Independence Realty Trust, Inc 8-K, filed Nov 2, 2026
Independence Realty Trust, Inc. (IRT)
About this 8-K
Independence Realty Trust, Inc filed this 8-K on November 2, 2026.
Independence Realty Trust reported third quarter 2026 EPS of $0.11 and CFFO per share of $0.29. Its Centerspace merger is expected to close as early as the end of the fourth quarter of 2026. AI summary
Items reported
- Item 2.02: Financial results
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
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(d) | Exhibits. |
99.1 | |
99.2 | |
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Independence Realty Trust, Inc. |
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November 2, 2026 | By: | /s/ James J. Sebra |
Name: | James J. Sebra |
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Title: | President and Chief Financial Officer |
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Exhibit 99.1
Independence Realty Trust Announces Third Quarter 2026 Financial Results
PHILADELPHIA – (BUSINESS WIRE) – November 2, 2026 — Independence Realty Trust, Inc. (“IRT”) (NYSE: IRT), a multifamily apartment REIT, announces its third quarter 2026 financial results.
Third Quarter 2026 EPS of $0.11 and CFFO Per Share of $0.29
Same-Store Portfolio NOI Growth of 1.6% for the Third Quarter 2026
Increases of 2.0% in Rental Revenues and 2.5% in Property Operating Expenses
Leasing Spreads Accelerated in Improved Operating Environment
Completed 1,770 Value Add Program Renovations Year-to-Date
Achieved Average ROI of 15%
Announced Acquisition of Centerspace
Creating an $8 billion Enterprise Value Apartment REIT with Approximately 44,400 Units
Reaffirmed Mid-points of Full Year 2026 Guidance for
Same-Store Revenues, Same-Store NOI and Core FFO per Share
Management Commentary
"We are pleased with our solid third quarter results, with same-store NOI growth of 1.6% and Core FFO per share of $0.29,” said Scott Schaeffer, Chairman and Chief Executive Officer. “Leasing momentum continued to build during the quarter. New lease trade-outs improved 310 basis points year over year, driving blended rent growth of 2.8%, while average occupancy held steady at 95.0% and resident retention remained healthy at 60.5%. We believe IRT is well positioned for stronger growth in 2027 as concessions burn off, our Wi-Fi program continues to ramp, and supply-demand fundamentals improve. We are also making meaningful progress on integration planning for our pending merger with Centerspace, which we believe will only build on our strength."
1
Third Quarter Summary
| • | On September 9, 2026, IRT announced that it reached a definitive agreement to merge with Centerspace, which is expected to create an $8 billion multifamily REIT focused on high growth, non-gateway markets, with 163 apartment communities and approximately 44,400 units across 17 states. Under the terms of the merger agreement, Centerspace shareholders will receive 3.800 shares of IRT common stock for each Centerspace common share. The Proposed Transaction is expected to close as early as the end of the fourth quarter of 2026, subject to approval by IRT stockholders and Centerspace shareholders on November 10, 2026, and other customary closing conditions. Upon closing, legacy IRT stockholders and holders of common units of Independence Realty Operating Partnership, LP (“IROP”) will own approximately 78% of the issued and outstanding shares of IRT common stock and IROP common units, and legacy Centerspace shareholders and holders of Centerspace, LP common units will own approximately 22% of the issued and outstanding shares of IRT common stock and IROP common units. Based on $24 million in annual synergies we expect to realize, the Proposed Transaction should be 5% accretive to CFFO. |
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| • | Net income available to common shares of $25.1 million for the quarter ended September 30, 2026 compared to $6.9 million for the quarter ended September 30, 2025. Earnings per diluted share (“EPS”) of $0.11 for the quarter ended September 30, 2026 compared to $0.03 for the quarter ended September 30, 2025. |
| • | CFFO of $70.7 million for the quarter ended September 30, 2026 compared to $70.0 million for the quarter ended September 30, 2025. CFFO per share was $0.29 for the third quarter of 2026 and for the third quarter of 2025. |
| • | Same-store portfolio NOI growth of 1.6% for the quarter ended September 30, 2026 compared to the quarter ended September 30, 2025. |
| • | Adjusted EBITDA of $95.1 million for the quarter ended September 30, 2026 compared to $92.6 million for the quarter ended September 30, 2025. |
| • | Value Add Program completed renovations of 744 units during the quarter ended September 30, 2026, achieving a weighted average return on investment during the quarter of 14.2%. |
Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other non-GAAP financial measures used herein and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP, as well as discussion of our same-store methodology.
2
Same-Store Portfolio(1) Operating Results
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| Three Months Ended |
| Nine Months Ended |
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| September 30, 2026 Compared to |
| September 30, 2026 Compared to |
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| Three Months Ended |
| Nine Months Ended |
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| September 30, 2025 |
| September 30, 2025 |
Rental and other property revenue |
| 2.0% increase |
| 1.4% increase |
Property operating expenses |
| 2.5% increase |
| 1.7% increase |
NOI |
| 1.6% increase |
| 1.3% increase |
Portfolio average occupancy |
| 40 bps decrease to 95.0% |
| 30 bps decrease to 95.1% |
Portfolio average rental rate |
| 0.6% increase to $1,605 |
| 0.6% increase to $1,599 |
NOI Margin |
| 20 bps decrease to 63.2% |
| 10 bps decrease to 62.9% |
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| Q3 2026 |
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| Q2 2026 |
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| Q3 2025 |
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| Sequential Change |
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| Year over Year Change |
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Same-Store Portfolio(1) |
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Average Occupancy |
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| 95.0 | % |
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| 95.0 | % |
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| 95.4 | % |
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| 0.0 | % |
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| (0.4 | )% |
Resident Retention Rate |
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| 60.5 | % |
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| 58.1 | % |
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| 60.2 | % |
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| 2.4 | % |
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| 0.3 | % |
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Lease Over Lease Effective Rental Rate Growth |
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Like-Term Leases |
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New |
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| (0.6 | )% |
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| (2.7 | )% |
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| (3.7 | )% |
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| 2.1 | % |
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| 3.1 | % |
Renewal |
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| 4.6 | % |
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| 4.1 | % |
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| 2.6 | % |
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| 0.5 | % |
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| 2.0 | % |
Blended |
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| 2.8 | % |
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| 1.3 | % |
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| 0.1 | % |
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| 1.5 | % |
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| 2.7 | % |
All Leases |
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New |
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| (1.9 | )% |
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| (2.0 | )% |
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| (4.1 | )% |
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| 0.1 | % |
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| 2.2 | % |
Renewal |
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| 5.1 | % |
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| 4.6 | % |
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| 2.8 | % |
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| 0.5 | % |
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| 2.3 | % |
Blended |
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| 2.1 | % |
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| 1.7 | % |
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| (0.1 | )% |
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| 0.4 | % |
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| 2.2 | % |
(1) | Same-store portfolio includes 109 properties containing 31,735 units. |
Value Add Program
We completed renovations of 744 units during the three months ended September 30, 2026, achieving a weighted average return on investment of 14.2% with an average cost per unit renovated of $20,597, and an average monthly rent increase per unit of $244 over unrenovated comparable units. We completed renovations of 1,770 units during the nine months ended September 30, 2026, achieving a weighted average return on investment of 14.9% with an average cost per unit renovated of $20,687, and an average monthly rent increase per unit of $257 over unrenovated comparable units. See the Value Add Summary page of our supplemental information for additional information on our projects' life to date as of September 30, 2026.
3
Investment Activity
Dispositions
| • | Stonebridge Crossing, Memphis, Tennessee: On September 10, 2026, we sold this property for a gross sales price of $55.8 million, resulting in a gain on sale of approximately $26.5 million. |
Joint Ventures
| • | The Mustang, Dallas, Texas: Subsequent to quarter-end, on October 1, 2026, we acquired our joint venture partner's 15% membership interest and assumed full operational control and 100% equity ownership of The Mustang property. The property underlying this joint venture is a 275-unit operating community in Dallas, Texas, that was 94% occupied with average effective monthly rent per occupied unit of $3,071 as of September 30, 2026, and will be consolidated into our financial results effective October 1, 2026. |
Capital Expenditures
Across our total portfolio for the three months ended September 30, 2026, recurring capital expenditures were $10.2 million, or $304 per unit; Value Add Program expenditures were $17.7 million; non-recurring expenditures were $11.0 million; and development expenditures were $0.1 million, respectively. For nine months ended September 30, 2026, recurring capital expenditures were $28.6 million, or $859 per unit; Value Add Program expenditures were $39.8 million; non-recurring expenditures were $29.4 million; and development expenditures were $0.3 million, respectively.
Balance Sheet and Liquidity
At September 30, 2026, our net debt to Adjusted EBITDA was 6.2x. As of the same date and including the effect of hedges, our weighted average effective interest rate on our consolidated debt was 4.3% with a weighted average maturity of 2.7 years, and 86.5% of our debt was either subject to fixed interest rates or was hedged. Also as of September 30, 2026, we had approximately $491.6 million in liquidity through a combination of unrestricted cash and cash equivalents, and capacity under our unsecured revolver.
Dividend Distribution
On September 8, 2026, our Board of Directors declared a quarterly dividend of $0.18 per share of common stock. The third quarter dividend was paid on October 23, 2026 to stockholders of record at the close of business on September 30, 2026.
4
2026 EPS, FFO and CFFO Guidance
We updated our previously issued 2026 EPS, FFO, and CFFO per share guidance as summarized below. Other than merger and integration costs incurred through September 30, 2026, our guidance does not give effect to the Proposed Transaction with Centerspace. We expect the Proposed Transaction with Centerspace to close as early as the end of the fourth quarter of 2026 and, therefore, the impact to our full year 2026 guidance is not expected to be significant. A reconciliation of our projected EPS to our projected FFO and CFFO per share is included below. See the schedules and definitions at the end of this release for further information regarding how we calculate CFFO and for management’s definition and rationale for the usefulness of CFFO.
