXXX, year plus fraudulent to year, that screening mechanisms really coming full I for environment, I keep we to to a that's the the the this half regulatory we're

again, there's could maybe bit be table you year of XX.X%.And think I over big upside. for get XX little we there on number the a XX% over don't But So bps couple period. a it's a of time, to

year, key so the a is positive. not be next And for it's but our performance slight it hopefully, going driver to

Operator

Adam with Stanley. from is Kramer Our Morgan next question

Adam Kramer

them of ask, in bit some these kind the just seeing concessions of it's as they're you're of their of know, move competitive it, of guys wanted with on targets which I characterized they concessions. And you little developers, longer kind the to to that they're the maybe I just offering. where different question. kind right, able kind markets -- just extent some for if of think they you some new no rational the kind offering kind lease-up. Maybe maybe then of of side of the are of of get a kind other to a side. terms in the distressed opportunity of not from to environment ways the extent from kind pressures, of And high-level capital describe I you could have Maybe on challenges? to don't Are starting of supply of there inbounds hit there's kind right, to just behavior more the

Tom Toomey

irrational. being Adam, people Toomey. are if my hard this It's judge But is always says to rational this. experience

Then need free." there. time and need and/or extension." mostly to "We of negotiating they'll about they months because for to to months an and loan their I forma I Capitulation it free. immediately their an X X periods say, to to start debt pro go to saying, to rational coverage paydown and are a when trying they being they're "I going ratio at try get And are developers looking slow need during lender stretch a calling think maturing is the X extension. they're month service

So.

X month or to there'll is us going months a You're better possible. I as in and free, not raise. a likely. can't for rent, and at long sitting at to what refi though to I'm $X,XXX -- that the that's hold get on looking pay street irrational. goal right surprise to has the by fee a afford the I'm for to be even hope down caught think ultimate paying is stretch the sure What have to don't the connect it as X,XXX And most X I day A that customer that any I saying is asset and and the apartment,

frankly, them those And getting are lot a of raises.

to markets. to us So time. is rational lot not that expect all me a putting this A to will, jumping side rates, that's time a sure consumer I'm higher very I seem -- wouldn't in you themselves card doesn't stuff higher jump of and the underwater, that if of forecasting surprise is, to way balances. truth in further and the these the But on I at credit B the from that the hate

But that really be X-month not out The any free reverse. very market surprise. that evidence the see don't there. some of We're we seem flag They so think do, that's No it We're we developers, I seeing may hanging speaking. So not when very, surprised. yet. And desperate times. a with will interesting not much, yet.

Operator

next Street. is John Green Our with from question Pawlowski

John Pawlowski

developer question one program. the capital on just Joe,

right give Just property us values quickly land sense what values quickly ratio given is the average and a loan-to-value moving. you book how how think you for the now? are your Can true deal existing in

Joseph Fisher

definitely situation. a It's Yes. blend in fluid

since borrowing our basis or rates, points XXX mentioned, were costs just I -- not call. cap by you last cap mean up As

I'd fluid. you XX-plus pretty today, creation when these if NOI is it exceeding they them, their think about did where have built-in So of they had of And to relative they're started say forma deals cost. to value many numbers. majority percent expectations at pro of

So pockets there I'd there's majority and large, the have exceeding of but been been these expectations. their some say greater actually where are challenges supply, of by deals

years or don't figure have in up into you first And point pref got we on comes if equity lines some XXB, get that showing maturity. out specifically out know to due. the stack when on that those to overall. deals to that X look questions individual equity just say to so time We Attachment would how the I I potentially

down not is That's Just always want years co-terminus our to footnote or position. the to pref that senior X, with actually remind maturity loan. for everybody that

first those like mid-XX bit actually So which are little X type to a deals, look mid-XXXX, coming sooner. they're to Those do maturities.

due are The not coming coming deal that's section, due. the in January XX. next down up is those Fairmount, XXXX loan for actually in So us

in what one only that refi about and through working and like. does to we going look the the that to that does think capital that's trying 'XX how have be look so due And we're stack

of think I their rates stabilize to and So initial ultimately. most that these to I more transaction. quarter, by next But on are values some trying cap out think exceeding have just figure we'll overall, talk about pro where It's forma.

John Pawlowski

give you concerned Can going follow-up. flow the down. rents other sense One of like ratios, debt projects cash coverage storm a on the cost It about Okay. drying how you're going the are us interest for market many attachment XX(B), the on up, up. developer service debt perfect types feels

us give a So many of you're can worried you sense projects how about?

