CPT - Earnings call transcript Q2 2020

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, welcome to the Camden Property’s Second Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Kim Callahan, Senior VP of Investor Relations. ahead. Go

Kim Callahan

thank Camden’s and Earnings Quarter for Call. Conference you morning Second joining XXXX Good

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

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

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

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

Ric Campo

heard unprecedented that It’s state days current are common days on-hold are strange strange this believe definitely agreed or our for these while refer age I’ve all most these was are not common people The that days people is related. I’ve some of whether unprecedented. almost concluded to affairs indeed. for It’s life the of strange to during days. Thanks, Kim. pandemic, ways one today theme music

were ahead thus playing and both days go this that after on more Doors of likely pass way seen are In named and the to older we’re rock our old together. new extended song. situation stay team unprecedented. current during period time strange Strange indeed People next orders in far shall were people true of unrest from less to was when to civil the far this continue see musically XXXX, Days. us. Younger shall bring days We’ll naturally The casual is Strange years we’ve have and days all unprecedented. than promise to XX their too culturally XXXX or as We current strange a town. Why. and storm. the are of stranger age background of This a bank that. I’ve released verse likely and Clearly, a my a The first joys. these I’m our song I years optimistic you, find going Strange encourage view I and us a They’re COVID will to tracked days titled destroy, since to an magnitude as Doors Camden Camden’s our the found down. have few

expected the and of US our with XX.X%. and lower Americans rents the overall. that benefits unemployment shareholders. members, an markets occupancy. geographic continued of product market XX that in Camden’s of to team rate for close have has the fewer given being, to Sunbelt a filed demand a our losses volatility nearly Camden’s official is job diversification and strong than to unemployment have time. for improve market million is the purpose Our experience lives residents Apartment One we’ve at than in

to the prepared we well to work continues points that very that to and varying Camden employees very, Our flexible work adapted amazing offers in urban locations was great suburban culture have have current pandemic, mix for the and workplace environment. a and price product us.

systems Our us allowed portfolio not or technology and investments when to comes making like a miss or that. basic in moving beat leasing it to and access our based to operating cloud have things some operating the systems our payroll Chirp

continue sheet We in do prepared replanned prepared sector have we can We well the the best overall. balance to this and in one were as of the best as in be and environment. to

our other give a our I couple every for we’ll Camden’s they I Oden long-term. him. call from care all of turn well and I’ll over day. think to each Keith single amazing for Thanks. to the teammates shout do to for do comments residents want out that taking now

Keith Oden

Thanks At Rick. market. you taking of find Camden most COVID residents. we the want storm, we useful remarks all time to brief one, information want possible today prepared our to our Strange outfit sure we call providing as the care that days which the an for much as held state Q&A. current team during you your our we’re that the told Camden will be make two, family to allow we with understand Camden and priorities of conference of care indeed. ability as in number were of Camden’s our My that affairs highest taking to

promise. Fund. good our team to frontline almost Relief grants X,XXX and undertook the bonus on Emergency initiatives associates During Camden made members a long-established onsite We provided various we second Employee our paid we XXX to quarter, including that from

On pleased the established and the quarter into we so. relief were level we confidence said to like teams of we next probably visibility based that was not during X,XXX reasonable we fund time to their our able of a on finance thought regarding from scale We conference of were we level On the impacted At crisis. financial time reintroduce quarter we to and would which when this at could people our a projected we operations who the provide provide XX, call, May guidance had when asked the to to of we it felt be COVID stages do first early We in results. our residents were two, June from resident good. financially had we grants and that uncertainty maximum one a also that Camden lives. to assistance were able

in a we’ve for As long which it be call here confidence living CFO. while been today, Keep And than now acknowledge I [ph]. the amazing it in see turn to overdue, despite times. we changes to sit you expenses good would for do we third job done residents quarter normal we’ve to feel It’s We so. less done the Camden made the guidance our the provide is soon. our to Camden’s to has level the up want little the we’ll fortune, to policies, sufficiently to were provide continuing Alex is team incredible Jessett, whole great and work. with protocols. radical procedures over our I’ll the and

Alex Jessett

Keith. Thanks

were X.X%. quarter new effective X.X% renewals leases up of second effective the XXXX were a For rate for down X.X% and growth of blended

indicate improved effective XXXX the decline July for XXXX. and of leases for lease of Today Our new during has to in quarter growth averaged second to renewal a X% for of quarter occupancy a results the XX.X% compared X.X% a XX.X% decrease X.X%. second XX.X%. Occupancy our blended

portfolio slight for residents the method in second XXXX year-over-year. same with monthly the when to property X,XXX We deceleration X,XXX XXXX retaining July XXXX. is existing signed in averaged total quarter alternative our we line we leases compared signed leasing of signed tours many property July continue and In have activity to conducting activity in perspective quarter, great only our residents as of averaged second success leases. leasing total a in with

to second collected scheduled when we with XX.X% X.X% collected rents quarter compares we of X.X% XXXX in For but deferred the of This XXXX, XX.X% arrangement the and current our of our second quarter delinquency. X.X% our rents slightly with higher of of a scheduled rent rent delinquent. the

with share a XX.X% operations $X.XX ahead quarter rents the in July third of XXXX of our from first of quarter night decrease our of from of funds Last scheduled the $XXX.X $X.XX is share of per we second off of collected or reported per XXXX. The quarter in a sequential for representing July XXXX to XX.X% FFO start million collections XXXX. strong

in release also per $X.XX related of basis from sequential of and approximately lower million an from aggregate second $X.XX quarter. in an issuance. quarter per occupancy basis night’s sequential development of interest resulting $XX.XX quarter a decrease reserves same impact last this re FFO included XX this reserves the operating NOI to $X.XX in is a sequential COVID resulting second XXth, sequential $X.XX from and approximate the $X.XX quarter net share decrease in debt resulting share increase approximately Approximately in in income XX April points decreased in in incurred our first a increase and excluding share the in store same higher XXX decline, bad our from After $X.XX share per resulting revenue non the from resulting quarterly from store points in per in outlined $XXX occupancy from lower $XX.XX points approximately and venue primarily combination bond debt during high direct expenses. charges expense share As approximately $X.XX share $X.XX retail per bad lower the in decrease basis per