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| Previous Guidance |
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| Current Guidance |
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| Change at Midpoint |
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2026 Full Year EPS and CFFO Guidance(1)(2) |
| Low |
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| High |
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| Low |
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| High |
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Earnings per share |
| $ | 0.22 |
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| $ | 0.27 |
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| $ | 0.18 |
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| $ | 0.20 |
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| $ | (0.05 | ) |
Adjustments: |
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Depreciation and amortization |
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| 1.06 |
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| 1.06 |
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| 1.06 |
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| 1.06 |
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| — |
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Gain on sale of real estate assets (3) |
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| (0.12 | ) |
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| (0.15 | ) |
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| (0.11 | ) |
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| (0.11 | ) |
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| 0.02 |
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FFO per share |
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| 1.16 |
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| 1.18 |
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| 1.13 |
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| 1.15 |
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| (0.03 | ) |
Merger and integration costs (4) |
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| — |
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| — |
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| 0.03 |
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| 0.03 |
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| 0.03 |
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Loan (premium accretion) discount amortization, net |
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| (0.03 | ) |
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| (0.03 | ) |
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| (0.03 | ) |
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| (0.03 | ) |
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| — |
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CFFO per share (2) |
| $ | 1.13 |
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| $ | 1.15 |
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| $ | 1.13 |
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| $ | 1.15 |
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| $ | — |
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(1) | This guidance, including the underlying assumptions presented in the 2026 Guidance Assumptions table that follows, constitutes forward-looking information. Actual full year 2026 EPS, FFO, and CFFO could vary significantly from the projections presented. See “Forward-Looking Statements”. |
| (2) | Per share guidance is based on 241.6 million weighted average shares and units outstanding, which excludes the impact of shares to be issued in conjunction with the Proposed Transaction with Centerspace. |
| (3) | Gain on sale of real estate assets includes the sale of Stonebridge Crossing, which was completed on September 10, 2026, and one property classified as held for sale as of September 30, 2026. |
(4) | Merger and integration costs incurred to date primarily consist of advisory fees, attorney fees, accountant fees, and SEC filing fees related to the Proposed Transaction with Centerspace. We expect additional merger and integration costs to be incurred during Q4 2026 in addition to severance and debt prepayment penalty related costs that are expected in conjunction with the closing of the Proposed Transaction. |
5
2026 Guidance Assumptions(1)
Our key guidance assumptions for 2026 are enumerated below. Other than merger and integration costs incurred through September 30, 2026, our guidance does not give effect to the Proposed Transaction with Centerspace, additional merger-related transaction expenses. We expect the Proposed Transaction with Centerspace to close as early as the end of the fourth quarter of 2026 and, therefore, the impact to our full year 2026 guidance is not expected to be significant. See the definitions at the end of this release for further information regarding our same-store definitions.
Same-Store Portfolio: |
| Previous 2026 Outlook: |
| Current 2026 Outlook: |
| Change at Midpoint |
Number of properties/units |
| 109 properties / 31,735 units |
| 109 properties / 31,735 units |
| — |
Property revenue growth |
| 1.5% to 1.9% |
| 1.6% to 1.8% |
| — |
Controllable operating expense growth |
| 3.3% to 3.7% |
| 3.4% to 3.8% |
| 0.1% |
Real estate tax and insurance expense growth |
| (1.0%) to (0.2%) |
| (1.0%) to (0.4%) |
| (0.1)% |
Total operating expense growth |
| 1.6% to 2.4% |
| 1.6% to 2.4% |
| — |
NOI growth |
| 1.0% to 2.0% |
| 1.2% to 1.8% |
| — |
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Corporate Expenses ($ in millions) |
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General and administrative & property management expenses |
| $55.5 - $56.5 |
| $55.5 - $56.5 |
| — |
Interest expense(2) |
| $96.5 - $97.5 |
| $97 - $98 |
| $0.5 |
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Transaction/Investment Volume(3) ($ in millions) |
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Acquisition volume |
| $145 |
| $266 |
| $117⁽³⁾ |
Disposition volume |
| $106 - $112 |
| $106 - $112 |
| — |
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Capital Expenditures ($ in millions) |
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Recurring |
| $30 - $32 |
| $31 - $33 |
| $1 |
Value add renovation program |
| $43 - $45 |
| $43 - $45 |
| — |
Non-recurring and revenue enhancing |
| $33 - $35 |
| $31 - $33 |
| ($2) |
Development |
| — |
| — |
| — |
(1) | This guidance, including the underlying assumptions, constitutes forward-looking information. Actual results could vary significantly from the projections presented. We undertake no duty to update the assumptions used in our guidance except as required by law. See “Forward-Looking Statements.” |
(2) | Interest expense includes amortization of deferred financing costs but excludes loan premium accretion, net. As a result of purchase accounting we recorded loan premiums, net, that are accreted into and reduce GAAP interest expense over the remaining term of the associated debt. However, loan premium accretion is excluded from CFFO. |
(3) | Acquisition volume reflects one property in Columbus, Ohio, acquired in Q1 and the consolidation of two properties underlying two of our joint venture investments. The consolidations of our two joint ventures were recorded on a carryover basis and occurred in Q1 and Q4. Disposition volume reflects the disposition of Stonebridge Crossing and the assumed disposition of one property classified as held for sale as of September 30, 2026. There can be no assurance that this disposition will be consummated at expected pricing levels, within expected time frames, or at all. We continue to evaluate our portfolio for capital recycling opportunities so actual acquisition and disposition volume could vary significantly from our projections. |
6
Selected Financial Information
See the schedules at the end of this earnings release for selected financial information for IRT.
Non-GAAP Financial Measures and Definitions
We disclose the following non-GAAP financial measures in this earnings release: FFO, CFFO, NOI and Adjusted EBITDA. Included at the end of this release are definitions of these non-GAAP financial measures and a reconciliation of our reported net income to our FFO and CFFO, a reconciliation of our same-store NOI to our reported net income, a reconciliation of our Adjusted EBITDA to net income, and management’s rationales for the usefulness of each of these and other non-GAAP financial measures used in this release.
Conference Call
All interested parties can listen to the live conference call webcast at 9:00 AM ET on Tuesday, November 3, 2026 from the Investors section of IRT's website, https://investors.irtliving.com. For those who are not available to listen to the live call, the replay will be available shortly afterward on following the live call from the Investors section of IRT’s website until the next earnings release.
Supplemental Information
We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store portfolio information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investors" section.
7
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE: IRT), an S&P 400 MidCap Company, is a real estate investment trust (“REIT”) that owns and operates multifamily communities across non-gateway U.S. markets. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT’s main investment objective is to provide attractive risk-adjusted returns to shareholders through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation. More information may be found on the Company’s website, www.irtliving.com.
Forward-Looking Statements
This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, but are not limited to, our earnings guidance, and the assumptions underlying such guidance, statements regarding the Proposed Transaction (as defined below) with Centerspace (as defined below), including the expected timing of closing of the Proposed Transaction, the anticipated synergies, accretion and other benefits of the Proposed Transaction and the expected ownership of the combined company, our expectations with respect to the timing and terms of sales, if any, with respect to the one property which is classified as held for sale as of September 30, 2026, our expectations with respect to projects scheduled to start in 2027 and our expectations with respect to future acquisitions and dispositions. All statements in this release that address financial and operating performance, events or developments that we expect or anticipate will occur or be achieved in the future are forward-looking statements.
Our forward-looking statements are not guarantees of future performance and involve estimates, projections, forecasts and assumptions, including as to matters that are not within our control, and are subject to risks and uncertainties including, without limitation, risks and uncertainties related to IRT’s and Centerspace’s ability to complete the Proposed Transaction on the proposed terms or on the anticipated timeline, or at all, including risks and uncertainties related to securing the necessary stockholder approvals and satisfaction of other closing conditions to consummate the transaction, the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement between Centerspace and IRT, delays in completing the Proposed Transaction involving Centerspace and IRT, the possibility that the anticipated benefits of the Proposed Transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Centerspace and IRT do business, the possibility that the Proposed Transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events, the ability of Centerspace and IRT to meet expectations regarding the timing, completion and accounting and tax treatment of the Proposed Transaction, potential adverse reactions or changes to business, customer or employee relationships, including those resulting from the announcement or completion of the Proposed Transaction, the ability to complete the Proposed Transaction and integration of Centerspace and IRT successfully, the dilution caused by IRT’s issuance of additional shares of its capital stock in connection with the Proposed Transaction, changes in market demand for rental apartment homes and pricing pressures, including from competitors, that could lead to declines in occupancy and rent levels, uncertainty and volatility in capital and credit markets, including changes that reduce availability, and increase costs, of capital, unexpected changes in our intention or ability to repay certain debt prior to maturity, increased costs on account of inflation, increased competition in the labor market, delays in the completion of, and failure to achieve anticipated benefits of, our projects with our joint venture partners, inability to sell certain assets, including those assets designated as held for sale, within the time frames or at the pricing levels expected, failure to achieve expected benefits from the redeployment of proceeds from asset sales, inability or failure to achieve anticipated benefits from future acquisitions and dispositions, delays in completing, and cost overruns incurred in connection with, our Value Add programs and failure to achieve rent increases and occupancy levels on account of the Value Add programs, unexpected impairments or impairments in excess of our estimates, new and/or increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents and fees or delay or limit our ability to evict non-paying residents, risks endemic to real estate and the real estate industry generally, the impact of potential outbreaks of infectious diseases and measures intended to prevent the spread or address the effects thereof, deteriorating economic conditions and rising unemployment rates, energy costs, and inflation, in the markets where we own apartment communities or in which we may invest in the future, uncertain global macro-economic and political conditions, the impact of actual or threatened wars or other international conflicts, such as in Ukraine, the Middle East, and South America, including sanctions imposed by the U.S. and other countries, on inflation, trade, and general economic conditions, the effects of natural and other disasters, unknown or unexpected liabilities, including the cost of legal proceedings, costs and disruptions as the result of a cybersecurity incident or other technology disruption, including but not limited to a third party's unauthorized access to our data or the data of our residents, unexpected capital needs, inability to obtain appropriate insurance coverages at reasonable rates, or at all, or losses from catastrophes in excess of our insurance coverages, and share price fluctuations. Please refer to the documents filed by us with the SEC, including specifically the “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2025, our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2026 and June 30, 2026, and the Definitive Joint Proxy Statement/Prospectus (as defined below), and our other filings with the SEC, which identify additional factors that could cause actual results to differ from those contained in forward-looking statements.
