Camden Property Trust (CPT) 26 Oct 182018 Q3 Earnings call transcript

Company Profile

Participants

Kim Callahan	SVP, IR
Ric Campo	Chairman & CEO
Keith Oden	President
Alex Jessett	CFO
Nick Joseph	Citi
Shirley Wu	Bank of America
John Kim	BMO Capital
Austin Wurschmidt	KeyBanc Capital
Rich Hightower	Evercore ISI
Alexander Goldfarb	Sandler O'Neill
Rob Stevenson	Janney
Trent Trujillo	Scotiabank
Karin Ford	MUFG
Rich Anderson	Mizuho
John Pawlowski	Green Street Advisors
Hardik Goel	Zelman & Company
Daniel Bernstein	Capital One

Call transcript

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Operator

Good morning, and welcome to the Camden Third Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions]. is call this note being recorded. Please I to Kim now, would of like over conference the turn Callahan, Relations. to Investor And Senior President Vice ahead, go ma'am. Please

Kim Callahan

Good third joining call. morning you earnings XXXX conference Camden's and thank quarter for

update results involve we could are everyone Further we information today's our differ of on not future advise because to them. and our guarantees Before like you about expectations current cause and no statements and these be making or that events. on our found subsequent to of the review represent call I will prepared risks we supplement expectations. filings would risks begin in from beliefs. that to can and these forward-looking current Any be to made actual assumes opinion and SEC, based statements with uncertainties remarks, These statements management's forward-looking materially the company encourage performance statements obligation

in release Camden's As includes complete reminder, call. available which and non-GAAP camdenliving.com website reconciliations a Section will XXXX to it on financial third earnings of discussed this at measures our is the be quarter Investor

and Joining Chief Executive President; Chairman me Camden's Chief Alex and Jessett, are Financial Oden, Keith today Officer; Ric Officer. Campo,

call you after complete our the additional remarks in call if brief ask over be everyone the today, questions to with will items are We within be and the try time, in phone to queue by to If Campo. one this Ric I'll concludes. you unable your the speak to email have we prepared rejoin questions additional respond to queue we'd At then turn or happy the to limit call discuss. that We hour. to two

Ric Campo

theme providing shot ended. for Name quarter. I'd by with songs were quarter's John's like our this year honor for winning Capital song and at honorable That XXXX for to Markets the Kim a last John's Music start Thanks, Recession John theme from Kim the Great the the music. of call John got BMO give -- good to morning. contest the

songs have -- than you are speaking bet and sounded ancient, sounded you to fun, the today to John XXXX. still a be I'd more third more qualify impacted willing fun are of are the having Time how have Camden's but there call by others few of school when the recession. recent, this Some there on may didn't probably would on few personally say fun. you're quarter in you're who as results depends they flies in may of

growth to growth better despite with and apartment we high teams Apartment and markets. performed support strong most rate control initiative. levels remained high run expected onsite our solid had expense than driven migration from teams our markets. states fundamentals cost Strong Our support and revenue and in regulatory by of Camden's great our of has supply continued job in demand high high attacked

the year, $XXX million The combined changed guidance. For line which our starts, has mix original development in of is acquisitions and we however. with completed have

our than more turn on $XXX to are those Oden. developments less yielding producing call yields. for that yielding were traded acquisitions than million timing higher our our the and $XXX We With be guidance. starts I'd acquisitions Keith development over guidance million like those, on will effectively to said, different Our lower albeit the

Keith Oden

Camden's quarter was Last Ric. earnings XXXth quarterly Thanks, call.

like growth were X.X% Same-store XXX. expected quarter results revenue for as next X.X% Honestly, this gladly XX solid our quarter, than So year-to-date. I this quarter just both and one was slightly up we better and the and take third X.X% for another the begins year-to-date, the sequentially.

and Orlando Empire Phoenix X.X%, Diego, X.X%, X.X%. were Denver Houston quarter the at X.X%, for Inland growth and revenue for markets at top both Our at San

heavily plan. were in slightly supply growth Our renewals on with the most our than and less better Overall quarter portfolio. Dallas, and are this challenged three markets X.X% markets than planned again new Charlotte, quarter, fourth last weakest encouraging rate rents Austin, leases look providing our the of the In and year. quarter X.X% X.X% third to blended in new third X.X% leases X.X%, relative versus a of year-to-date growth quarter renewals were up up

in basically with October. a of October versus far for running October blended up renewals So X% new increase XX% are last leases X.X%. XX.X% is occupancy flat, at

Harvey that drove by influenced However rate occupancy Houston's last last to which occupancy to XX.X%. just was have a occupancy measurable rate QX comparisons a impact effect year. Hurricane on Harvey The reminder year's effect the will up our October

last historical strong norm last several the level I'd versus close upward XX% XXXX quarters. quarters. Our XX.X% the third In to an finish that XXXX. coming I'd dipped watching turnover years year. the Jessett, in below rate us quarter XX.X% to last homes and XX.X% for have to to thank quarter to appears last let's that at of now Camden's quarter, below net turnover well the remains again XX% over move-outs all over leaving to and from year year-to-date compares like to bears trend Alex gradual the like call and XX% year our may associates at the stalled XX% through a out three It at to outstanding last XX.X% year's this Camden rate in metric in fell purchase CFO. first turn

Alex Jessett

on our to our activities. we for a quarter, I is Park, operating financial Keith. million. end of of at in directly the neighborhood for Also XXX a our purchased Camden XX acre recent results the end Eola to our outparcel Orlando efficiencies. further community Thornton unit Camden the sold guidance, the and providing a the before quarter, we development existing At brief update third adjacent in recently Lake sites opportunity constructed the for move Phoenix million. estate Thornton and approximately storey $XX onto Park real nine of community development This Thanks, $XX.X financing adjacent And

million, This to quarter Subsequent phase XXX third million unit over and existing one-ninth and $XXX Atlanta. development development our one-eighth up construction the for value NoMa storey concrete million community Washington Camden is of D.C. began stabilized end, $XX phase creating will on consist of was lease shareholders. Camden This second $XXX the of in to During completed will building. deliver Camden X.XX% XXXX, be of our we expected Phase yield quarter a approximately in at Buckhead II