be this property and what is We bad us debt, establish by to offset rent serves period. appropriate bad revenues an same Turning the month. to corresponding as we current accordance rent income uncollected in certain GAAP recognized debt as to the with which evaluate reserve believe in in then uncollected a

first store approximately in income approximately As XXX quarter. bad a previously the second percentage of mentioned, basis in from increased to for same debt quarter as points rental XX the points basis our

the have for half income the second $XXX,XXX. We to of and not is and rents reserved monthly all second owed amounts statement. debt. amounts bad debt store of the X.X% totaled second of we moves arrangements no and will Also we part delinquent third as bad of for for recent deferred bad quarter, we impact already which quarter, XXX% store. debt reserved issued reevaluate the guidance as reserved In of reserves same our rent quarter. our retail night trends, approximately not all same the uncollected debt. we XXX% based Last there When which in the resident quarter FFO a future the effectively We collectability. out upon reserved bad of us effectively money, During owing deferred be as of X.X%

given impacts an not continued However, the for update social financial time we the our year. from outlook uncertainty the full to economic this COVID-XX and at will provide surrounding

the compared For quarter third at XXXX the to XXXX, midpoint. of the of as third quarter

to decline by store miscellaneous lower higher primarily We and lower income. X.X% driven fee same debt expect occupancy, bad revenues by

XXXX. driven refunds and large Houston by Atlanta quarter assessments tax higher X.X% the expect by third tax to We and expenses property property in property of primarily insurance, increase higher receive in

the at X%. NOI expect we midpoint to result, decline a As by

FFO expect the reported be third to in for to We better the second we the quarter. of The per range is $X.XX within $X.XX per $X.XX of $X.XX. quarter than share the midpoint share $X.XX

second our adjusting COVID quarter after related results previously for However, of discussed the charges. $X.XX

decrease midpoint market rents the share per for result $X.XX a per a and per the $X.XX resulting per resulting $X.XX sequential $X.XX $X.XX as sequential share store decline an the resulting Our typical quarter share and the in resulting increase store tax in increase primarily non of same per property from NOI $X.XX from NOI from issuance. certain And primarily $X.XX from primarily expense timing and a from XX is revenue interest share same third net cost a decrease expenses certain resulting sequential the primarily and refunds seasonality expenses, in April sequential in of of assessment. in reasons same our bond per decline R&M share approximate our share operating approximately of lower timing

$X.X debt today, $XXX our end, had of $XXX of approximately on $XXX quarter million maturities to we unsecured cash facility. no the over pipeline and years scheduled X.X credit over under equivalents existing cash outstanding next billion in our liquidity no until spend of million development As and have XXXX. left have just amount million At and we comprised we

technology. on cash finally, various bank earning invested And excess XX is points. a Our quick current approximately update with basis

As great our been virtual close, second success a impossible completed without leasing just our based so teams are having our and we financial on-site with I discussed task cloud that much virtual a not in investment if harder systems. quarterly would nearly

At need we’re As no smart our and completely physical fobs a more There Chirp in enter applications we’re a self-guided keys the can ever as the to access limited tour touch yesterday Journal, solution for technology. Chirp office. the pilot specific is great the leasing use the utilize access apartment Wall of homes success our community available ways grant to pick mentioned Street continuing both leasing prospect with our even to up communities our for teams access even exchange. or less tours, finding or in to the pilot and Chirp prospect

account, create the Our apartments. prospects unique to the access determine when and teams wants leasing Chose prospect and best the [indiscernible] grant access then a needs expire. will Chirp their them and

more utilize such at application environment time. the so can access even to those amenity up Chirp center as with as timeslot. up the access control and of residents does to confirmed At specific number residents door have the to residents require the time, Clearly, this Only open space who takes will Chirp we Will amenity. COVID space initiative time. Additionally, the deemed of given for Chirp access automatically to importance. have on only. the we’ll reservations amenity any the reservation expires, to a reservation Amenity an questions. fitness call the this to spaces open a access our quickly to reserve allotted use When in

Operator

[Operator ahead. Instructions] our from first America. Spector Jeff question from Go Bank comes of

Jeff Spector

the maybe the I markets drop specifically about guidance. the you particular debt. even you. about for lower more Thank in helpful higher and Phoenix. XQ initial We can see think guess occupancy it to talk were bad Houston surprised Phoenix. I might in occupancy, talked you comments. thought little I to be talk on X% Thanks a bit most Alex, your

Ric Campo

our Jeff, weaker to Houston be continues one of markets.

of of are is business continuing to The a roughly deliveries area continue Downtown, still and place apartments be [ph] we to in that to in deliver challenges according in most headwinds coming brought new to process the see two are Vitans pressure. numbers lot scheduled we scheduled online. the impact Midtown under Houston. energy But so where being those have separate is also, in the the The obviously from COVID to online. We XXXX were be and XX,XXX where

at would issue in platform. flat. that going renewal to more bit July yet already the for the was X% pressure renewals went as leases It’s of growth environment It’s XX,XXX that irrespective business think in the business high renewals absorb that to So or to in of challenging that, the terms renewal on out are would are - apartment, not where energy job XX,XXX energy so at have all. trying those of the job and under X.X% renewals out little basically an that Austin going end Houston that the related environment. it’s of one are a I that basically been apartments out as in an top out the losses a be of overall the Houston, of We at Yes, from about one going in flat. July markets and mean our low across at is across then our be

more we’re standpoint order out terms back that market sending in we in, from every of with are like renewal closer So increases. feels a operating it getting regular renewals certainly to

perform continues It of been to to two It’s continue in that little us. weakness. have last bright is growth for in think the the Specifically weakness market going middle decent going markets we but be not normally bit of we rental strong we would our to at than occupancy for summer. for spot us. of that projection what is the years be The seasonal always have see continues drop more a in well forward. and X% pretty that it’s it still Phoenix We the a unusual have kind Phoenix, on and one to incredibly

Jeff Spector

Thank you.