8
These forward-looking statements are based upon the beliefs and expectations of our management at the time of this release and our actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.
Important Additional Information about the Proposed Transaction and Where to Find It
In connection with the proposed merger (the “Proposed Transaction”) of Centerspace (NYSE:CSR) (“Centerspace”) and IRT, IRT filed with the SEC a registration statement on Form S-4 (File No. 333-299102) on September 24, 2026, as amended (the “Registration Statement”) which includes the joint proxy statement of Centerspace and IRT that also constitutes a prospectus of IRT. The Registration Statement was declared effective on October 7, 2026, and each of Centerspace and IRT commenced mailing of the definitive joint proxy statement of Centerspace and IRT that also constitutes a prospectus of IRT (the “Definitive Joint Proxy Statement/Prospectus”) to their respective shareholders or stockholders, as applicable, on or about October 7, 2026. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF CENTERSPACE AND IRT ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE REGISTRATION STATEMENT, THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS WHEN THEY BECOME AVAILABLE WITH THE SEC BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT CENTERSPACE, IRT, THE PROPOSED TRANSACTION AND RELATED MATTERS. Investors and security holders are able to obtain copies of the Registration Statement, the Definitive Joint Proxy Statement/Prospectus, and other relevant documents containing important information about Centerspace and IRT, free of charge from the SEC’s website at www.sec.gov and from Centerspace or IRT by requesting them by email at IRT@dfking.com. The documents filed by Centerspace with the SEC may also be obtained free of charge at Centerspace’s website at www.centerspacehomes.com or at the SEC’s website at www.sec.gov. The documents filed by IRT with the SEC may be obtained free of charge at IRT’s website at www.irtliving.com or at the SEC’s website at www.sec.gov.
Participants in Solicitation
Centerspace, IRT, and certain of their respective trustees or directors, as applicable, executive officers, and other members of management may be deemed to be participants in the solicitation of proxies from the shareholders of Centerspace and stockholders of IRT in connection with the Proposed Transaction. Information regarding the interests of the trustees or directors, as applicable, and executive officers of Centerspace and IRT and other persons who may be deemed to be participants in the solicitation of shareholders of Centerspace and IRT in connection with the Proposed Transaction and a description of their direct and indirect interests, by security holdings or otherwise, are included in the Definitive Joint Proxy Statement/Prospectus related to the Proposed Transaction. Information regarding Centerspace’s trustees and executive officers is available in its definitive proxy statement relating to its 2026 Annual Meeting of Shareholders, which was filed with the SEC on April 3, 2026 (the “2026 Centerspace Proxy Statement”), and other documents filed by Centerspace with the SEC. Information regarding IRT’s directors and executive officers is available in its definitive proxy statement relating to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on March 19, 2026 (the “2026 IRT Proxy Statement” and, together with the 2026 Centerspace Proxy Statement, the “2026 Proxy Statements”), and other documents filed by IRT with the SEC. To the extent holdings by directors or trustees, as applicable, and executive officers of Centerspace and IRT securities reported in the 2026 Proxy Statements, as applicable, have changed, such changes have been or will be reflected on Initial Statements of Beneficial Ownership on Form 3 and Statements of Change in Ownership on Forms 4 or 5 filed with the SEC by Centerspace and IRT. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, is and will be contained in the Definitive Joint Proxy Statement/Prospectus and other relevant materials filed with the SEC by Centerspace and IRT, respectively. Free copies of these documents may be obtained as described above under “Important Additional Information about the Proposed Transaction and Where to Find It.”
No Offer or Solicitation
This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
9
Schedule I
Independence Realty Trust, Inc.
Selected Financial Information
Dollars in thousands, except per share data
(unaudited)
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Selected Financial Information: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Statistics: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) available to common shares |
|
| $25,146 |
|
| $ | 3,391 |
|
| $ | (68) |
|
| $ | 33,266 |
|
| $ | 6,893 |
|
Earnings per share -- diluted |
|
| $0.11 |
|
| $ | 0.01 |
|
| $ | 0.00 |
|
| $ | 0.14 |
|
| $ | 0.03 |
|
Rental and other property revenue |
|
| $171,957 |
|
| $ | 167,126 |
|
| $ | 165,213 |
|
| $ | 166,797 |
|
| $ | 166,888 |
|
Property operating expenses |
|
| $64,340 |
|
| $ | 63,375 |
|
| $ | 62,124 |
|
| $ | 57,260 |
|
| $ | 61,699 |
|
NOI |
|
| $107,617 |
|
| $ | 103,751 |
|
| $ | 103,089 |
|
| $ | 109,537 |
|
| $ | 105,189 |
|
NOI margin |
|
| 62.6% |
|
|
| 62.1% |
|
|
| 62.4 | % |
|
| 65.7 | % |
|
| 63.0 | % |
Adjusted EBITDA |
|
| $95,124 |
|
| $ | 90,250 |
|
| $ | 86,447 |
|
| $ | 98,520 |
|
| $ | 92,643 |
|
FFO per share |
|
| $0.27 |
|
| $ | 0.28 |
|
| $ | 0.27 |
|
| $ | 0.33 |
|
| $ | 0.30 |
|
CFFO per share |
|
| $0.29 |
|
| $ | 0.28 |
|
| $ | 0.26 |
|
| $ | 0.32 |
|
| $ | 0.29 |
|
Dividends per share |
|
| $0.18 |
|
| $ | 0.18 |
|
| $ | 0.17 |
|
| $ | 0.17 |
|
| $ | 0.17 |
|
CFFO payout ratio |
|
| 62.1% |
|
|
| 64.3% |
|
|
| 65.4 | % |
|
| 53.1 | % |
|
| 58.6 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Portfolio Data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total gross assets |
|
| $7,252,643 |
|
| $ | 7,217,214 |
|
| $ | 7,167,416 |
|
| $ | 7,030,516 |
|
| $ | 7,058,026 |
|
Total number of operating properties (a) |
|
| 115 |
|
|
| 116 |
|
|
| 115 |
|
|
| 114 |
|
|
| 115 |
|
Total units (a) |
|
| 33,398 |
|
|
| 33,898 |
|
|
| 33,602 |
|
|
| 33,462 |
|
|
| 33,818 |
|
Portfolio period end occupancy (a) |
|
| 94.9% |
|
|
| 94.9 | % |
|
| 94.7 | % |
|
| 94.9 | % |
|
| 95.1 | % |
Portfolio average occupancy (a) |
|
| 94.8% |
|
|
| 94.7 | % |
|
| 94.6 | % |
|
| 94.8 | % |
|
| 94.9 | % |
Portfolio average effective monthly rent, per unit (a) |
|
| $1,610 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
Same-store portfolio (b): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period end occupancy (b) |
|
| 95.0% |
|
|
| 95.1 | % |
|
| 95.2 | % |
|
| 95.6 | % |
|
| 95.6 | % |
Average occupancy (b) |
|
| 95.0% |
|
|
| 95.0 | % |
|
| 95.3 | % |
|
| 95.4 | % |
|
| 95.4 | % |
Average effective monthly rent, per unit (b) |
|
| $1,605 |
|
| $ | 1,597 |
|
| $ | 1,594 |
|
| $ | 1,595 |
|
| $ | 1,595 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capitalization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total debt (c) |
|
| $2,401,457 |
|
| $ | 2,443,383 |
|
| $ | 2,433,543 |
|
| $ | 2,281,475 |
|
| $ | 2,296,202 |
|
Common share price, period end |
|
| $14.53 |
|
| $ | 16.69 |
|
| $ | 14.89 |
|
| $ | 17.48 |
|
| $ | 16.39 |
|
Market equity capitalization |
|
| $3,511,388 |
|
|
| $4,033,711 |
|
| $ | 3,598,014 |
|
| $ | 4,250,723 |
|
| $ | 4,016,286 |
|
Total market capitalization |
|
| $5,912,845 |
|
|
| $6,477,094 |
|
| $ | 6,031,557 |
|
| $ | 6,532,198 |
|
| $ | 6,312,488 |
|
Total debt/total gross assets |
|
| 33.1% |
|
|
| 33.9% |
|
|
| 34.0 | % |
|
| 32.5 | % |
|
| 32.5 | % |
Net debt to adjusted EBITDA (d) |
| 6.2x |
|
| 6.5x |
|
| 6.5x |
|
| 5.7x |
|
| 6.0x |
|
|||||
Interest coverage |
| 4.2x |
|
| 4.2x |
|
| 4.2x |
|
| 4.8x |
|
| 4.5x |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common shares and OP Units: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares outstanding |
|
| 235,723,073 |
|
|
| 235,742,658 |
|
|
| 235,698,008 |
|
|
| 237,234,750 |
|
|
| 239,103,283 |
|
OP units outstanding |
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
Common shares and OP units outstanding |
|
| 241,664,716 |
|
|
| 241,684,301 |
|
|
| 241,639,651 |
|
|
| 243,176,393 |
|
|
| 245,044,926 |
|
Weighted average common shares and OP units |
|
| 241,365,153 |
|
|
| 241,342,036 |
|
|
| 242,374,371 |
|
|
| 243,707,137 |
|
|
| 239,576,189 |
|
(a) | Excludes our development projects Tisdale at Lakeline Station and Flatiron Flats, as applicable. See the definitions at the end of this release. |
(b) | Same-store portfolio consists of 109 properties, which represent 31,735 units. |
(c) | Includes indebtedness associated with real estate held for sale, as applicable. |
(d) | Reflects net debt to Adjusted EBITDA, which is annualized for each period presented, including adjustments for the timing and stabilization of acquisitions and the timing of dispositions impacting quarterly EBITDA. For the five quarters ended September 30, 2026, net debt to Adjusted EBITDA excluding adjustments for timing of acquisitions and dispositions was 6.2x, 6.7x, 6.9x, 5.7x, and 6.1x, respectively. |
10
Schedule II
Independence Realty Trust, Inc.