For and XXXX, we now of have completed million started development. million of $XXX $XXX acquisitions new

acquisitions We are or in additional any not anticipating XXXX. dispositions

we offering and settlement interest completed on at swaps $XXX of Turning effective on bond unsecured consisting effect recent of this million debt taking rate and discounts to issuance the rate is $XXX We debt October million million repaid XX unsecured giving debt we fixed $X.X assets financing offering. blended October of estimated are from using expenses $XXX The of now on of unencumbered. X.XX% at activities, rate a our million and XX-year fully interest transactions, billion. in-place the after our underwriter's Xst, deducting approximately and repaid of rate is these X.XX% now into valued other Xth. our secured of $XXX a new of approximately for unsecured effect of this repayment proceeds The average to secured approximately X.X%. debt of XX% unencumbered which interest debt communities secured rate After par debt X.XX% XX%

by share, from reported same-store better cost, approximately to expected outperformance $X.XX communities. our for income last exceeding development results, guidance the midpoint non-same-store turnover completed range our This results in XXXX from night due operating resulted expenses $XXX.X $X.XX. cost of million quarter third operations care and net operating the amounts $X.XXX of and than primarily current lower funds we $X.XXX Turning self-insured $X.XX financial per higher of to or from control resulting lower costs, health both and measures, previously from our continued in lower acquisitions

income, FFO operating XXXX guidance performance for and based net expense, our operating the updated fourth full-year and and year-to-date upon We same-store have quarter. expectations revised our our

same-store the or $X.XXX approximately and of quarter, the we per development of fourth current from this with third for the share non-same $X.XX communities, quarter, approximately quarter our in night, the quarter. a $X.XXX X.X%. previously we future result from X.XX% guidance the $X.XX Last and in in anticipated incurred This operating per of of quarter, operating results, is share acquisitions point the guidance with by same-store we outperformance from increase fourth remainder store and of this from Last occurred night, of per completed $X.XX savings, our and earnings the guidance the share. FFO $X.XX points our $X.XX of the of expense income also reduced XX $X.XX anticipated basis net expense X% increase also XX anticipated the anticipated basis increased fourth in to XXXX. by XXXX guidance to increase full-year additional to provided our our XXXX midpoint remainder result the midpoint also our of midpoint third in increase X.X% As same-store actual increased have

the $X.XX and expected We higher Park. midpoint increase share and primarily in higher interest of and and recent FFO This NOI for of increase FFO of $X.XX expect unit same-store in fourth completion. recent of the from increase of quarter the per fourth NOI a and amounts share our $X.XX of our share utility, in share to interest a personnel in declines quarter communities in primarily of will lease-up, decrease be slightly increase is reported range share Thornton lower FFO of developments expense This $X.XX from outstanding per debt $X.XX timing to in $X.XX. $X.XX $X.XX from debt related refinancing the fourth due per and result savings by be share cumulative offset the per offset from a The of represents quarter third as our be XXXX. certain overhead to several a combination a per will increase higher per repair corporate seasonal at $X.XX increase our turnover, quarter X% or share Camden a expenditures cost in sequential driven by maintenance, acquisition capitalized normal partially interest a of from construction approximate to amounts NOI expenses, by $X.XX a development within near net third per resulting our

debt-to-EBITDA is and ratio strong, times, X.X charge X.X at at Our balance a fixed times. sheet coverage total with net

We currently with million under remaining $XXX $XXX over three have years. of million construction development fund the next to

call this no credit of up the of October our $XX XXth, cash we on of unsecured to will outstanding lines have amount and questions. At we As open on hand. time, million

Operator

you. Thank

question-and-answer from will now [Operator with question And comes the Nick Instructions]. session. Citi. Joseph the begin first We

Nick Joseph

Thanks.

perspectives some XXXX? comp from so Houston XQ, but year in Just looking lease and in know pro occupancy you a newer trending next I hurricanes face it's on is Houston, is faced how you comps occupancy and normalized then as difficult forma guidance, more

Ric Campo

tough has the of if XXXX in his look at the providers to we X% We'll about range. are so see part bottom-up we a occupancy in come quarter Well, we kinds X% got down you fourth of ours normalizes trended it’s going pretty on clearly Witten -- and what as process look to expected has all at revenues the comp he where first by quickly of the year in budgets, the data back would one together for because but up our Houston we outlook second we the somewhere in next Ron out, in putting XX% occupancy, different that of is in quarter.

the I So to of that in be do there numbers. nicely. to think recover much Houston don't continues will noise

the last a XXX,XXX job report growth jobs. Houston, think month trailing showed that was I in Texas month that we XX got

Houston. to move that's the a So area like even enough on metropolitan needle

nice until that's coming pretty that, last things continue in within participation begun capacity. job shift to quarters is up we've oil had the by full a seen been growth they've that integrated their without So the two The nicely. and the to much very recent again really recover hire recently companies thing --

apartments job supply. XXXX, year So total going the constructive in I of well next to Houston's have are for bodes Metropolitan terms Houston a growth be is X,XXX supply scenario think that which obviously of a we for area that Houston delivered sort very into in error around rounding

that's X,XXX business. numbers job So our XXXX kind get growth which apartments here if so good really projected is math for really what's in most in of new good people's another we

Nick Joseph

due the debt part just the how repaying coming on the use overall about forward? is sheet, balance going year, of And capital only think month next secured it looks the Thanks. secured like you stack secured of debt earlier after as do the this remaining debt

Alex Jessett

that we borrower. unsecured believe be fundamentally we an Yes, should

quarter first got our debt we've million So of coming the that of not to secured out additional that's $XXX take with in secured intention and XXXX debt. due is

Operator

And Bank you. Sanabria the Thank comes from next question Juan of with America.