Keith Oden

bad of occupancy the to and relatively third comparing the of higher quarter XXXX when flat XXXX actually be expect debt, quarter we’re second we to We Jeff, talk in quarter third XXXX. quarter occupancy lower And the the about third XXXX aggregate. to

Jeff Spector

Okay, that’s second if My Thank to know. ask. you. good can question, I

Are rentals your past thing you peers this Your single family to an talked Exodus quarter. the same seeing [ph] markets? about in

Keith Oden

move XX%, our even lot apply buying Obviously to the in in it But still haven’t of with that market at now. right houses to out profile but houses, rate slightly when up apartments were or look rent are buy or buy single in range. with houses flattened generally increase single it’s XX% the houses. marginal homes single-family out seen low low are at moving said houses that interest folks the a with to family you just and quarter, and folks and out going The any rate. that demographic so beginning with speaking went our They’re go of really living interest we not buying

Jeff Spector

Thank you. wish I everyone well.

Operator

Nick is Our Go next from question from Scotiabank. ahead. Yulico

Nick Yulico

are is actually because some I looks bit better, clear new leasing just your get like question quarter. to second here of want it improving dynamics the And about quarter how in it a third like on rest renewals you’re trying July did on the things just the It that renewal or First should be pricing. second I the renewals versus getting you sounds the the little now versus we better so, are year. pricing just understand in to doing rental worse think mean, of quarter and the think? also

Keith Oden

increases to not XX flat. little process. did then as a the we to going turned XX at shut just they’re the renewal getting first days the you’ll no on XX though actually the just of we from so a recall we’re offered Well next and We COVID perspective better. after was at any for down hit, it that days not take it for storm if right policy renewal mode. renewal Part out went there’s everybody to We XX side, that question days

on turns you’ve from measure X% no had idea demand standpoint or XXXX Now, million Probably. gotten hindsight, the thoughts just from X% to have One or increases? the collapsing was how we But could of evaporating. could we two in XX XX that. out in as it

So to there have you place, resident a great every was that keep that you possible. in our it’s part concern on need that

So part of it. that one was

The a second more. really part it was - more was just of

of apartments of been to close in case resident have every been all had kind of their home. spaces. at terms most them who mandated And in almost amenity In we time, to from shut the working

they’ve to rental people full losses even that like couldn’t they felt they the just million pandemic, tension was be a So the use even residents are to that XX with $XX or where the from leasing at pushing to so it that in just what have terrible for, through in consultants we value have job amount bargained residents and who increase can’t of the create of from would that It part protect seemed that kind midst amenities. our get rental our and relationship they idea then trying of to timeframe. not time you increases residents come to a $XX would of proposition

of back of place. the achieved our been So now what just net different regular to the first have a it’s under is, all were order the that and could year in and in really obviously renewals probably we’re half

different place. in We’re

a place. residents are different Our in

the they’re part our most open, For But amenity spaces with restrictions. all some again. open are

tiny the in renewals. where July year. expect up on results were So of just in better But a than we better bit tick we half first much the leases new from

and with I and occupancy activity Is between lease for above new think that able more the importantly renewals. rate were XX% to we us. the maintain

it us that grow going to gives was forward. me to there stability something important to on, the more and So see

Ric Campo

one hosted then industry with even was, people Bibby renewals, out uncertain came Let the in fees plans residents governments to Group, face banned team. industry in very the to evictions we on payment flat set that. terms a for along the principles of We like Doug and leadership with team the came no and and me a before the bind things all like practices or a add conference things up the best pandemic his NMHC the in of with of way were principles late time. as were ought the just and by fees, just of an that. we We work call that. and And that about, was industry pandemic, with Early the late help

about the industry There could the did not and folks that and and we’re we they to of not into customers just the it’s uncertain pandemic industry so that’s really complicated to I in during trying the know renewed our Sure followed that do this chose time. which leases rates. we now. right, and very, you really job just of first some four part think in I showing a Keith’s have just to But is industry their all thing it at the and that care principles help a didn’t think The our of compared rents are their great point. did decent of it those customers nothing that, very that. months And culture. raise interesting financial to about they is crisis most like

sure And about think so, care how I you -- you that making long-term building customers your about that so treat you all that and them. when actually your think and understand uncertain customers. people brand about It’s

Nick Yulico

thanks. helpful. Okay, That’s

would versus have Hollywood, definitely stats rise question you have in of provide you which in nature think second you terms any portfolio Washington I you on total not. I of DC. buildings high Just think mean, your product some are can if be, the

Thanks. I you’re demand in any what for steel And as whether would more think you rise versus seeing stick in have and high-rise at Houston. brick difference well be product product? type least concrete lower leasing one

Ric Campo

I the or if news. us good For know it’s good news news. don’t bad

take mid rises rises. many have So just have well like example. - low as an we portfolio to We don’t pretty high the balanced and Houston as as we

is We’ve our six storey. us change we might demand think Because go rises to really as which then actually and in lots. now, built about We rises, storey, those storey and for we in low have you or is market Houston. markets for in two to building same older years then have in down go DC stand-up midrise that Actually no DC. We some we building and HX a and actually portfolio high rises storey. three a have are ago, are at that HX a XX high we two But seen right older XX two high great? Houston XX where built, property some as and properties you then then when

suburban, mix seen really many So of and more product a density think differentiation mix for rise we rises. that haven’t lower is we about low we have than or really more and sort generally the other lot B don’t don’t speaking between of but more in rise we’re see And all geographic a part sort we demand the of in I A. of lot that high tend skewed towards variation same. of of to high though suburban or equation and It’s be we now, that have then collections given any product. right

Nick Yulico

appreciated. Thanks,

Operator

question from ahead. from Wurschmidt KeyBanc. is next Our Austin Go

Austin Wurschmidt

what the debt. did year? an XQ It assume debt bad and because on like revenue the same in much you then were second was the It quarter guidance July first quarter store your XQ curious, than relates actually for I growth revenue data. to both last of how in impact of they had same the bad looks collections store from that and better