Reconciliation of Net (Loss) Income to Funds from Operations and Core Funds From Operations
Dollars in thousands, except per share data
(unaudited)
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
| For the Three Months Ended September 30, |
|
| For the Nine Months Ended September 30, |
|
||||||||||
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
|
||||
Funds From Operations (FFO): |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Net income |
| $ | 25,719 |
|
| $ | 6,995 |
|
| $ | 29,012 |
|
| $ | 23,693 |
|
Add-Back (Deduct): |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Real estate depreciation and amortization |
|
| 65,300 |
|
|
| 61,282 |
|
|
| 193,733 |
|
|
| 178,964 |
|
Our share of real estate depreciation and amortization from investments in unconsolidated real estate entities |
|
| 886 |
|
|
| 375 |
|
|
| 2,593 |
|
|
| 1,289 |
|
(Gain on sale) loss on impairment of real estate assets, net, excluding prepayment gains |
|
| (26,474 | ) |
|
| 12,841 |
|
|
| (26,474 | ) |
|
| 12,914 |
|
Gain on sale of real estate associated with unconsolidated real estate entities |
|
| — |
|
|
| (10,389 | ) |
|
| — |
|
|
| (10,389 | ) |
FFO |
| $ | 65,431 |
|
| $ | 71,104 |
|
| $ | 198,864 |
|
| $ | 206,471 |
|
FFO per share |
| $ | 0.27 |
|
| $ | 0.30 |
|
| $ | 0.82 |
|
| $ | 0.87 |
|
CORE Funds From Operations (CFFO): |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
FFO |
| $ | 65,431 |
|
| $ | 71,104 |
|
| $ | 198,864 |
|
| $ | 206,471 |
|
Add-Back (Deduct): |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Other depreciation and amortization |
|
| 574 |
|
|
| 453 |
|
|
| 1,634 |
|
|
| 1,292 |
|
Casualty losses, net |
|
| 498 |
|
|
| 419 |
|
|
| 22 |
|
|
| 559 |
|
Loan (premium accretion) discount amortization, net |
|
| (2,018 | ) |
|
| (2,001 | ) |
|
| (6,055 | ) |
|
| (6,015 | ) |
Prepayment (gains) penalties on asset dispositions |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1,570 | ) |
Loss on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 67 |
|
Other loss |
|
| 29 |
|
|
| 12 |
|
|
| 220 |
|
|
| 115 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| 6,200 |
|
|
| — |
|
CFFO |
| $ | 70,714 |
|
| $ | 69,987 |
|
| $ | 200,885 |
|
| $ | 200,919 |
|
CFFO per share |
| $ | 0.29 |
|
| $ | 0.29 |
|
| $ | 0.83 |
|
| $ | 0.84 |
|
Weighted-average shares and units outstanding |
|
| 241,365,153 |
|
|
| 239,576,189 |
|
|
| 241,690,156 |
|
|
| 238,570,560 |
|
11
Schedule III
Independence Realty Trust, Inc.
Reconciliation of Net (Loss) Income to Same-Store Net Operating Income (a)
Dollars in thousands
(unaudited)
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
Other revenue |
|
| (152) |
|
|
| (115) |
|
|
| (109 | ) |
|
| (330 | ) |
|
| (250 | ) |
Property management expenses |
|
| 7,662 |
|
|
| 7,931 |
|
|
| 8,237 |
|
|
| 6,674 |
|
|
| 7,891 |
|
General and administrative expenses |
|
| 4,983 |
|
|
| 5,685 |
|
|
| 8,514 |
|
|
| 4,673 |
|
|
| 4,905 |
|
Depreciation and amortization expense |
|
| 65,874 |
|
|
| 64,861 |
|
|
| 64,632 |
|
|
| 62,984 |
|
|
| 61,735 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
Interest expense |
|
| 22,723 |
|
|
| 21,583 |
|
|
| 20,732 |
|
|
| 20,422 |
|
|
| 20,455 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| — |
|
|
| — |
|
|
| (17,491) |
|
|
| 12,841 |
|
Other loss |
|
| 29 |
|
|
| 105 |
|
|
| 86 |
|
|
| 238 |
|
|
| 12 |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| 836 |
|
|
| 1,047 |
|
|
| (2,403 | ) |
|
| (9,814) |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
NOI |
| $ | 107,617 |
|
| $ | 103,751 |
|
| $ | 103,089 |
|
| $ | 109,537 |
|
| $ | 105,189 |
|
Less: Non same-store portfolio NOI |
|
| 5,668 |
|
|
| 5,318 |
|
|
| 4,833 |
|
|
| 5,375 |
|
|
| 4,878 |
|
Same-store portfolio NOI |
| $ | 101,949 |
|
| $ | 98,433 |
|
| $ | 98,256 |
|
| $ | 104,162 |
|
| $ | 100,311 |
|
(a) | Same-store portfolio consists of 109 properties containing 31,735 units. |
12
Schedule IV
Independence Realty Trust, Inc.
Reconciliation of Net Income (Loss) to Adjusted EBITDA and Interest Coverage Ratio
Dollars in thousands
(unaudited)
|
| Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
| 22,723 |
|
|
| 21,583 |
|
|
| 20,732 |
|
|
| 20,422 |
|
|
| 20,455 |
|
Depreciation and amortization |
|
| 65,874 |
|
|
| 64,861 |
|
|
| 64,632 |
|
|
| 62,984 |
|
|
| 61,735 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| — |
|
|
| — |
|
|
| (17,491) |
|
|
| 12,841 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| 836 |
|
|
| 1,047 |
|
|
| (2,403 | ) |
|
| (9,814) |
|
Other loss |
|
| 29 |
|
|
| 105 |
|
|
| 86 |
|
|
| 238 |
|
|
| 12 |
|
Adjusted EBITDA |
| $ | 95,124 |
|
| $ | 90,250 |
|
| $ | 86,447 |
|
| $ | 98,520 |
|
| $ | 92,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COST: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
| $ | 22,723 |
|
| $ | 21,583 |
|
| $ | 20,732 |
|
| $ | 20,422 |
|
| $ | 20,455 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COVERAGE: |
| 4.2x |
|
| 4.2x |
|
| 4.2x |
|
| 4.8x |
|
| 4.5x |
|
|||||
|
| For the Three Months Ended September 30, |
|
| For the Nine Months Ended September 30, |
|
||||||||||
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
|
||||
Net income |
| $ | 25,719 |
|
| $ | 6,995 |
|
| $ | 29,012 |
|
| $ | 23,693 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
| 22,723 |
|
|
| 20,455 |
|
|
| 65,037 |
|
|
| 58,575 |
|
Depreciation and amortization |
|
| 65,874 |
|
|
| 61,735 |
|
|
| 195,367 |
|
|
| 180,256 |
|
Casualty losses, net |
|
| 498 |
|
|
| 419 |
|
|
| 22 |
|
|
| 559 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| 12,841 |
|
|
| (26,474) |
|
|
| 11,344 |
|
Loss on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 67 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| 6,200 |
|
|
| — |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| (9,814) |
|
|
| 2,438 |
|
|
| (8,663) |
|
Other loss |
|
| 29 |
|
|
| 12 |
|
|
| 220 |
|
|
| 115 |
|
Adjusted EBITDA |
| $ | 95,124 |
|
| $ | 92,643 |
|
| $ | 271,822 |
|
| $ | 265,946 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COST: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
| $ | 22,723 |
|
| $ | 20,455 |
|
| $ | 65,037 |
|
| $ | 58,575 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COVERAGE: |
| 4.2x |
|
| 4.5x |
|
| 4.2x |
|
| 4.5x |
|
||||
13
Schedule V
Independence Realty Trust, Inc.
Definitions
Average Effective Monthly Rent per Unit
Average effective rent per unit represents the average of net rent amounts, after concessions amortized over the life of the lease, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measurement in evaluating average pricing. This metric, when presented, reflects the average effective rent per month.
Average Occupancy
Average occupancy represents the average occupied units for the reporting period divided by the average of total units available for rent for the reporting period.
Development Property
A development property is a property that is either currently under development or is in lease-up prior to reaching overall occupancy of 90%.