Shirley Wu

XXXX think moving like Congrats your in you from higher Sanabria. or to Shirley reaccelerate great quarter, so is is which Juan XXXX actually side outside for this do are calling Houston to decelerate in guys, market on Hi Wu I Dallas? that a set believe of markets

Ric Campo

plan obviously Yes, so aggregated in look all from of together in the we our process putting again at can data of our game we're data providers. markets and

for numbers think Ron look one that if we rely X.X% has the number Witten's you aggregated XXXX growth on little markets his you for into Witten has X.X% XXXX, to in over and and that revenue total modeled what level Ron XXXX got if I on look is to XXXX at somewhere at goes number. he at up about high Camden's most around in

until markets drops entire the process our see have in slight look get part not What platform, XX So of growth outlook the there's improvement doesn't -- that clearly for completion the what board, jobs an give overall, bit the some we guidance we a down five portfolio. each supply, our points we're across in times between at revenues a difference our our just XXXX outlook our little but new flat, we’ll much, But improvement you will every XXXX. of below individual Ron in ratio results the across for relatively is move in to looking wait review of a XXXX for get a drivers to in change for the what's first bit job five little huge as growth little of bit that times kind business, means XXXX, the XXXX think and for new and that happening and completions on about comes the about is above a really stay really for you our if you employment XXXX. and basis of to final

the slight market each improvements. whole and XXXX would look So like individual and overall just just data drilling lot our at macro is look which to not should of at the some looking you a data the say this XXXX process, purpose down budget maybe macro

So see how we'll out. have to it plays

Shirley Wu

any concerned there? That's be and supply like just particular that rent there in about terms great. not Are in of might maybe markets in you

Ric Campo

markets little coming weakest supply that Austin, a markets, supply, challenged supply and right the three in have you we at the Well numbers that we are for out the markets and Dallas, Charlotte, operate XXXX if actually relief little on of little now Charlotte very about any bit those Austin a is there the three is and worse gets in gets Dallas bit better, same. look

be you So to three I can those swimming of on markets think of to look because upstream us just supply. headwinds for continue the

Operator

the Capital. Thank you. Kim question from comes next BMO John And with

John Kim

DJ. Thanks me be again your allowing host music for to

Ric Campo

well Absolutely, done.

John Kim

than on turnover comment higher rate your can average? are On any markets you lower or of that meaningfully your portfolio XX%,

Ric Campo

turnover versus there's look but our details rates you out have when I markets out that you them one and standpoint, comparison, out have of know historical on nothing a you look lower portfolio. that by stand you but higher at when have in if always From look on, the don't year-over-year, each historically

can the like. give last the X% year from So X% would in from be got rates platform data, down as set difference the our we vary offline of you within and turnover in would consistent up as and portfolio, that if we've be data that -- had you've but rate average turnover X% that or across that by you much that

Keith Oden

of market over is really of what's and And think of how is of because kind the the the of just that's moves better job, the unemployment one job and it's have you to and and get are of always it they and one original as and home competition a to from and change that patterns were -- of changed. is difficult a to think in relocate have things new But of turnover like with There's think it's baby a Americans making migration to they different when people and Millennials rate their compared I been interesting has the a job is get just sort it boomers you. moves years wanting about city people the sort secular what today been. more a things, number of low I sort than cat sort when than primarily of the to make a breed willing a sort market in to lot move happened kids

as people Coast a in going that you time. they and then in past been later, married later it’s still California of on homes or into they it and other cities in at the from sort change I rates that of East are children do including the in the getting clearly are think turnover were now of and maybe that. sort not also did they're life the just and staying just secular in some because put Now what getting have our longer kind for lot in moving not or out everything married traditional generally system long But a speaking their taking fast their way people past that's not moved and apartments the having migration of all as and of

John Kim

swap looks But Alex, like the interest that. year senior for effective into reduce to how early Thanks can impressive rate. to agreements ask lock I XX duration move longer the the for? on notes

Alex Jessett

the early it’s period. so XXXX entering part they're of start to we the XX-year XX a XXXX them end for of and and and Yes, finished first so them years so at through we

settlement a then in interest So our years. and full over that against settlement the way it works net favor is expense and net we'll clearly amortize settlement XX net the

John Kim

full? the for is that So X.X%

Alex Jessett

years. yes, X.X%, full X% XX so correct, That's the for

Operator

Wurschmidt from question you. our next Thank of Austin Capital. And KeyBanc comes

Austin Wurschmidt

morning. good Hi,

a X% believe outset recent were CBD the this little be year so I I comments in your Maryland been six DC and so Virginia bit one and of Northern tracking some below markets was you're growth to curious projecting what's without into giving and of your suburban or market revenue the next outlook that guidance, up I peers, of question a months? the to sort your for point particular, there's optimism you First over guess fundamentals concerning XXXX XX from

Ric Campo

the with at and B consistent pretty Metro year we think the DC as rated so operating. market Yes, the of stable is which we're we it where beginning

this year, third DC in was you of is If think X.X%. growth revenue the about our average our metro X.X%, quarter portfolio

first Metro has while of the time been a top numbers, that is the a so that's in revenue in sign. DC this half our So good

For X.X%, the are was think two time. of in largest that both in our so happened third you our DC quarter, half about the Metro and top again Houston portfolio and markets some hasn't Houston

reasonably portfolio XXXX. not the into our the year of but we're end optimistic DC So about through only