Alex Jessett

absolutely so. Yes,

basis basis the As from points went XXX debt approximately the second points bad quarter to in quarter. first I our XX approximately said in

a basis on basis. and store direct at look that, points that’s reduction same a can revenue sequential XXX you in So

got we’ve go So you can model basis. a look our forward on math that. in do what the at we on When

around basis third anticipating XXX drops points so get right somewhere it XXX on quarter to We’re goes XXX so down debt to and bad that. the hopefully we’ll pickup from some that

fair pickup re-letting will We lower did the did offset folks be be slightly is of and leases. by as their rents that quarter income re-letting in have going Now also second we to slightly income. offset net a by get lower market break amount

Austin Wurschmidt

Understood. it relates Chirp. And to then as

think across what’s can rolling how should measuring us, kind timeline that and of out then about the you curious the that? remind portfolio guys and you returns there for we how are Just

Alex Jessett

Yes, absolutely.

to about and components. have you two Chirp think So

XX,XXX the the our we of also out controls amenities rolled end gateway really etc. right Chirp entire to portfolio year. that the the the have rolled space expect is that’s the one first and gateways across gateway around The we’ve access and out by controls units

is, also about individual component unit curb-to-couch but includes and second call with this we the point locks total we’ve have to sales. of year, [indiscernible] probably X,XXX will about The by that the goes doors we next solution what gateway and rolled expect the which that we solution out

to having benefits to this. out jammies not go of their front door COVID-XX gotten all resident it’s to than across folks, gate was lock our was straight entire for knew originally pizza get of we what able never out locks, button really be and gate their down that not spent, we we’ve the when rolled thought open and proposition at So It’s and would that on of a it that value and to gateway things push time having the and additional vendors proposition the value also rather in. have portfolio. to lot and embedded from We let looked around delivery interesting then are front plus looked re-key to we of at the some a walk a this, guy there in up. people letting etc. to the

to And This so we’re is apartment be must at of all at that a we But capacity. XX% nearly you we I still the for gyms point look enforce. typical quantifying of say, a will to capacity see XX% that operator tell trying impossible benefits. or orders when the

can and can do very access When is application, easily. we we industry. Chirp virtual our it leasing our do with that However which undoubtedly think about we the of future

you opens application doors. that an have virtual have access gate, can’t unless You leasing close

the in ultimately, a the additional that huge differentiator still we’re for So we’ll quantifying. ultimately, benefits differentiator there Camden lot and we huge are is for think industry. a But of this be process of

Austin Wurschmidt

an think returns what generate just just perspective? resident perspective it you’re measure that from portfolio you additional think and overtime are, So you across a offering attempting demand the entire all and satisfaction the the is will value just

Alex Jessett

right. exactly That’s

at or apartment Chirp, to of they Camden guests got ultimately who all off of community look additional time to walker take a realize their think an at have have dog realize another into work will that their meet has I their they will they let that they when resident gate. and front they to at the when

I convenience provide. and think that pay to will have will Chirp the to have application the of the ultimately us they flexibility

Keith Oden

we the some savings that. people think you is relieve I goes the doors like issue of lost have and people about serve think the in emotion ought allow fact to and to cost our with us on other customer keys because a on-site and having and better. their when that be help things open keys number to cost It

Austin Wurschmidt

it. Got

Okay. Thanks guys.

Operator

Alexander next Goldfarb Our Go from is Piper Sandler. from ahead. question

Alexander Goldfarb

The just sounds can I’m different interesting, that be. Chirp pretty all the uses guessing given feature of

just two here. questions So

is, rent eviction not off I percent basically missed not maybe some they’ll loading? how in will not are free think What there’s I’m rent? the but the moratoriums pay The sure. first paying hopefully residents go many with do that Are pay rent, the rent there you your aren’t Along are those accrues, once saving money back and interest it. and versus California of just over, in that paying you

Alex Jessett

ago. Obviously, improvement it’s actually contracts improved it today. has we’re tell It’s said, delinquent enforcing where market. I folks it significant four as start So of at able at a delinquency as tremendously. California X.X% time when percentage still months But from will was is you look highest to our But July those what pay. about

Alexander Goldfarb

was And it four ago? months where

Ric Campo

by late government. I They’re there’s kind banned no the of stopped because fees.

you though look really Houston for I it’s in at think instructive when example.

of you they and the know just them Issue. sort change. even not ability. they they this have it messaging happens range issue to have they resident late of that pay know evict or I rent ghosting can’t of the don’t Their on negative whole they so there digits. creates, - fees. you not mentality you gets just Houston and They’re evicted is don’t you the or limitation is, of what you It a and charging limitation Belt be call Sun that of have have pay hazard point to Mayor ghosting. and if it’s X% sort they a and little California to different Our in Governor. recourse, in have and are They we and just our the interest LA, the somebody animal. any out you’re numbers have, and serious fees scenario to is you’re listen in of and I up think is X% markets mean Which if most California, Government California money X% time, show just able a should it’s don’t the morale just single shows worry The people the they - don’t a their being late and don’t think,

Alexander Goldfarb

and So that you pay off all Ric, are view that or you them your is most as said pay. they wrote the them wrote people Alex will to you off any when to expecting you’re these all not delinquents people have and of

Ric Campo

to your them pay. writing on folks that I the care But aren’t people - care the have pay. credit you A ability actually care credit paying going We’re to that their about paying. They’re off you’re based that not think about today of if just lot and about our policy.

modified and government have might be when bad policy people debts. the actually accrual they them we tells clearly debt pay do the increase But for we should pay. So our surprised that bad

that people apartment an that number rule process folks think one be during it’s to it’s they educating credit Right. a think going of it you’re period going with saying, think don’t That actually I up it not California think going you or and free. run pay so really important the next do you’ll and get lease problem because and you it. the of is think people probably there’ll we’re we’re really foreclose say one and And anybody Number two, and educate it’s A and of in that to you the free. have more able on are important be industry lease get that to is that, that have or if education Apartment going to it. for your ruin you free. the not and is And debt to do to try is interesting don’t Governors that apartment wide is is credit to not the lot Associations you’re but because real then to a sort okay, when debt pay that this no trying Mayors the debt get people and evict like I I things evictions. system means, a