EBITDA and Adjusted EBITDA
Each of EBITDA and Adjusted EBITDA is a non-GAAP financial measure. EBITDA is defined as net income before interest expense including amortization of deferred financing costs, income tax expense, and depreciation and amortization expenses. Adjusted EBITDA is EBITDA before certain other non-cash or non-operating gains or losses related to items such as merger and integration costs, loss on impairment (gain on sale) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses and income (loss) from investments in unconsolidated real estate entities. We consider each of EBITDA and Adjusted EBITDA to be an appropriate supplemental measure of performance because it eliminates interest, income taxes, depreciation and amortization, and other non-cash or non-operating gains and losses, which permits investors to view income from operations without these non-cash or non-operating items. Our calculation of Adjusted EBITDA differs from the methodology used for calculating Adjusted EBITDA by certain other REITs and, accordingly, our Adjusted EBITDA may not be comparable to Adjusted EBITDA reported by other REITs.
14
Funds From Operations (“FFO”) and Core Funds From Operations (“CFFO”)
We believe that FFO and CFFO, each of which is a non-GAAP financial measure, are additional appropriate measures of the operating performance of a REIT and us in particular. We compute FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”), as net income or loss allocated to common shares (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, loss on impairment (gain on sale) of real estate and unconsolidated real estate entities, and the cumulative effect of changes in accounting principles. While our calculation of FFO is in accordance with NAREIT’s definition, it may differ from the methodology for calculating FFO utilized by other REITs and, accordingly, may not be comparable to FFO computations of such other REITs.
CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash, non-operating gains or losses or non-recurring items related to items such as merger and integration costs, which are cash costs that we do not consider indicative of our ongoing operations, casualty (gains) losses, loan premium accretion and discount amortization and debt extinguishment costs from the determination of FFO.
Our calculation of CFFO may differ from the methodology used for calculating CFFO by other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance, management believes they are also useful to investors, because they facilitate an understanding of our operating performance after adjustment for certain non-cash, non-operating or non-recurring items that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and our operating performance between periods. Furthermore, although FFO, CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we believe that FFO and CFFO may provide us and our investors with an additional useful measure to compare our financial performance to certain other REITs. Neither FFO nor CFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Accordingly, FFO and CFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization and capital improvements. Neither FFO nor CFFO should be considered as an alternative to net income or any other GAAP measurement as an indicator of our operating performance or as an alternative to cash flow from operating, investing, and financing activities as a measure of our liquidity.
15
Interest Coverage
Interest coverage is a ratio computed by dividing Adjusted EBITDA by interest expense.
Lease Over Lease Effective Rent Growth
Lease Over Lease Effective Rent Growth represents the change in the weighted average effective monthly rental rate, including the impact of concessions, of a lease compared to the prior lease for that same unit. We report this statistic on both a like-term basis and an all leases basis. The like-term basis includes cases where both the current and prior lease associated with a unit reflect standard leasing activity and have terms of 9-14 months. An all leases basis includes all leases regardless of lease terms. We may report Lease Over Lease Effective Rent Growth for new leases, renewal leases, or blended across both new and renewal leases.
Net Debt
Net debt, a non-GAAP financial measure, equals total consolidated debt less cash and cash equivalents and loan premiums and discounts. The following table provides a reconciliation of total consolidated debt to net debt (dollars in thousands).
|
| As of |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Total debt |
| $ | 2,401,457 |
|
| $ | 2,443,383 |
|
| $ | 2,433,543 |
|
| $ | 2,281,475 |
|
| $ | 2,296,202 |
|
Less: cash and cash equivalents |
|
| (15,931) |
|
|
| (22,513) |
|
|
| (23,341 | ) |
|
| (23,564 | ) |
|
| (23,290 | ) |
Less: loan discounts and premiums, net |
|
| (15,795) |
|
|
| (17,813 | ) |
|
| (19,833 | ) |
|
| (21,850 | ) |
|
| (23,863 | ) |
Total net debt |
| $ | 2,369,731 |
|
| $ | 2,403,057 |
|
| $ | 2,390,369 |
|
| $ | 2,236,061 |
|
| $ | 2,249,049 |
|
We present net debt and net debt to Adjusted EBITDA because management believes it is a useful measure of our credit position and progress toward reducing leverage. The calculation is limited because we may not always be able to use cash to repay debt on a dollar for dollar basis.
Net Operating Income
We believe that Net Operating Income (“NOI”), a non-GAAP financial measure, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expense, depreciation and amortization, casualty related costs and gains, merger and integration costs, property management expenses, general and administrative expenses and net gains on sale of assets.
Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as a supplemental measure of our financial performance and should not be considered as an alternative to net income or any other GAAP measure.
Non Same-Store Properties and Non Same-Store Portfolio
Properties that did not meet the definition of a same-store property as of the beginning of the previous year.
Same-Store Properties and Same-Store Portfolio
We review our same-store portfolio at the beginning of each calendar year. Properties are added into the same-store portfolio if they were owned and not a development property at the beginning of the previous year. Properties that are held for sale or have been sold are excluded from the same-store portfolio.
16
Rent Premium on Value Add Renovations
The rent premium reflects the per unit per month difference between the rental rate on the renovated unit excluding the impact of upfront concessions, if any, and the market rent for an unrenovated unit as of the date presented, as determined by management consistent with its customary rent-setting and evaluation procedures. We believe excluding the impact of upfront concessions from our rental rates when comparing to the market rental rates for unrenovated units makes the comparison most relevant and the resulting premium provides management with an indicator of the increased rent generated by the unit renovation.
Renovation Costs per Unit
Renovation costs per unit includes all costs to renovate the interior units and make certain exterior renovations, including clubhouses and amenities. Interior costs per unit are based on units leased. Exterior costs per unit are based on total units at the community. Excludes overhead costs to support and manage the value add program as those costs relate to the entire program and cannot be allocated to individual projects.
Return on Investment (“ROI”) on Value Add Renovations
ROI is calculated using the Rent Premium per unit per month, multiplied by 12, divided by the interior renovation costs per unit or the total renovation costs, as applicable. We use ROI on value add renovation projects to measure the profitability of a renovation project relative to other projects or relative to other uses of our capital.
Total Gross Assets
Total Gross Assets equals total assets plus accumulated depreciation and accumulated amortization, including fully depreciated or amortized real estate and real estate related assets. The following table provides a reconciliation of total assets to total gross assets (dollars in thousands).
|
| As of |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Total assets |
| $ | 6,080,105 |
|
| $ | 6,091,687 |
|
| $ | 6,099,308 |
|
| $ | 6,021,750 |
|
| $ | 6,092,592 |
|
Plus: accumulated depreciation (a) |
|
| 1,092,563 |
|
|
| 1,045,803 |
|
|
| 989,530 |
|
|
| 932,347 |
|
|
| 890,039 |
|
Plus: accumulated amortization |
|
| 79,975 |
|
|
| 79,724 |
|
|
| 78,578 |
|
|
| 76,419 |
|
|
| 75,395 |
|
Total gross assets |
| $ | 7,252,643 |
|
| $ | 7,217,214 |
|
| $ | 7,167,416 |
|
| $ | 7,030,516 |
|
| $ | 7,058,026 |
|
(a) | Includes accumulated depreciation associated with real estate held for sale, as applicable. |
17
Exhibit 99.2
TABLE OF CONTENTS
Company Information & Forward-Looking Statements | |
|
|
Earnings Press Release | |
|
|
Financial & Operating Highlights | |
|
|
Balance Sheets | |
|
|
Statements of Operations, Funds from Operations (“FFO”) & Core FFO (“CFFO”) |
|
Trailing Five Quarters | |
Three and Nine Months Ended September 30, 2026 and 2025 | |
|
|
Adjusted EBITDA Reconciliations and Coverage Ratio |
|
Trailing Five Quarters | |
Three and Nine Months Ended September 30, 2026 and 2025 | |
|
|
Same-Store Portfolio Net Operating Income (“NOI”) and NOI Bridge |
|
Trailing Five Quarters | |
Three and Nine Months Ended September 30, 2026 and 2025 | |
|
|
Same-Store Portfolio NOI by Market |
|
Three Months Ended September 30, 2026 and 2025 | |
| Nine Months Ended September 30, 2026 and 2025 | 19 |
|
|
Property Portfolio NOI Exposure by Market | |
|
|
Value Add Summary | |
|
|
Investment & Development Activity | |
|
|
Debt Summary | |
|
|
Debt & Credit Metrics | |
|
|
Definitions |
COMPANY INFORMATION
Independence Realty Trust, Inc. (NYSE: IRT), an S&P 400 MidCap Company, is a real estate investment trust (“REIT”) that owns and operates multifamily communities across non-gateway U.S. markets. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT’s main investment objective is to provide attractive risk-adjusted returns to shareholders through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation. More information may be found on the Company’s website, www.irtliving.com.
Corporate Headquarters | 1835 Market Street, Suite 2601 |
|
| Philadelphia, PA 19103 |
|
| 267.270.4800 |
|
|
|
|
Trading Symbol on NYSE | IRT |
|
|
|
|
| Credit Ratings | Fitch Ratings | BBB l Positive |
| Standard & Poors' Ratings Services | BBB l Stable |
|
|
|
Investor Relations | Stephanie Krewson-Kelly |
|
| 267.270.4815 |
|
| SKrewson@IRTLiving.com |
|
This release and/or supplement each contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, but are not limited to, our earnings guidance, and the assumptions underlying such guidance, statements regarding the Proposed Transaction (as defined below) with Centerspace (as defined below), including the expected timing of closing of the Proposed Transaction, the anticipated synergies, accretion and other benefits of the Proposed Transaction and the expected ownership of the combined company, our expectations with respect to the timing and terms of sales, if any, with respect to the one property which is classified as held for sale as of September 30, 2026, our expectations with respect to projects scheduled to start in 2027 and our expectations with respect to future acquisitions and dispositions. All statements in this release and/or supplement that address financial and operating performance, events or developments that we expect or anticipate will occur or be achieved in the future are forward-looking statements.