Obviously the markets some where My couple urban have benefit years, point will are more it’s As of -- And different have a have urban positive. we you suburban areas other know us in think supply footprint exposure than based lot a just all that so areas. inevitable couple well for at of in and our the a supply suburban starts suburban that's and DC in the next the inevitable in on -- of relative in we has and in transition the been that lot the in very competitors the of have of market of last we're more that's the core. years that urban served lot where to negative a decline that's I these that than is been in we're of ton new guess a the there concept. markets a exposure a areas our been sort more

XXXX where that forward So some up. budgets we're to look them we're we in of overall seeing when about optimistic in in I roll reflected DC DC situated our and pretty

Austin Wurschmidt

about and in Great, projects of be you what's up projects forward? for thanks at some development, the for level development mentioned And thinking you the part then point as wrap pipelines that XXXX, $XXX of that. here early these to the moving as around at we will should far got right this backfill the appetite million you've

Ric Campo

million $XXX to million forward going We're $XXX XXXX very comfortable in development into and annually XXXX. start the

pipeline in We of and to progress between in transactions XXXX. now that start or have projects that land are XXXX those be now able right to

Austin Wurschmidt

And then yield quickly give the development? could on Buckhead the you just

Ric Campo

we started? On the that development

Austin Wurschmidt

Yes, correct.

Ric Campo

still and is we we it's plus so six Yes, cash X, XXs, build compressed. started can started market, But six result at an XXXX nice to XX you what and get development think you a a build on spread somebody around for we or the market an when imagine us building takes Tampa development want necessary as a and very in just cycle, still a you the look and and basis about we nice, when building to that the risk today the it on cash buying of pressure have wasn't in making cost Houston yields over or the just as to could back at X.XX time over built The on what trending in minus. XXXX, acquisition the is first by we us. thing the XXXX, for in and else's doing acquisition time that construction building get increased interesting opposed to a

Operator

Rich next from ISI. you. the with Evercore And Thank question Hightower comes

Rich Hightower

the rates the acquisition question yields compressing combined on just development cost that follow-up on construction given this in unabated with between a guess spread see there, the rates the you market just do increase I quick and So cap base side?

Ric Campo

it's points $XXX development hard that and tightened becomes find were think, the I more compared basis development like million. and have think and past, think really I XXX $XXX million between were side. it's yes, we're think why the ever my right that's where issue -- wide that, get positive I to spreads to spread to people on I XXX, business gotten of million transactions not made issue is making $XXX wider But acquisition normalized normal, part and at Well, really in are the absolutely really, they've career spreads to so the point they in and it's that and where the they

this how make the raising to is because to beginning fourth interesting to treasuries when market you the therefore go rates And is why up. so rates come we getting XX-year cap think But there about and wall because you think can worried is of HFF XX-years. and of at about from from if fundamentals real plus slide and you a cap they're meeting showed cap when Fed is gone perspective, we board rates, the in cap have much thing massive inflation think to week liquidity, and that is market and apartments, really have capital board find decent are conditions multifamily deals needed and as supply done market rates with update up you about year and money coming had and a flow with to the down and and pretty they inflation up current numbers is month. had massive of rates, expectations, And sort thinking have operating market to more and difficult multifamily thing the gone today fundamentals, influences thinking much a of the you demand, the second capital industrial defensive or multifamily trades our the real on that third will assets prices demand XX% probably Amazon the start perspective. The first come and has $XXX home unfunded overheated continues that's it effect that liquidity that our fast from back that's and mark leases when in pretty we obviously into the to cap look when work single relationship the about thing of is and get deals, fundamentals and the as specifically the X% have XX-year. every the people that darlings haven't that about estate the And the of and had estate is rates to is a economy XX-year fundamentals that last industrial. have supply today, We billion

asset a really fundamentals and anything So sought because up but to prices see don't after cash nothing going in or flows unless are there's sticky inflation, or expectations it’s I to cap liquidity operating doing a be increasing. very change stand class massive but rates going or

Rich Hightower

an accelerating standing generating experience, XX,XXX I me but that I interesting the and we get let quickness that the a there? year think one and expect permits in jobs a or ask -- and that's in given helpful of just you if capital mean of response given in it's that to of this year how XX,XXX, be Camden's like do fundamental market like picture That's a apply a supply very going of again question, given I that's something we interested that clearly as and wall if supply evolve up that the down set the Houston to is do still we just see Okay. next XXXX, argument long mean given you sort dynamics wall favorable into multifamily and Houston further capital is market would presumably

Ric Campo

they that's impact and probably thinking it when think interesting of about think and negatively the the a -- permit it, stop this get marketplace, thought has best down project The supply people demand your past X,XXX there when in are, growth always know now, decisions that supply can't supply, absolutely the debt expect the markets XXXX. and supply right news just making start in In XX,XXX on really to dynamics off. -- you they out what's clearly market and really this to you fast you it business that the I capital thought the side Houston America who to Houston entry so of units X,XXX good XXXX equity and and units we lowering to is they increased these are as get part to like XXXX. know very very starts vulnerable see everything the do build today dynamic XXXX transparency you Yes, of from can that's Well market turn are story know, increase because to sort overbuilding. how or what and to like dynamics whack of out increase of the markets and year. non-barrier people demand job on in and and I is of they they transparent coming, turn enough When and the

environment I that issues. will because and So it's done is given ramp cost the requirement many the the question Houston story how the get can think up but given return

Alex Jessett

put completions that's to be correct that, for is has completions in XXXX. and going projection ramping correct and up -- Witten's to he Houston next that and turns numbers to all at think that's as it in year some year I X,XXX around completions his that's XX,XXX just out, this Yes, X,XXX got

So all, area it's get metropolitan completions okay absolutely trend. to is below XX,XXX not Houston going up in but that's going like go to is at job to be long-term growth yes a disruptive wanted the

activity So now predevelopment certainly yes activity best of a Houston. going is out question now in there's right there story lot Houston right there is no the and on there's

Operator

Goldfarb Thank question with O'Neill. the Sandler comes next you. And from Alexander

Alexander Goldfarb

your on there John's issuance. down and morning Alex, Good comment, timing congrats debt on that echoing

Alex Jessett

Thanks.