Alexander Goldfarb

is, the Okay. your like sounds comment it year-over-year. you’re to and stabilized you question And second while mean I occupancy, then guys everything is expecting lower that’s

from fees. from and in you’re third the really some and quarter is just lower flat debt bad continued the basically, So impact the quarter second

So do increased I continuing coastal experience your had think accelerating unfortunately mean to I recently. you have why a guys your who weakness. fade than holding better portfolio up seem the that guys guys doesn’t urban But factor. you to that is markets, guess, COVID are

unrest, be do in just protest areas is on accelerating? you market your is less seem it for it the going think what the of you seems social is where guys what stabilize or less So it, coastal to to

Ric Campo

think it’s exactly I that. Yes,

and been comments. I higher job significantly I as I fewer and There jobs mean one they’re in even your the at the the an where think of can’t unrest urban look you in job you markets cities. too. nature number Belt you not certain when social Sun takeover there’s look property some are as earlier said block have When the There have sort my because to many markets coast at losses. of lost and in get issue losses.

more been think recoveries, the driving and So about when quicker before jobs I recovers about you markets all it’s generally. our Sun that has think the Belt things

jobs really so than anything. issue And I a more it’s think

Alexander Goldfarb

Okay, thanks.

Operator

Our is next from Citi. ahead. question from Nick Go Joseph

Nick Joseph

to continued expect into unemployment. bonuses and this you or only mentioned or currently Do tenants relief elevated not uncertainty the frontline any macroeconomic given incur? You and months employee more four

Keith Oden

it to downturn. quarter. any it do preparations. unlike previous happened did urgency a the Nick second really and employees earlier scenario, to Yes, people But of on what in were, lines good Friday that both in on to a our way some rationale it so timeliness got residents an and to layoff and people is comments. relief Monday, It was your plans make were Camden that anything my rolling adjust along job of you to there gone to always who we getting out was jolt time think was financial don’t impact had is and you the many in bridge The residents was affected. this The have and This available addition through happened the there laid benefits. the it time in that’s such in the people so happened. to relief up the Camden just through employees in it. was Where to stimulus, there currently get sort the was of a happened permanent to I’ve that, a scenario some more both and was to to gap a we to of impetus And plus was employment on where for

average most our about we an that household now that. seen payment to in But Now where of of there’s for about they is previous provision what about - plus are unemployment income the honestly have there’s going lot your the residents conservative average up, of XX% - income that where is extend wrangling not the extent. about even $XXX,XXX most they talk in the and Camden scenarios including rental of XX% into I’ve provision payments

unemployment. paying make work. figure people that you’re you’re Most XX% if rent, of your a to can in getting XX% way So out

that’s we it. to So anticipate don’t now long the saying, answer

Nick Joseph

terms two- relief? have for any But received delinquency those differences the you who That’s any of of seen max. reckon it’s helpful. three-months or that I only or residents in turnover been probably

Keith Oden

we No haven’t.

is the the month We seen the at or collected in encouraging there I of month-to-date it’s some collections have us had of number my are. that very fairly some July higher this guess people thing for the year-to-date have associated actually is in collections component in and remarkable we’ve point motivations what July, have month - But than Although think know, that that hard is which to we goodwill. in people’s XXXX is is, is XX%.

Nick Joseph

Thanks.

Operator

Our Malkin ahead. Go Capital from One. next question is from Neil

Neil Malkin

Are like managers? is market alluding you from coast or I’m migration is you’re your seeing into which So on from an to beautiful your more is that any exacerbated getting, dangerous? the just getting curious are ground pretty Belt anecdotally Sun dicey, the trend increase in Alex comments

Ric Campo

time in to markets the clearly coastal has move It’s to for to we very Seattle It’s going of cheap Haul and expensive start out U It’s to cheap that’s Sure, out go been and of so California rates. continued. at on leave. migration to looking long it.

California going Arizona more Texas California there’s too to U because four, expensive into or go like lease coming five to it of is it’s not them of times one to think those than of I out and out many Haul in. go to

forwarding. been forwarded. people up being Where you thing think to of But continuation postal that other a in there’s whether mail are we’ve tick your tell and I their really hard it’s The is sheltering trend. a is, markets. long-term mail forward place out watching just been just of It’s a

gets look migration years California and only last is out York increasing to you take If - there’s and for immigration. been of at - the that and out in immigration New the thing if you XX be equation the is positive,

do think they rebound continue. issue the if New if York markets, don��t do the is, as that’s guess I you I - So going I rebound. - all think to coastal City

York to have like we New it it talked think Downtown did. like Well, right. will about how was X/XX about After think come after never back, I X/XX. people

think pressure And just out. think I people will it and on going future, the the with to have empty big it deal want going to to I their after or I to people memories people out paying markets happened regulated these going think time don’t housing, It But income. that’s I and where to yes. migration with Americans going don’t drive the put long live lot think just continue. for to markets to I have of is fundamental a a unsustainable why decent has income out it when to of that I think pay highly short up place XX% that experience is that’s for more them rent change. and in do comes I and and cities just where am? migration a continue are feel think that’s to about very and it’s think to I XX% down. How are challenges affordable having I without into

Neil Malkin

Okay, great. Appreciate that I agree.

side is right given just one, terms now. and Second fruitful the It available low-cost the going debt seems in like to acquisition be and development. less of the

are deals development So going be deals, balance to particularly best probably bet it your seems that with your land sheet.

see lending talk just in are you Are seeing falling I’m participation. Thanks. like how take coming doing you to at mezz to - also the of sort with at if you end front you What or equity wondering about or that. the if preferred can you? a some deals look coming And So ever opportunities market? of land