1
Our forward-looking statements are not guarantees of future performance and involve estimates, projections, forecasts and assumptions, including as to matters that are not within our control, and are subject to risks and uncertainties including, without limitation, risks and uncertainties related to IRT’s and Centerspace’s ability to complete the Proposed Transaction on the proposed terms or on the anticipated timeline, or at all, including risks and uncertainties related to securing the necessary stockholder approvals and satisfaction of other closing conditions to consummate the transaction, the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement between Centerspace and IRT, delays in completing the Proposed Transaction involving Centerspace and IRT, the possibility that the anticipated benefits of the Proposed Transaction are not realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where Centerspace and IRT do business, the possibility that the Proposed Transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events, the ability of Centerspace and IRT to meet expectations regarding the timing, completion and accounting and tax treatment of the Proposed Transaction, potential adverse reactions or changes to business, customer or employee relationships, including those resulting from the announcement or completion of the Proposed Transaction, the ability to complete the Proposed Transaction and integration of Centerspace and IRT successfully, the dilution caused by IRT’s issuance of additional shares of its capital stock in connection with the Proposed Transaction, changes in market demand for rental apartment homes and pricing pressures, including from competitors, that could lead to declines in occupancy and rent levels, uncertainty and volatility in capital and credit markets, including changes that reduce availability, and increase costs, of capital, unexpected changes in our intention or ability to repay certain debt prior to maturity, increased costs on account of inflation, increased competition in the labor market, delays in the completion of, and failure to achieve anticipated benefits of, our projects with our joint venture partners, inability to sell certain assets, including those assets designated as held for sale, within the time frames or at the pricing levels expected, failure to achieve expected benefits from the redeployment of proceeds from asset sales, inability or failure to achieve anticipated benefits from future acquisitions and dispositions, delays in completing, and cost overruns incurred in connection with, our Value Add programs and failure to achieve rent increases and occupancy levels on account of the Value Add programs, unexpected impairments or impairments in excess of our estimates, new and/or increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents and fees or delay or limit our ability to evict non-paying residents, risks endemic to real estate and the real estate industry generally, the impact of potential outbreaks of infectious diseases and measures intended to prevent the spread or address the effects thereof, deteriorating economic conditions and rising unemployment rates, energy costs, and inflation, in the markets where we own apartment communities or in which we may invest in the future, uncertain global macro-economic and political conditions, the impact of actual or threatened wars or other international conflicts, such as in Ukraine, the Middle East, and South America, including sanctions imposed by the U.S. and other countries, on inflation, trade, and general economic conditions, the effects of natural and other disasters, unknown or unexpected liabilities, including the cost of legal proceedings, costs and disruptions as the result of a cybersecurity incident or other technology disruption, including but not limited to a third party's unauthorized access to our data or the data of our residents, unexpected capital needs, inability to obtain appropriate insurance coverages at reasonable rates, or at all, or losses from catastrophes in excess of our insurance coverages, and share price fluctuations. Please refer to the documents filed by us with the SEC, including specifically the “Risk Factors” sections of our Annual Report on Form 10-K for the year ended December 31, 2025, our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2026 and June 30, 2026, and the Definitive Joint Proxy Statement/Prospectus (as defined below), and our other filings with the SEC, which identify additional factors that could cause actual results to differ from those contained in forward-looking statements.
These forward-looking statements are based upon the beliefs and expectations of our management at the time of this release and supplement and our actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law.
2
Important Additional Information about the Proposed Transaction and Where to Find It
In connection with the proposed merger (the “Proposed Transaction”) of Centerspace (NYSE:CSR) (“Centerspace”) and IRT, IRT filed with the SEC a registration statement on Form S-4 (File No. 333-299102) on September 24, 2026, as amended (the “Registration Statement”) which includes the joint proxy statement of Centerspace and IRT that also constitutes a prospectus of IRT. The Registration Statement was declared effective on October 7, 2026, and each of Centerspace and IRT commenced mailing of the definitive joint proxy statement of Centerspace and IRT that also constitutes a prospectus of IRT (the “Definitive Joint Proxy Statement/Prospectus”) to their respective shareholders or stockholders, as applicable, on or about October 7, 2026. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF CENTERSPACE AND IRT ARE URGED TO READ CAREFULLY AND IN THEIR ENTIRETY THE REGISTRATION STATEMENT, THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS WHEN THEY BECOME AVAILABLE WITH THE SEC BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT CENTERSPACE, IRT, THE PROPOSED TRANSACTION AND RELATED MATTERS. Investors and security holders are able to obtain copies of the Registration Statement, the Definitive Joint Proxy Statement/Prospectus, and other relevant documents containing important information about Centerspace and IRT, free of charge from the SEC’s website at www.sec.gov and from Centerspace or IRT by requesting them by email at IRT@dfking.com. The documents filed by Centerspace with the SEC may also be obtained free of charge at Centerspace’s website at www.centerspacehomes.com or at the SEC’s website at www.sec.gov. The documents filed by IRT with the SEC may be obtained free of charge at IRT’s website at www.irtliving.com or at the SEC’s website at www.sec.gov.
Participants in Solicitation
Centerspace, IRT, and certain of their respective trustees or directors, as applicable, executive officers, and other members of management may be deemed to be participants in the solicitation of proxies from the shareholders of Centerspace and stockholders of IRT in connection with the Proposed Transaction. Information regarding the interests of the trustees or directors, as applicable, and executive officers of Centerspace and IRT and other persons who may be deemed to be participants in the solicitation of shareholders of Centerspace and IRT in connection with the Proposed Transaction and a description of their direct and indirect interests, by security holdings or otherwise, are included in the Definitive Joint Proxy Statement/Prospectus related to the Proposed Transaction. Information regarding Centerspace’s trustees and executive officers is available in its definitive proxy statement relating to its 2026 Annual Meeting of Shareholders, which was filed with the SEC on April 3, 2026 (the “2026 Centerspace Proxy Statement”), and other documents filed by Centerspace with the SEC. Information regarding IRT’s directors and executive officers is available in its definitive proxy statement relating to its 2026 Annual Meeting of Stockholders, which was filed with the SEC on March 19, 2026 (the “2026 IRT Proxy Statement” and, together with the 2026 Centerspace Proxy Statement, the “2026 Proxy Statements”), and other documents filed by IRT with the SEC. To the extent holdings by directors or trustees, as applicable, and executive officers of Centerspace and IRT securities reported in the 2026 Proxy Statements, as applicable, have changed, such changes have been or will be reflected on Initial Statements of Beneficial Ownership on Form 3 and Statements of Change in Ownership on Forms 4 or 5 filed with the SEC by Centerspace and IRT. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, is and will be contained in the Definitive Joint Proxy Statement/Prospectus and other relevant materials filed with the SEC by Centerspace and IRT, respectively. Free copies of these documents may be obtained as described above under “Important Additional Information about the Proposed Transaction and Where to Find It.”
No Offer or Solicitation
This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
3
Independence Realty Trust Announces Third Quarter 2026 Financial Results
PHILADELPHIA – (BUSINESS WIRE) – November 2, 2026 — Independence Realty Trust, Inc. (“IRT”) (NYSE: IRT), a multifamily apartment REIT, announces its third quarter 2026 financial results.
Third Quarter 2026 EPS of $0.11 and CFFO Per Share of $0.29
Same-Store Portfolio NOI Growth of 1.6% for the Third Quarter 2026
Increases of 2.0% in Rental Revenues and 2.5% in Property Operating Expenses
Leasing Spreads Accelerated in Improved Operating Environment
Completed 1,770 Value Add Program Renovations Year-to-Date
Achieved Average ROI of 15%
Announced Acquisition of Centerspace
Creating an $8 billion Enterprise Value Apartment REIT with Approximately 44,400 Units
Reaffirmed Mid-points of Full Year 2026 Guidance for
Same-Store Revenues, Same-Store NOI and Core FFO per Share
Management Commentary
"We are pleased with our solid third quarter results, with same-store NOI growth of 1.6% and Core FFO per share of $0.29,” said Scott Schaeffer, Chairman and Chief Executive Officer. “Leasing momentum continued to build during the quarter. New lease trade-outs improved 310 basis points year over year, driving blended rent growth of 2.8%, while average occupancy held steady at 95.0% and resident retention remained healthy at 60.5%. We believe IRT is well positioned for stronger growth in 2027 as concessions burn off, our Wi-Fi program continues to ramp, and supply-demand fundamentals improve. We are also making meaningful progress on integration planning for our pending merger with Centerspace, which we believe will only build on our strength."