Alexander Goldfarb

City common just the Crystal DC market first that questions pick going back is two the is So HQX. to Amazon going here, sentiment to for

that developers just view is a your it landlords? or be a so to market, is suddenly great therefore landlords one developers some you longer-term curious Amazon DC the benefit great seems the your impact So think two the just may and get the don't portfolio really to not then operators be and for market there the and longer-term thoughts benefit announces on up ramp your do all

Ric Campo

perfectly that would -- right that prognosticators take would right hope hope all first on a Amazon would I be, other of of be to great, great and on, are you're my they so are benefit and a right the people. Yes, lot be that us

it bit We Metro we last got about question next couple supply a down size XXXX. that coming years, you in that in what's that much hasn't look in XX,XXX back would footprint around looks decent DC a as has And no it. DC as been just this I of decision ramps to DC it and be like completions up on Metro by little mean year then Metro really job weaker if and about point have XXXX the to at XX,XXX the to over that challenge impacted year a growth. been location

the in Witten's job XXXX. historically not The it Metro real and challenge yes growth wouldn't about entire you in is that's on that area that been the to be XX,XXX at numbers troublesome XXXX like is [ph] dropped that XX,XXX look XXX,XX,XXX if on So DC supply looks side. has

been many for Now other markets, of it's portfolio push obviously on supply DC side. the job rents for of the our game in our high of primarily that all Amazon it's rest unlike not at limiting is pace but a the really of the that's changer there to ability been

Alexander Goldfarb

want and buy your the on go to question then or sell practicality jump maybe product? merchant their to versus stuff, spur some on that's more will you your change comments And development to IRRs rising consistent merchant year is rise how advance think who that bunch a guys in sense is rates decision just difficult, given guys the ago interest in their second preference of their been went guys rates could the quicker their Okay. sell decision of money that and out made that pace a the proven but going do in will the for over be rate impact it's sort with acquisition not you of seem these raised what's

Ric Campo

and -- in would might that that thought XXXX obviously we year, happen didn't. Last it

number at for to way happen. from we XXXX stats If down again for thought XXXX, be out XXXX the on of sales there you the going and that turned sales down was it was look and so to could multifamily up be was XXXX about in

the most I is they sheet need of merchant building think there reload able them the past what out builder because just reload to Today banks keep debt sort their to from guarantee sheet have it, no pipelines. to they definitely to the no to more go and to do be matter tangible do if builders able balance just sell stress pre-Great merchant their it. be got product in of to they've banks them Recession, the they you asset will back assets like the the won't their in order balance let because standpoint there so do with could on clear let

merchant prices on impact ability at one that could we constructive have get at want the and is difference that more So selling least that builders to at. the to buy

On could all basically of the sort sitting XXXX refinancing assets cash high instead a we're people a just as selling that equity your and with pattern. holding in though it's seeing longer transaction builder putting of hand deal happening well and including we them more higher thought what sort of with sort other so fair didn’t also margin and be it, number leverage a without refinance of doing of that you the merchant any and a to them was going holding is in out take a happen that are in what's a equity your of

The have that inventory is that think I to question are. take there do be now and up merchant I So going enough ultimately to to the sell. there builders think buyers are right

So just we our we $XXX raise the a issue. of lower the given bit think acquisitions, when capital, change when enjoy decided those that mix even development our increase but yields changed well capital in able might of we acquisitions well our that's though that think guidance timing so and when to you are XXXX just capital, about the as we that does case talked the about to million I we be the why -- and

Operator

you. And question Thank Stevenson Janney. next comes Rob the with from

Rob Stevenson

issue expense that to be and how from timing of much X.X% for morning right. beyond? it’s down your guidance year XXXX down Good are same-store the about savings sustainable stuff the to expect versus you into All moving Alex the X% guys.

Alex Jessett

one years. of thing is is and easily calls, efficient no past are us. cost on as got should turnover all just second it for a really are which news Yes, couple that not you've R&M to that replicated But be sick there none reason often our of believe the mean, our that and I good is of future is, I in very getting is said things that of a on unit people timing It's occurring, all. we're at becoming couple not number as

Rob Stevenson

Okay.

XXXX? could here none up in savings wind of spiking like the from So taxes that is up property back

Alex Jessett

we but will had fact categories and No. property worse you were taxes is where And year are, in X.X%. at property about than taxes. the started if now far we we X% we so other be in were we're same-store yet same-store that this tax X.XX% expense We better assume taxes than expected be to assumed overcoming think we with growth going a increase X% and property all unexpected growth, expected Atlanta property

Rob Stevenson

lease an the Okay. of Keith, the mean your markets renewal new there performing which inflection are gap or are rates, growth of And ones then, possibly smallest have meeting crossing which future? better I point closest that and the between in to

Keith Oden

of gap So is versus better on renewals and of in favor I up, leases our performing markets would every renewals new them of the new falls falls one leases.

quarters. a for of and been number way So that it's

XXXX on and at in look of my X.X% numbers, I commentary X.X% new renewals I were gave leases. on you If you our out kind to, think opening

may we're I above in had one renewals. be see I'd upside of many and have renewals surprised detail you see the way to there but is the between on and down be new leases my single of that a or the our don't and markets our to markets continue at preponderance renewals XXXX a one in but guess where versus other new tightens or one markets shift looking I'm So that probably leases two if