Ric Campo

that underwrite. their anything builder So couldn’t some started pulled equity hard they underwrite or already merchant right. out or deals the today, It’s where financing see get the we to to have development shove

markets Given the uncertainty be two years. about to where going the in

started like And good. is the good so see I even though softness already development price We which be definitely feel in people longer to option. going is to some in a construction think term market

were to seeing X% we So increases. X%

down X% really is Now we’re good. flat seeing which to X% to

maybe I the know the to had of happen. that opportunities. year and those will that yet So be through we’re it’s It we market shakeout haven’t - still you see a sorry end of the have think a just hasn’t, because to some early might take little

terms getting and like pre-sales mezz things of involved in or that. In

and and any mezz that needle little. not do what I for and But you would that, of million financial crisis of We crisis you can decided assure the our just that, we our $XXX it thought We do time something structures our we simplest It the distraction day we properties needle having because effort in and move needle is just created a and go go Camden. deal forte. we financial the of have our billion flow and distractions the took too that. the out wouldn’t of the But lowered to worth going focusing through move work want types picture have think we we to in grow cleanest then those cash doesn’t our in long-term we what that of mezz or with having the that’s and and sheet shareholders products a years. to $X other the kind for had where balance not on of the people equity from issues small risk is, have over teams did risk or do a things big joint XXX% to with the enough move have our stayed we’re might business the it, like the that after ventures and our property. worth Primarily of at or to that it so about not if like about a positions really partners the structure end that. lot increase positions moves want definitely and in anything so and much mezz in have pre-sale of our and do it’s them exposure of deal

Neil Malkin

time. lot All a right. thank sense, for the guys you of Makes

Operator

is from Advisors. Pawlowski from question ahead. Our Green next John Street Go

John Pawlowski

curious economies reopening recent in as [indiscernible] some the Belt walk plans I’m and Sun weeks of kind months. back of

of you’ve larger any inflection in Houston? leasing any in or in velocity terms out noticed point notices of As move excluding July of market your maybe meaningful

Keith Oden

I leasing meaningful the virtual any what include about you period if seen Yes, that of approach XXX% say for a time. we to have pullback. through basically it’s converting - even Houston mean our I’ll think not and we went in be terms of

and gone of prior but in spiking We most to so, that to Florida. of got cases Texas in recent had and tradecraft and to down we art back particular to sort So hybrid do an the in tour also kind we our distance. in-person long they mask prospect both an leasing have wanted our that offices and socially for allow as as where model someone worse folks would the to access

that that did with we then the not and as feedback were folks our just is spiking, they from the got comfortable with So we approach.

basically to back virtual So we an went tour. appointment only

good of us And that activity variety. was so of see in you for what really July activity is most which

our and comfortable They’re in we’re a I kind at we it. are a permanently prospects to this their about that. prefer model first The XX% what it. XX% July think went our tell to of prospects way of as they fine apartments. with prospect back that folks a proficient would interestingly our week is was enough, And only preference it virtual in we with to us ask lease when

I good at be So a the for going we’re it. future part the and think it’s of mix really to

we’re think I good. So

John Pawlowski

any but XX-day on interesting move-out Okay, or up shifts across the markets exposure coming side your here?

Keith Oden

No shape. we’re good in

really at July pre-lease third quarter? August, level guidance that healthy. give so we comfort is for September. Our why to numbers is we the basically the Which got you’re looking over, are got

getting free maintain John. are while be able We on key traffic good, closer and reinitiated to numbers to I need back for said our new they the were where flat us we is lease we leases. to and have pretty XX% plus good increases percentages occupancy like earlier The was visibility a renewal to closing something to being and

John Pawlowski

Okay, last of one from like your or hit me. economies harder some in In Orlando Houston.

would those stabilized of markets you’re kind value in today discount If buyer versus for deal. levels? a a you on What pre-COVID asset kind be of on looking basis

Alex Jessett

are going just It’s And trades and a buying cap think complicated not or are going I rate the trades discount. no on. question because by that people by the pound the the there’s on,

big or at have numbers. people often in months think XXXX, you long changed snapback of underwriting I if six then rates eight cash fundamentally XXXX, the at cap end sort over a thinking There’s lasts. the And the pricing however they, down declined look call the So and flows and that the you or next XXXX, XXXX. pandemic of months look it, going times, if [indiscernible] are market pretty private people compressed market in in them, because hasn’t -

the and cap that flow. will total back rate a than grow then Houston the you’re a if project return that is discount and underwriting So flow is lower faster is there take in a cash pandemic to in increase and with cash have that to return the is that think today get or I you’ll belief before total no that, anywhere you rationale

there guess get treasury question existing a at and incredibly is you financing when capital X.X% wall assets level? of that cheap So fast buyers. look the is something on is And out and at then the to leveraged be to I going real with to me, just how there’s will investors

You’re going at returns with of cost to debt. look their equity low incredibly

development of does a next they there’s because office The they little take hard can to be loans activity to issues to is the it underwriting in lots of and really question complicated and others. side some in a have of can in couple how get will going be long The those Lenders years. others real interest investors get multi-family. I today. feel constructions are a point where [ph] more be like think lot retail to estate, it do and

to them And and and from side a for so do the think them in have acquisition in is just perspective, that’s today we’ll be to for construction opportunity increase see. where an multi-family I exposure hard but might

John Pawlowski

thanks for the Okay, so much thoughts.