4
Third Quarter Summary
| • | On September 9, 2026, IRT announced that it reached a definitive agreement to merge with Centerspace, which is expected to create an $8 billion multifamily REIT focused on high growth, non-gateway markets, with 163 apartment communities and approximately 44,400 units across 17 states. Under the terms of the merger agreement, Centerspace shareholders will receive 3.800 shares of IRT common stock for each Centerspace common share. The Proposed Transaction is expected to close as early as the end of the fourth quarter of 2026, subject to approval by IRT stockholders and Centerspace shareholders on November 10, 2026, and other customary closing conditions. Upon closing, legacy IRT stockholders and holders of common units of Independence Realty Operating Partnership, LP (“IROP”) will own approximately 78% of the issued and outstanding shares of IRT common stock and IROP common units, and legacy Centerspace shareholders and holders of Centerspace, LP common units will own approximately 22% of the issued and outstanding shares of IRT common stock and IROP common units. Based on $24 million in annual synergies we expect to realize, the Proposed Transaction should be 5% accretive to CFFO. |
| • | Net income available to common shares of $25.1 million for the quarter ended September 30, 2026 compared to $6.9 million for the quarter ended September 30, 2025. Earnings per diluted share (“EPS”) of $0.11 for the quarter ended September 30, 2026 compared to $0.03 for the quarter ended September 30, 2025. |
| • | CFFO of $70.7 million for the quarter ended September 30, 2026 compared to $70.0 million for the quarter ended September 30, 2025. CFFO per share was $0.29 for the third quarter of 2026 and for the third quarter of 2025. |
| • | Same-store portfolio NOI growth of 1.6% for the quarter ended September 30, 2026 compared to the quarter ended September 30, 2025. |
| • | Adjusted EBITDA of $95.1 million for the quarter ended September 30, 2026 compared to $92.6 million for the quarter ended September 30, 2025. |
| • | Value Add Program completed renovations of 744 units during the quarter ended September 30, 2026, achieving a weighted average return on investment during the quarter of 14.2%. |
Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other non-GAAP financial measures used herein and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP, as well as discussion of our same-store methodology.
5
Same-Store Portfolio(1) Operating Results
|
| Three Months Ended |
| Nine Months Ended |
|
| September 30, 2026 Compared to |
| September 30, 2026 Compared to |
|
| Three Months Ended |
| Nine Months Ended |
|
| September 30, 2025 |
| September 30, 2025 |
Rental and other property revenue |
| 2.0% increase |
| 1.4% increase |
Property operating expenses |
| 2.5% increase |
| 1.7% increase |
NOI |
| 1.6% increase |
| 1.3% increase |
Portfolio average occupancy |
| 40 bps decrease to 95.0% |
| 30 bps decrease to 95.1% |
Portfolio average rental rate |
| 0.6% increase to $1,605 |
| 0.6% increase to $1,599 |
NOI Margin |
| 20 bps decrease to 63.2% |
| 10 bps decrease to 62.9% |
|
| Q3 2026 |
|
| Q2 2026 |
|
| Q3 2025 |
|
| Sequential Change |
|
| Year over Year Change |
|
|||||
Same-Store Portfolio(1) |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Average Occupancy |
|
| 95.0 | % |
|
| 95.0 | % |
|
| 95.4 | % |
|
| 0.0 | % |
|
| (0.4 | )% |
Resident Retention Rate |
|
| 60.5 | % |
|
| 58.1 | % |
|
| 60.2 | % |
|
| 2.4 | % |
|
| 0.3 | % |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Lease Over Lease Effective Rental Rate Growth |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Like-Term Leases |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
New |
|
| (0.6 | )% |
|
| (2.7 | )% |
|
| (3.7 | )% |
|
| 2.1 | % |
|
| 3.1 | % |
Renewal |
|
| 4.6 | % |
|
| 4.1 | % |
|
| 2.6 | % |
|
| 0.5 | % |
|
| 2.0 | % |
Blended |
|
| 2.8 | % |
|
| 1.3 | % |
|
| 0.1 | % |
|
| 1.5 | % |
|
| 2.7 | % |
All Leases |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
New |
|
| (1.9 | )% |
|
| (2.0 | )% |
|
| (4.1 | )% |
|
| 0.1 | % |
|
| 2.2 | % |
Renewal |
|
| 5.1 | % |
|
| 4.6 | % |
|
| 2.8 | % |
|
| 0.5 | % |
|
| 2.3 | % |
Blended |
|
| 2.1 | % |
|
| 1.7 | % |
|
| (0.1 | )% |
|
| 0.4 | % |
|
| 2.2 | % |
(1) | Same-store portfolio includes 109 properties containing 31,735 units. |
Value Add Program
We completed renovations of 744 units during the three months ended September 30, 2026, achieving a weighted average return on investment of 14.2% with an average cost per unit renovated of $20,597, and an average monthly rent increase per unit of $244 over unrenovated comparable units. We completed renovations of 1,770 units during the nine months ended September 30, 2026, achieving a weighted average return on investment of 14.9% with an average cost per unit renovated of $20,687, and an average monthly rent increase per unit of $257 over unrenovated comparable units. See the Value Add Summary page of our supplemental information for additional information on our projects' life to date as of September 30, 2026.
6
Investment Activity
Dispositions
| • | Stonebridge Crossing, Memphis, Tennessee: On September 10, 2026, we sold this property for a gross sales price of $55.8 million, resulting in a gain on sale of approximately $26.5 million. |
Joint Ventures
| • | The Mustang, Dallas, Texas: Subsequent to quarter-end, on October 1, 2026, we acquired our joint venture partner's 15% membership interest and assumed full operational control and 100% equity ownership of The Mustang property. The property underlying this joint venture is a 275-unit operating community in Dallas, Texas, that was 94% occupied with average effective monthly rent per occupied unit of $3,071 as of September 30, 2026, and will be consolidated into our financial results effective October 1, 2026. |
Capital Expenditures
Across our total portfolio for the three months ended September 30, 2026, recurring capital expenditures were $10.2 million, or $304 per unit; Value Add Program expenditures were $17.7 million; non-recurring expenditures were $11.0 million; and development expenditures were $0.1 million, respectively. For nine months ended September 30, 2026, recurring capital expenditures were $28.6 million, or $859 per unit; Value Add Program expenditures were $39.8 million; non-recurring expenditures were $29.4 million; and development expenditures were $0.3 million, respectively.
7
Balance Sheet and Liquidity
At September 30, 2026, our net debt to Adjusted EBITDA was 6.2x. As of the same date and including the effect of hedges, our weighted average effective interest rate on our consolidated debt was 4.3% with a weighted average maturity of 2.7 years, and 86.5% of our debt was either subject to fixed interest rates or was hedged. Also as of September 30, 2026, we had approximately $491.6 million in liquidity through a combination of unrestricted cash and cash equivalents, and capacity under our unsecured revolver.
Dividend Distribution
On September 8, 2026, our Board of Directors declared a quarterly dividend of $0.18 per share of common stock. The third quarter dividend was paid on October 23, 2026 to stockholders of record at the close of business on September 30, 2026.
2026 EPS, FFO and CFFO Guidance
We updated our previously issued 2026 EPS, FFO, and CFFO per share guidance as summarized below. Other than merger and integration costs incurred through September 30, 2026, our guidance does not give effect to the Proposed Transaction with Centerspace. We expect the Proposed Transaction with Centerspace to close as early as the end of the fourth quarter of 2026 and, therefore, the impact to our full year 2026 guidance is not expected to be significant. A reconciliation of our projected EPS to our projected FFO and CFFO per share is included below. See the schedules and definitions at the end of this release for further information regarding how we calculate CFFO and for management’s definition and rationale for the usefulness of CFFO.
|
| Previous Guidance |
|
| Current Guidance |
|
| Change at Midpoint |
|
|||||||||||
2026 Full Year EPS and CFFO Guidance(1)(2) |
| Low |
|
| High |
|
| Low |
|
| High |
|
|
|
| |
||||
Earnings per share |
| $ | 0.22 |
|
| $ | 0.27 |
|
| $ | 0.18 |
|
| $ | 0.20 |
|
| $ | (0.05 | ) |
Adjustments: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Depreciation and amortization |
|
| 1.06 |
|
|
| 1.06 |
|
|
| 1.06 |
|
|
| 1.06 |
|
|
| — |
|
Gain on sale of real estate assets (3) |
|
| (0.12 | ) |
|
| (0.15 | ) |
|
| (0.11 | ) |
|
| (0.11 | ) |
|
| 0.02 |
|
FFO per share |
|
| 1.16 |
|
|
| 1.18 |
|
|
| 1.13 |
|
|
| 1.15 |
|
|
| (0.03 | ) |
Merger and integration costs (4) |
|
| — |
|
|
| — |
|
|
| 0.03 |
|
|
| 0.03 |
|
|
| 0.03 |
|
Loan (premium accretion) discount amortization, net |
|
| (0.03 | ) |
|
| (0.03 | ) |
|
| (0.03 | ) |
|
| (0.03 | ) |
|
| — |
|
CFFO per share (2) |
| $ | 1.13 |
|
| $ | 1.15 |
|
| $ | 1.13 |
|
| $ | 1.15 |
|
| $ | — |
|
(1)
|
This guidance, including the underlying assumptions presented in the 2026 Guidance Assumptions table that follows, constitutes forward-looking information. Actual full year 2026 EPS, FFO, and CFFO could vary significantly from the projections presented. See “Forward-Looking Statements”. |
|
(2) | Per share guidance is based on 241.6 million weighted average shares and units outstanding, which excludes the impact of shares to be issued in conjunction with the Proposed Transaction with Centerspace. |
|
(3) |
Gain on sale of real estate assets includes the sale of Stonebridge Crossing, which was completed on September 10, 2026, and one property classified as held for sale as of September 30, 2026. |
(4) | Merger and integration costs incurred to date primarily consist of advisory fees, attorney fees, accountant fees, and SEC filing fees related to the Proposed Transaction with Centerspace. We expect additional merger and integration costs to be incurred during Q4 2026 in addition to severance and debt prepayment penalty related costs that are expected in conjunction with the closing of the Proposed Transaction. |
8
2026 Guidance Assumptions(1)
Our key guidance assumptions for 2026 are enumerated below. Other than merger and integration costs incurred through September 30, 2026, our guidance does not give effect to the Proposed Transaction with Centerspace, additional merger-related transaction expenses. We expect the Proposed Transaction with Centerspace to close as early as the end of the fourth quarter of 2026 and, therefore, the impact to our full year 2026 guidance is not expected to be significant. See the definitions at the end of this release for further information regarding our same-store definitions.