Operator

Thank Trent next from question with comes the Scotiabank. you. And Trujillo

Trent Trujillo

for Thanks Hi, good the questions. morning. taking

that fourth some your noticeable are peers you way so rent attribute this you that seeing of so a your across of yet started haven't in any markets seasonal normal the growth usually would of to? your what quarter, one that and markets First decline portfolio if its indicated in the in comes in

Ric Campo

we ours has that basically far fact just the and Yes. historically -- flat on I in X% I we're think in leases And think at looks and that you October like on look new so data renewals. it you have

what if our look at expect that's typical I we much budget what that's would would at So line pretty be. to our would we where with that's and you that of and how kind for in -- we quarter, have -- think fourth the budgeted look expect

the maybe quarter. than historically fourth our do, So that forecast from what not revisions but original have is very no we our footprint they so portfolio, a big in sure we're who I'm in different seeing we see

Trent Trujillo

builders turning you in specific can McGowan stand Houston fair. that's And us asset remind are development, and on merchant area? offering to Okay, competitively where what that that the concession back just to

Ric Campo

Downtown into your lease when plus that of it unit and probably number maintain the in free on to say actually it’s there's units. depends the interesting minus you your to development or you not and two the are have And in the minute, would market today how about XX% units the the and on same-store many the or expect plus it's have type will it’s interesting wait that and the well one too free developments Galleria portfolio market think still. typical translate revenue to months you because occupancy, people hand, one The marketplace much what but Sure. in Midtown because when that you are that's growing minus people offering sometimes and very a so

portfolio So XX% development revenue that you big that seat increasing have by that of a is a when in like off. to and give it it don't every pressure unit goes an concessions takes is say occupied existing sort an lost, from day airplane without occupancy when

they concessions quick as So very soon them merchant up as trigger on builders filling can. giving and are to the

Operator

question of next the Sachs. And you. from comes Alan Thank [indiscernible] Goldman

Unidentified Analyst

is leasing us should occupancy telling the seems leasing can to same-store implies look we flow it it lease that I'm same-store while not that possible spreads accelerating, or When are asking spreads is in morning. your that XXXX XQ slowing, a at but imply good other thing guide be accelerate? or spreads Hey the guides XXXX right that factors for

Ric Campo

the points, that Yes, same markets, specific portfolios to again into in XX Camden's rates in the back going has basis U.S. acceleration look look numbers up XX overall guidance XX our I'm Witten refer XXXX. you if to about has basis he at you point at overall his going

downs But overall is at variances each in XX judgment to the going So think supply and our over and have are his among points in going obviously be level about be our -- are based that to XXXX up revenues on conditions of I is, those the you of and up basis markets. each will aggregate rents ups XXXX.

and good will we or better with We that's years does he's kind he's in Ron's, the stuff not will two month terms of for know of and numbers -- growth. all or his do correlated pretty that on forecast he revenue correlated been know over in the forecasting our his how a with are I well testing but back

-- the So evidence sit looks like as could XXXX. revenues best kind are of in portfolio that's that here today, should a we the fact see reacceleration that we we in in in we have see Camden

Operator

Thank the comes Ford you. with next question MUFG. from Karin And

Karin Ford

that see higher Hi, of comments can you contribute cost tax any demand? do good about morning. in in Ric, your in your I opening to think you you mentioned you could think from just into markets migration how and evidence that regions, talk

Ric Campo

is clear. the Sure evidence

and it’s in in by easy is example a last declined out it's going domestic negative. even to years, you've and the and see leaving big. that California so to out California good Phoenix in had have mean obviously pull though other California to Austin, births of and -- migration. taken I is migration whole example just you'll California you and census at migration has numbers look driven it’s about; XX because California not population -- just the increases Texas, last by you And population you the down going places domestic for immigration primarily talk -- If people for

lot talk are all running example, and because California. that to numbers stat we markets then would available these U-Haul, our we at to via U-Haul readily California demand apartments going that another in supporting excess those to from go that to when our so the and will from and get a U-Haul for of example a Bureau something look anecdotally more rent when interesting if California it's Phoenix are to to it's expensive are cheap Census another up but with just these Phoenix definitely be markets. of folks Phoenix be they you the folks end it's our we on in And that's cost so trucks have And from good one,

Karin Ford

I'm seen? you sorry, go Have ahead.

Alex Jessett

Yes, track something terms pretty a part some the has numbers in. we just in around because that markets huge our the because carefully it's been story we of is it operate it been migration -- of XX

going we're across XX XXXX XX markets. its get that Camden's migration Camden's to for XXX,XXX people overall So projected markets an of in into

an we an the outmigration cities negative Orange is thing at have that, two is interesting is of and other where outmigration one L.A. is projected XX,XXX, within Now of it's to County about with the be X,XXX.

in So migration those L.A. so migration two Ric's Phoenix, are that XXX -- have in the about projected projected that's have in XXXX is one is markets Phoenix point just we XX,XXX in the other to in California, is so without XXXX. XX,XXX outmigration, to both positive, have included

the cost on So of movement to of of the salt and and and really limitations overall high don't to important states. numbers I large an less this get to that -- is state in overall the in then tax impact probably areas the part lower these people think part these regulation property

So it see. will be interesting to

Karin Ford

if but to question reflected And color. you turnover that's levels, sense you that normalized you for expense last expenses any just impact improved how back do then could my that great have you and growth? mentioned That's much efficiency on your turnover average more in returned

Alex Jessett

of a some on of there tell But turnover at for move-outs So math what looking that years, years. than in if of of point this level seen increase sort if couple we've trends, seems some dramatic to be. to turnover would based this was be you for around do have the trend going sort to couple have we now impact would been what at lower of last the we're I longer we've