Operator

Our SMBC. next ahead. Rich question is Go Anderson from from

Rich Anderson

So I guess it was taken. Tweet Chirp because was

Ric Campo

hummingbird. homage an It’s a to

Rich Anderson

in or the is, your the And regulations lesser taking individual people before ghosting you Anybody like of in how California? amount advantage it the was your a or characterize you you more the of looking underwriting terms criteria what at in impact of supply of would there’s a states credits Okay. here, view the think do thought? tenants terms longer-term in you field than number that I did signing people, why in How ask of lease? reason call of much

Keith Oden

break lowest XX% and quarter it’s our we of everything impact the range. terms most Yes, County then for the the that’s total close that. and our rents LA, is Orange our so XX% out above our collection have between, which of XX.X% portfolio XX% collections in beyond it and the XXXX, is so and in else Florida we’re California scheduled lowest in portfolio in are if where not second of you Everything even else our and Southeast is portfolio, in really collected

the But and X.X% collected break it So is an delinquent, is take plan deferred it’s truly and XX.X% between out outlier. delinquent. X.X% deferred clearly if payment and you payment you

and of we distress, a to from have written So said with forward their financial conversations how the standpoint need going a agreement the had have them path we rent whole a on the have have we delinquency. they’re means on with get that people we X.X%,

and and those think So of we with percentage the they large Maybe guess for some pay X.X%, gone don’t But their so to they don’t rent that, communicate. just pay they’re have a just part choose our dark they they can’t of not because away is time the get folks, if communicate. most it. for cannot pretty period

fees and can’t prevent that And a ground you no the way a that’s But create that. of pay, the that the prescriptions rent I evictions, direct being relief. does among is, give leaders in have from conditions creating not way, sort we standpoint by late some your But liability we’re so policy nod and rent and which wink apartment from do to relief no on truly you from of challenge the from of that political the it’s standpoint. it evicted

in circumstance policy this California. relative in crisis. imagine. a variety didn’t this pandemic to have financial it’s and that So the for of anywhere Even prescriptions is I including unique We to me think hard great

up evict may to it’s Now of pandemic who not greater particular in years? But I around, their rent, prescriptions much can’t the people have XX my personal unique view. pretty politics this ultimately, policy pay you think don’t and probably some last changed that being that’s ends the incidence

Rich Anderson

some a so and But might I being into a sort wheelhouse and to your alter And degree the strategy? permanent this know in fits I’m All to nonetheless, maybe second permanency words it But I with you Ric sure be mentioned, this then to A agree what question there kind not you already the suburbs your B on. right. putting you I’m your of and move is, already. think could condition bit mouth. of versus

conversation, see do you to change term? change the you’re in longer a believe in that you business some If systemic going systematic to pursue how

Ric Campo

it’s people or I that. thought said at cities, that They that out there markets from ballpark and I love urban will to lives. continue. to they be believe markets Everybody I people don’t do permanent coastal memories engage is cities Like don’t. shift heard They’re I fine today to have again. going - that think to I that restaurants. going do But Once continue short-term will smaller is urban markets the they’re But I want when going do issues They’re work do They end and what have and environments. the high I going earlier, not you to rise Belt or back comes the a was their Sun love If major I going are - and think know They suburban markets be don’t have going over. do love that back. pandemic those pre-pandemic. the gets from to still we they that to have to that long-term. migration day. to focusing think of just there to on to really some.

stuff. that want same governments, perspective good growth, of pro-business So start young longer from the when our high where kind workforce, we people, about low drivers great thinking is we be to term job continues weather, be, which it to

from continue definitely properties. are in We I product think suburban a mix to perspective. and urban sort invest of to going

I think that from a perspective. development

about if really bigger a that, was thinking you to are about utilize thinking the piece equation than are that be the going massively areas think home a the inside think space is and lot primarily our Camden. okay, we about work of to maybe be work how because home spaces do and the I more common it pre-pandemic We hard because from and the going from is

really minus doing home plus well. people and XXX have We or they’re from working

car life tear I don’t the one And and have I two all of got way and so my wear hours that my back, wow, people are going commutes plus hour those expenses. had

get raises in by home. work time and letting can from essence we back people their them So

because mean we’re that. all more things did our is our and one people we Zoom looking I bandwidth bandwidth. the creating were calls once if amp from spend nuts the because you So and they of up like low do more the we going at going had perspective from time a Prior in to getting properties lot pandemic things properties work just to home our environment. of user-friendly couldn’t a hit,

and amped our buildings, work to you buildings we then I bandwidth we’re we think our So up about when building going home that existing new about and from think modifying - so have component. think to

going to shift. I be a that’s big think

Rich Anderson

Appreciated. Thanks great. the right, for All color.

Operator

question Go ahead. next Our from Rich from is Hightower Evercore.

Rich Hightower

I’ll be I quick. I just understand want to sure make something here.

As far did understand XQ, that that as relief or Was do that how fit relationship? calculation part funds that? the we of collections where separated, the raised in into

Alex Jessett

it Yes, was separated.

Rich Hightower

not Okay, so included it’s collected the plus XQ. in XX% in

Alex Jessett

That is correct.

Rich Hightower

and about think nature think longer want cap on But thanks you this that? be that Ric and political the Alex of I build how do you term? the How about impact think to then guess do I people and tough values about pile rates to market and do think you risk the and It’s that. over about footprint there and to described the the lot workforce the the long-term? How Okay, checks it just California Southern boxes, for anti-California to of a you a sentiment. to and

Alex Jessett

we that. dragging issues. our we the So talking same be California New I California then mix. California to now was when think live and definitely in people market better had a and when store like and always performance California a to and it’s better California. about just and down will they I right York want that York have own, think one be struggle I New It’s portfolio going Belt our don’t better have it collections California long-term about is challenges its continue all challenges love but City its good we would start not always to everything, with that I have to in love the will people world. you is numbers But Sun economies think think has City that of our think If and in. biggest market country.

balances long diverse out mix, pandemic. way over the think So but period when about and you think, ultimately a portfolio geographically, to product I volatility time. of lower the diverse and The portfolio volatility and prior we is

we’ll York pandemic to long-term me, rent We there’s They of speaking, rent of on know moves good, fast and to rents markets. Southern a going if some will good. and government these other California California, average Houston. were the generally that continue generally and growing was pressure better to growth. is trying piling incumbents back growth our even get and was have offsetting Seattle people in those X% you’re and away, not going will control markets. you is issues. New It they’ll means slower good. I control harder tough there for to cap to you from the and that But lot be X.X%, the put better markets good To of hopefully through and our a rebuild the other They’re one competition to have the the is be out government so build still and maybe migration don’t very and and markets offset to through law not often

Rich Hightower

All right, thanks comments. for the

Operator

Kim Our Capital is ahead. from next from BMO Go question John Markets.