Joseph Fisher

of of I'd are in they're deals their yield. of in most XX% say the -- of NOI that I don't have of that the expectations. because to pro guess kind want fact to get transactions. formas the These I specific into kind bottom been X/X these X% exceeding page, Yes. that

good. of that's cap feels yield to pref kind mid- to Xs environment a to X% So X% our position, high which pretty a

liquidity got reality with SOFR coverage the from has still materially. is, I plus painful yes, alive perspective. The becomes that and to much And to XXX, we've be increased a when well SOFR you're available. what that have is able are GSEs and these very get to think

balance then and coverage. to so and liquidity you And rate the got the

they you're window to go cash many get to refi longer of debt. refi. they want when get to lock once to They're duration on and trying nice if coverage to manage can debt, flow so want in just they do do that these And GSE you doing deals

go where say with partners I'd given have So senior of at assets of discussions we that the equity impairments continue the senior they if loans, of or these partners this figure terms to nothing to to have over in duration but working of the and those any need we'll go time takebacks out point, speak to on somewhere.

Operator

Mitchell from is Our Paper next with Connor question Sandler.

Connor Mitchell

and little I a talked that about your guys then guidance And at does now? development how bit looking impact just the my regarding the you landscapes reduction, So of underwriting guess how you're your is own also JV. different question

made deal? in how you maybe now what ahead, see about underwriting? JV expect the the few So when you LaSalle months a looking environment can to think can versus difference we a And the ago

Joseph Fisher

I'd pleased guess debt that we Obviously, we're it's different time. done. I got joint in say, Yes. at first point that little off, very venture that market bit a

non-dilutive we we then that cash with the being a So those as fluctuating a we proceeds manner until was redeploy. did, pull got for into stockpile being there liquidity, CP you the pricing that in if basically them able time that pleased trade nice and paydown transaction deploy to out clearly and very will,

I the of find think to meet rates right are if the where from going cap we're opportunities. an market underwriting standpoint, terms we in

Xs that of kind seeing to mid- high caps. you're today, So

on a volume. transaction You are limited seeing that very

And of in a the do number in there's market you have of out that are sellers a buyers not lot market. that there to help So of pricing. kind the

you've capital a have of funds they've available number that So raised. already closed-end got that

You of then, the course, have worth offices, family of type there. money, out net XXXX high buyers

that and of where activity, limited And actually that of so the there's seller borrowing with market pool transaction are beneath those amount right done. now, get pricings while buyer enough are a current costs to

change be find maximize the an can of think what can we us I going partner to together from growth of terms period expectations to we're platform forward, not our and do focused on going really in what going operating underwriting forward an is perspective. time. extended necessarily that can over

always that's focused we're on. so what And

So I underwriting go-forward in in growth change perspective. of NOI terms there's a don't think much on

Connor Mitchell

little the versus earlier color. appreciate A of you then how year. products the talked a bit products feed that about I And opposite was underperformance and this the

Just about some how going think on kind of of get the wanted you in thoughts mix to portfolio your of forward? your D&A updated

Joseph Fisher

Yes.

diversified course, from volatility good I pretty uses. has kind sources cash foundation price clearly ourselves the submarkets pivot and plus of provides we're markets or the diversified time, also you and, having think us minus at insulate but flow, and diversification that served points, to of a the well to XX in relative look over when which

worked potential obviously, it nice. during portfolio, B biased, throughout bit downturns we over when little but also to B markets the has insulate balanced. a redevelop We're well, well us have going you are more So can is and the want solid rent for pretty of that see time. a I kind a remain upside you think which helps

do taking the to more don't to Bs on material more portfolio as see when place the margin upside to try bone typically for platform. meat on we get operating allowed more to to because to I bring So strategy. like We the any buy those and/or find shifts overall opportunity a little

do great you that see typically And us arm does the for developments then B job buy a range portfolio of typically. bringing A through that our really in quality So comes improvement on of kind to us. development high-quality

Operator

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

Tom Toomey

that it and of it's for off . And to level to matters all reported, operations, and bottom team potential. highlight the for their testament to relative differentiation my in and closing think particular, take support growth the again and of starts the and of and performance finishing hat and what X I are have future points thanks your get time and interest expense I of a Well, to efforts revenue, In quarter, it Mike NOI, of line. you want remarks. platform, out key my UDR. #X that we with I peers which the in performance during the

and many we couple take in seeing And you at Los holiday/ that, of in other NAREIT weeks to at events. forward of Angeles a With look and your enjoy Halloween care. upcoming

Operator

you. conclude conference. today's Thank will This

You time, may at and lines for your thank participation. your disconnect this you

UDR (UDR) 27 Oct 232023 Q3 Earnings call transcript