Ric Campo

concept. And from XXXX now have one just teams think on decisions of justified up that good, it's is times get at have really that it's are comments making rate the nice, nice dollar business I and of idea it ticket expenses sort mentioned a and a of just or focused this number. focusing focus been is benefits year, that make that a sort attack times really really intense about I that's actually expense And all that pretty doing our this done our dollar on right, as time rate a part because that and a marketing run adds so that's point onsite And save have that where of that’s our on it's out done creep it's embracing or either our not the and job going in for to save was this and from run just a it's can when to just small is even our it's about every the you And sort run let's time have been, money that sure and -- has dollar making we've of it big bit, impact my in that quarter focus items initiative. teams and we permanent expenses corporate beginning gets and embraced or are well. it's be as my run let's let's money the sure a in lot rate, That office. attack though the our the little of revenue enhancing door stuff on easier focusing had often rate a in perspective kind little great to control that on operating on we're this to small long a

Operator

comes you. the Mizuho. Anderson from question next Thank with And Rich

Rich Anderson

think are people trying guidance of anyone get me So out Ric to So, you? when XXXX, or can let -- you I XXXX see if get

Ric Campo

At novel. least that's

Rich Anderson

better do is that because of all CPI in out moving let's When into supply these market course XXXX four of least single of observations? of about you high-single-digit the and a rates. home go type you or obviously pass older, of three even at the business do feel business, Millennials wondering REITs now years and changing think from longer-term get kind weakish you it's So plus like interest the and demand see is sideways at you and multifamily today or of is growth what the more sort XXXX, it as family further how they our than basically look XXXX times it days probably is best about sense over it's XXXX

Ric Campo

good households pretty But that business more or as as rates high XXXX family you I up, getting think homes still long-term incomes so even interest about homeownership home can't perspective feel disintermediated a get get, you and mid-term; price don't the the and form growing much or so not married not is is are you near business, XXXX. of up, if and we that by for our kids made out it about position from They’re we're people. not of to than demographic we have more have the it's business, to average go as of that money we're the would waiting not difficult create the have demographic much like not are popping Amazon, median have single to the hard though know that longer it's are issues homes. -- fundamentals demand

recession to and is calamity continues that merchant So in years let's more we or XXXX, sort also I the see two going ultimately continues our the XXXX, whatever, builders with three we and you X.X% the and peak that continues there will in or supply and have GDP pressure -- that barring said, XXXX I unless a -- be be or then that I be just think down supply legs think growth reasonably or and and any the to up. business to think major development next for four of on job coming have good

pretty So I good our feel business. about

Rich Anderson

better than So XXXX? XXXX

Ric Campo

if would supply demand changes those you between and when ask there maybe me of say it but the be now -- and how say then I would feel and we job recession rates a going is You you told to sort economics, next know, feel about if sort how over have you our off good for if the that have I all same good XXXX I growth three five if people of really year business it's up something today dramatically with bit, interest to now a I are bets about me to that a same hard years, the about thing multi-family. but

Keith Oden

to did, So Rich, as looks at like in side to ownership points started, the and it you or but of weakness the really sales raised the year, rate to the we're versus if in XXs. start you homebuilder numbers as be, new XX% high down most the up that homeownership move-out of at years collapsed just far XXXX. still compish event rate. up to that the be the the what as And in cyclical on to getting low wouldn't going to jobs on seven rethinking going But got the our number so be home think normal was saw the it drift much portfolio we from move-out it in dealt new then with, think could how up I many homeownership to really where XX.X%, time looks it take decade. home it and shows our to would and to supply move-outs got to it's a people week the for But lot purchase in the Recession back the down and you that was is a a to really or we're need in homes purchase so, ago would believed or the for continues our this argument this things. in low just portfolio purchase numbers to secular what we're you was it think that ago just sales back all how And kind in supply, terms it homes homes people result we rethink which bottoms started up. which away back that I last and new know add to forward data, our home we a it to of multi-family one I to time sale you and eventually long those. of by we're it's the one housing then but in puzzling I'm going time I wisdom move-out get ownership Great not least and X.X% Great was the that different been it's about in now of conventional range, maintain or look home or numbers home homes to traditional at six cyclical it’s in announced this XX% the of the that it in of over you the a purchase before rate that the bust in prognosticators, almost drift crazy bottoms back Recession the right at lowest ownership back as a in move-out home if supported which they started time that demand puzzling to portfolio that our fact historically But and portfolio in drift would you the get think the different telling of rate new a that, think never metrics that I

-- it’s of be you just of that and side I on right, on would the Ric's side argument. if other have an it’s to prefer I our So interesting be one that or to argument, time think

Operator

next Pawlowski Green from Thank the question Advisors. John And you. with comes Street

John Pawlowski

in reasonable year fair line? development million betting on cadence the of acquisition thanks your next for in $XXX volume Yes, starts a is comments

Alex Jessett

and in last to a properties We really time a haven't three yet. five that We've of lot the sold years. really big point turned to portfolio gotten over

a hanging fruit have low terms of dispositions. don't we of in So lot

So here yet. it market depends hearing what summed acquisition our But guidance see robust in just given have and seeing now. don't what a year what really on really we I haven't we're kind it of we next being but right we're

John Pawlowski

Okay.

of current not market think perhaps right do you to is a Some your perhaps where now, you if would footprint and or take that rationally full into reposition competitive the don’t truant another really to into agree low and that market I outside more you ever cap exit but of you the dispositions a sell bid less something Phoenixes world markets undepreciated? of or know the competitive think rates, tactical

Ric Campo

clearly development sometimes done properties the transaction, Well, quality, we hurts that rate year markets ultimately scenarios of does of portfolio with of a so we where our affect to prices through sort the one knew of reasons execution it have and risk associated long-term, past then have and of going exited billion we that taking the acquisitions. sold we've If a low my it's for at when time reinvestment the sometimes kind hand all like it’s of little five cap lots long-term the we're and head with to look makes was long-term, and in deals with of for capital really and and I the Las getting take risk deals markets given you do sell and risk so sense lowest or or it over tactical, and on market. in you accelerating really hard it's though. do done, well it's next $X property a issues. the But between right risk issue important but we and should that in me go but years what the to of right. do, that the advantage it move-out cap property highest -- billion what sure we billion interesting just couple it doing us thought the two not, can was we Vegas to that last We how that replace I'm exited at not of we’re because We for we the rate be in the that us like regard of that I'm of at