John Kim

a questions for popular on one-hour too Had call. guys You guidance. couple

how because on a part which are was you that new I was quarter much is, mentioned second much X.X%? kindness already the You a increase expense you was of see cancelled had clear [ph], in wondering just versus how original trending contemplated is so wanted to a that points and year-over-year you lower sequential the occupancy July provided it already was during I the basis. X% your But XX see for seeing already guidance isn’t year? of that guidance none? How know for when basis

Alex Jessett

think Yes, I you mean so if it. about

XX.X. Our XXXX was and you I for it XX.X this second quarter was morning. told it that occupancy XX.X July is

if Really is the assuming compared is fact, known. So the you to timing XXXX almost obviously third higher just expenses uptick. the driver quarter, quarter, timing at mentioned tax sequential XXXX we’re But in number effectively tax of second works remarks. the getting property When going in in the third third on the that and as at largest you as that have prepared all third and to expenses we’re a quarter. I quarter to property quarter was in typically flat my look refunds we was occupancy the of way it guidance our looked that it’s some have in that

Atlanta the of quarter we had where favorable in got XXXX. some third the Houston very impact same refunds and in also You in

The driver. driven. by So that’s large really are tax property the in drivers

John Kim

talked I to becoming term willing and But see that that’s had here potentially demand. of shorter-term that Northeast your like about you you It seems strategy. question in I this changes provide demand are guys if on you’re potentially meet up people Okay, helpful was some a in leases a of anticipate potential lot shorter strategy. higher wondering some snowbirds if to happening, contemplating winter. you if long-term

Ric Campo

premium rate we Well happens have comers demand if are at those - sure. that our though occupancy now. are it even we and that leases right meet to for really levels will all open occupancy provide And to definitely room that move We we’re high a up. to ready short-term when still levels

John Kim

Great, you. thank

Operator

from Zach Go next from Silverberg Our is Mizuho. question ahead.

Zach Silverberg

some is first students college one My city-to-city. your migration spoke peers’ of of just, of sort about from

international see travel more has markets open headwinds are to students universities you by any to if of reluctant as curious Just impacted guys sort there trend? any are this are and disproportionately potential been that

Keith Oden

Yes, that seen we nature. any of impact haven’t

of actually September going we so all around how it think Austin have, what open out, that we’re big experience level, seen how of are get less that be and years matter. we’re to how college the when, has an until a to But no. get the many where really been university important. and become probably to it’s to if still and on, shook around that, to margins, see probably remains going going university the just we a I context less of conversation the grown outside guess much that’s market over month who’s would back there’s to always the within called students could the into I much town. in-person to of it But Austin not I don’t the just actually be think

tend doesn’t a have of participation. lot portfolio to Our student

Ric Campo

Wednesday their because But And are board actually enrollment at that members is of colleges to trouble having do the is that President the combination Renu the and Houston, in-person people Just Khator. pretty that she But numbers. is their Houston of and anecdotally, us I one is told and and going her only up they’re of part up number enroll students on our board of equation of record Renu Chancellor at issues. international travel with continuing meeting that actually they’re our in that surprised the is name a of was on of to University virtual. University think

Zach Silverberg

understand that’s you, shadow what few and transactions IRR’s a maybe Got anything helpful if final market done lately. what they’re sort and But that and here. on just market right or likely targeting? in the of I the you’re seeing closed Most curios one a pre-COVID. buyers negotiated now underwriting were

Alex Jessett

So there transactions some done. been have

sort underwriting timeframes. to earnest hard, probably most said and are of I were that treasury come have some kind numbers the and have threes compressed IRRs been I now today Houston in rates few think Dallas in closed think going like that a see cap this transactions rates sort hearing and think I pre-COVID wait what cap in have that that Some are have is rates environment be and and interest more of attitude and contracts and being But in longer is that’s to to investors the definitely happened lower under When money people going tenured there you as about of and are before like. think terms the before happen. underwriting for where even it pandemic. they would than the down think of I we’re

Zach Silverberg

Got you, appreciate color all the guys.

Operator

question Kalmus from Zelman next Go ahead. Associates. Our and from Alex is

Alex Kalmus

continue some more LA pressure key give the Southeast you in performance, just color on, metrics. curios if there? called environment outside to rest expected into I’m lag could challenging recent what’s portfolio of Florida Looking some your on the of

Keith Oden

in one people scenario Southeast Southeast traffic virtual to now. less two of challenges engage just is, And Yes, right There’s propensity in a want to general. there’s in so for Florida. a Florida in

less time of little traffic have we what we normally bit would than a expect this have just - there we So year.

The just second side part operation is the on collections.

County. that of and our most would make quarter the second for behind, market Florida Southeast XX% LA, the XXXX, second it collections So were challenged Orange

something challenges that Florida. dealing definitely So those are with Southeast we’re dual in

Alex Kalmus

showings those? thank to curious you you guys your Thank you. are advantage? and [ph] approaching How Are or non-trade it, Got dynamic properties. typical there? And enabled how virtual are about those the using still you the is leasing in-person

Alex Jessett

way about up think then still using lockbox really we’re it’s you you is and with pick involves effective and a bit fob a an if and key little can have virtual. Yes, it, school it’s a you units. up Chirp and map. it using no doing the it, way you It of can from benefit Chirp definitive from certainly gates key door a pick But old where an also getting not have application as we’re clearly a can has big start And near but that that as definitive think communities effective just end open that’s access the rolled but the that out. the I the the

Alex Kalmus

good, Sounds you. thank

Operator

the closing remarks. our to Ric for This now back I conference to Campo question-and-answer. concludes like would turn over

Ric Campo

look you. future. speaking to in the forward in today participate you conference appreciate we will the We Thank you and to

lot thanks of great So a summer. rest the Have care. take a and

Operator

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

disconnect. now may You

Camden Property Trust (CPT) 1 Aug 202020 Q2 Earnings call transcript