Operator

next the And & Goel you. Thank from question Zelman Company. comes Hardik with

Hardik Goel

lowered look to get them there or taxes kind you what's going expected that your some appeal sense of to of nature the wanted something of expense have trend? that's sort when at of has more the as success the how you on at Just so detail of been the taxes, beginning would that's year side, and

Ric Campo

be the Yes. going are to again by think driven delta I year up expected Fulton in to X%, once we going thinking higher tax started property are taxes be up X.X%, values in we that is Atlanta. than entirely now County mean that they

taxes. that sort with of property so And we're having

trying property think X.XX we that of million quarter the you're understand we of is fourth if X%, you be year-to-date the a entirely you're refunds about I and XXXX, looking to forget in get property Houston tax replicated. not in to can't taxes had and going at to almost how that

So at and delta, that’s comparing again if the we is think looking which that you're still you’re full-year once X%. year-to-date our to

Hardik Goel

it. can where out to about do look And it just peaking, decelerate before steadily is does ability is have you you sense. to the you going visibility makes as you say supply meaningfully of question then XXXX, go lot it's one where peak see really from? and XXXX down than supply comments where That it a guys you ever further your talked supply, see Got now more better on and regarding

Keith Oden

these flat We he down with had from only Witten are slightly XXXX got numbers XXXX has Camden's the across completions out through in XXXX which XXXX. numbers, is basically portfolio and

big of through you're is XXX,XXX, Camden’s XXX, Witten picture if So progression thinking XXX the platform, XXXX.

they're round XXXX the are push I even years function persistent a think that first get where crafty have it, would there pull Ric and total has hold deal they’re they to and to you and a dealing And be start just to that that as can and builders pencil. merchant that of Ric way figure if have know could pressures and if less I is their getting get so and shot is out numbers of But think the what stretched terms the then new do pretty XXXX with. mentioned, will meaningfully in you they're they that all described a a capacity and the at can math done, is difficult they the deliveries.

possible the it’s for you in time supply first in think pullback I years. a see and in XXXX So would XXXX meaningful

Operator

next Bernstein from the question And Capital you. with Thank Daniel comes One.

Daniel Bernstein

conversation want wanted you are moving age home but of buildings in Rich, seeing don’t to age you out with change people the in and average follow-up ownership? any to Just had to of are maybe academic your on average too get the people living

Ric Campo

are seeing whose in suburbs a and big gone, these boomer, more America. across in anecdotally people traffic all Well, lived that house, baby still in first they are hearing kids are sort live boomers of pretty we is -- of moving awful

apartments. somebody probably for So the in have in our closer happened amenities Houston Galleria years have in higher properties product extent for your the average a is in last able it's it's they some desire to a any is versions that's are is so the their more high hotel over as primarily and moving the core. more portfolio And XXs our one it's traffic example have are baby we really certain just older the age the the folks that the to the condo that years because who that. of arch properties as walk driving -- are like like average And be the a definitely it was the one urban to things that's like of things where rents to are city cycle and and a past, amenities to be in XX really finishes But so And into boomers migration. of than more the the are just, and and high end, into in to to think you age that the sale in not end property. those income development XX walkable not today for rent things who people all more the XXs, like has when of much appealing and that the XXs than pay are high for that the I

the XX people mid rent then eight is own. at look And to last then is always the you starts XXs over years into that you the to to If older increased that. a our website shows or for on very up propensity their off definitely high propensity NHMC that did XXs to Mae to or rent there for that is over Fannie website a propensity and Fannie and think I the positive until actually too business on a and is that is find falling And you it that's rent and a propensity Mae that study change. rent, question seven the about that -- for the propensity have the people. statistics just no increased can is

have off like today. for to The houses hasn’t of people their because and low really here it's pretty buy year student And buy then debt maybe definitely to it's out to terms so of to think have much people there. they a terms age limited or houses, because dramatically increased house. age in buy that I pay have is moving In average they so and issues that changed a ability

Daniel Bernstein

to situation, about that. that Yes, just asking much current specifically know you I didn't track relative how so the

kind it's increasing to GSTs, the mean for had private leverage track involves that world -- to are equity to using out the buyers easy last everything get if on rates The any the non-bank easy the is in increasing, move I the easy whether had their thing rates interest track cap banks to I LTVs are you had rates. buyers. are gold it's to I IRRs there, you leverage that other thoughts in and question a with don't LTV's conversation and the I is going you financials was the that on though as agree said the you track -- increase not of Have actual are private know equity cap seen those

Ric Campo

is answer the think I no.

marketplace, leverage buyers no not any low yields I get whole the they're property. putting leverage increasing, in the fact leverage think that a lot where as using very on there's non is debt people aren’t of the matter leverage of to a and more

high in leverage buy normally achieve are the loans example the more expect. floating they fixing floating can their the So forward that and as I levels for do are a they're look do relative think loans all as than you more multifamily curve than not done at on far really of you so as would so rate are people on caps, when when you as -- half LIBOR are basis people are getting at leverage they and as

Daniel Bernstein

just you are point and it. at more going be would think cap color. I off. up get in good now I'll this Yes, the rates that's cycle hop appreciate

Operator

no you. at are the time. present more Thank there questions And

comments. closing So I'd to the any Ric like return Campo for call to

Ric Campo

weeks Great, call today of at next the you a of and on NAREIT we see and in be the sure appreciate being you couple will we I'm lot there.

So thank much very you NAREIT. you and see at

Operator

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

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