Same-Store Portfolio: |
| Previous 2026 Outlook: |
| Current 2026 Outlook: |
| Change at Midpoint |
Number of properties/units |
| 109 properties / 31,735 units |
| 109 properties / 31,735 units |
| — |
Property revenue growth |
| 1.5% to 1.9% |
| 1.6% to 1.8% |
| — |
Controllable operating expense growth |
| 3.3% to 3.7% |
| 3.4% to 3.8% |
| 0.1% |
Real estate tax and insurance expense growth |
| (1.0%) to (0.2%) |
| (1.0%) to (0.4%) |
| (0.1)% |
Total operating expense growth |
| 1.6% to 2.4% |
| 1.6% to 2.4% |
| — |
NOI growth |
| 1.0% to 2.0% |
| 1.2% to 1.8% |
| — |
|
|
|
|
|
|
|
Corporate Expenses ($ in millions) |
|
|
|
|
|
|
General and administrative & property management expenses |
| $55.5 - $56.5 |
| $55.5 - $56.5 |
| — |
Interest expense(2) |
| $96.5 - $97.5 |
| $97 - $98 |
| $0.5 |
|
|
|
|
|
|
|
Transaction/Investment Volume(3) ($ in millions) |
|
|
|
|
|
|
Acquisition volume |
| $145 |
| $266 |
| $117⁽³⁾ |
Disposition volume |
| $106 - $112 |
| $106 - $112 |
| — |
|
|
|
|
|
|
|
Capital Expenditures ($ in millions) |
|
|
|
|
|
|
Recurring |
| $30 - $32 |
| $31 - $33 |
| $1 |
Value add renovation program |
| $43 - $45 |
| $43 - $45 |
| — |
Non-recurring and revenue enhancing |
| $33 - $35 |
| $31 - $33 |
| ($2) |
Development |
| — |
| — |
| — |
(1) | This guidance, including the underlying assumptions, constitutes forward-looking information. Actual results could vary significantly from the projections presented. We undertake no duty to update the assumptions used in our guidance except as required by law. See “Forward-Looking Statements.” |
(2) | Interest expense includes amortization of deferred financing costs but excludes loan premium accretion, net. As a result of purchase accounting we recorded loan premiums, net, that are accreted into and reduce GAAP interest expense over the remaining term of the associated debt. However, loan premium accretion is excluded from CFFO. |
(3) | Acquisition volume reflects one property in Columbus, Ohio, acquired in Q1 and the consolidation of two properties underlying two of our joint venture investments. The consolidations of our two joint ventures were recorded on a carryover basis and occurred in Q1 and Q4. Disposition volume reflects the disposition of Stonebridge Crossing and the assumed disposition of one property classified as held for sale as of September 30, 2026. There can be no assurance that this disposition will be consummated at expected pricing levels, within expected time frames, or at all. We continue to evaluate our portfolio for capital recycling opportunities so actual acquisition and disposition volume could vary significantly from our projections. |
9
Selected Financial Information
See the schedules at the end of this earnings release for selected financial information for IRT.
Non-GAAP Financial Measures and Definitions
We disclose the following non-GAAP financial measures in this earnings release: FFO, CFFO, NOI and Adjusted EBITDA. Included at the end of this release are definitions of these non-GAAP financial measures and a reconciliation of our reported net income to our FFO and CFFO, a reconciliation of our same-store NOI to our reported net income, a reconciliation of our Adjusted EBITDA to net income, and management’s rationales for the usefulness of each of these and other non-GAAP financial measures used in this release.
Conference Call
All interested parties can listen to the live conference call webcast at 9:00 AM ET on Tuesday, November 3, 2026 from the Investors section of IRT's website, https://investors.irtliving.com. For those who are not available to listen to the live call, the replay will be available shortly afterward on following the live call from the Investors section of IRT’s website until the next earnings release.
Supplemental Information
We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store portfolio information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investors" section.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE: IRT), an S&P 400 MidCap Company, is a real estate investment trust (“REIT”) that owns and operates multifamily communities across non-gateway U.S. markets. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT’s main investment objective is to provide attractive risk-adjusted returns to shareholders through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation. More information may be found on the Company’s website, www.irtliving.com.
10
FINANCIAL & OPERATING HIGHLIGHTS
Dollars in thousands, except per share data
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Selected Financial Information: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Operating Statistics: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Net income (loss) available to common shares |
| $ | 25,146 |
|
| $ | 3,391 |
|
| $ | (68 | ) |
| $ | 33,266 |
|
| $ | 6,893 |
|
Earnings per share -- diluted |
| $ | 0.11 |
|
| $ | 0.01 |
|
| $ | 0.00 |
|
| $ | 0.14 |
|
| $ | 0.03 |
|
Rental and other property revenue |
| $ | 171,957 |
|
| $ | 167,126 |
|
| $ | 165,213 |
|
| $ | 166,797 |
|
| $ | 166,888 |
|
Property operating expenses |
| $ | 64,340 |
|
| $ | 63,375 |
|
| $ | 62,124 |
|
| $ | 57,260 |
|
| $ | 61,699 |
|
NOI |
| $ | 107,617 |
|
| $ | 103,751 |
|
| $ | 103,089 |
|
| $ | 109,537 |
|
| $ | 105,189 |
|
NOI margin |
|
| 62.6 | % |
|
| 62.1 | % |
|
| 62.4 | % |
|
| 65.7 | % |
|
| 63.0 | % |
Adjusted EBITDA |
| $ | 95,124 |
|
| $ | 90,250 |
|
| $ | 86,447 |
|
| $ | 98,520 |
|
| $ | 92,643 |
|
FFO per share |
| $ | 0.27 |
|
| $ | 0.28 |
|
| $ | 0.27 |
|
| $ | 0.33 |
|
| $ | 0.30 |
|
CFFO per share |
| $ | 0.29 |
|
| $ | 0.28 |
|
| $ | 0.26 |
|
| $ | 0.32 |
|
| $ | 0.29 |
|
Dividends per share |
| $ | 0.18 |
|
| $ | 0.18 |
|
| $ | 0.17 |
|
| $ | 0.17 |
|
| $ | 0.17 |
|
CFFO payout ratio |
|
| 62.1 | % |
|
| 64.3 | % |
|
| 65.4 | % |
|
| 53.1 | % |
|
| 58.6 | % |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Portfolio Data: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Total gross assets |
| $ | 7,252,643 |
|
| $ | 7,217,214 |
|
| $ | 7,167,416 |
|
| $ | 7,030,516 |
|
| $ | 7,058,026 |
|
Total number of operating properties (a) |
|
| 115 |
|
|
| 116 |
|
|
| 115 |
|
|
| 114 |
|
|
| 115 |
|
Total units (a) |
|
| 33,398 |
|
|
| 33,898 |
|
|
| 33,602 |
|
|
| 33,462 |
|
|
| 33,818 |
|
Portfolio period end occupancy (a) |
|
| 94.9 | % |
|
| 94.9 | % |
|
| 94.7 | % |
|
| 94.9 | % |
|
| 95.1 | % |
Portfolio average occupancy (a) |
|
| 94.8 | % |
|
| 94.7 | % |
|
| 94.6 | % |
|
| 94.8 | % |
|
| 94.9 | % |
Portfolio average effective monthly rent, per unit (a) |
| $ | 1,610 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
| $ | 1,593 |
|
Same-store portfolio (b): |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Period end occupancy (b) |
|
| 95.0 | % |
|
| 95.1 | % |
|
| 95.2 | % |
|
| 95.6 | % |
|
| 95.6 | % |
Average occupancy (b) |
|
| 95.0 | % |
|
| 95.0 | % |
|
| 95.3 | % |
|
| 95.4 | % |
|
| 95.4 | % |
Average effective monthly rent, per unit (b) |
| $ | 1,605 |
|
| $ | 1,597 |
|
| $ | 1,594 |
|
| $ | 1,595 |
|
| $ | 1,595 |
|
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Capitalization: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Total debt (c) |
| $ | 2,401,457 |
|
| $ | 2,443,383 |
|
| $ | 2,433,543 |
|
| $ | 2,281,475 |
|
| $ | 2,296,202 |
|
Common share price, period end |
| $ | 14.53 |
|
| $ | 16.69 |
|
| $ | 14.89 |
|
| $ | 17.48 |
|
| $ | 16.39 |
|
Market equity capitalization |
| $ | 3,511,388 |
|
| $ | 4,033,711 |
|
| $ | 3,598,014 |
|
| $ | 4,250,723 |
|
| $ | 4,016,286 |
|
Total market capitalization |
| $ | 5,912,845 |
|
| $ | 6,477,094 |
|
| $ | 6,031,557 |
|
| $ | 6,532,198 |
|
| $ | 6,312,488 |
|
Total debt/total gross assets |
|
| 33.1 | % |
|
| 33.9 | % |
|
| 34.0 | % |
|
| 32.5 | % |
|
| 32.5 | % |
Net debt to adjusted EBITDA (d) |
| 6.2x |
|
| 6.5x |
|
| 6.5x |
|
| 5.7x |
|
| 6.0x |
|
|||||
Interest coverage |
| 4.2x |
|
| 4.2x |
|
| 4.2x |
|
| 4.8x |
|
| 4.5x |
|
|||||
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Common shares and OP Units: |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Shares outstanding |
|
| 235,723,073 |
|
|
| 235,742,658 |
|
|
| 235,698,008 |
|
|
| 237,234,750 |
|
|
| 239,103,283 |
|
OP units outstanding |
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
|
| 5,941,643 |
|
Common shares and OP units outstanding |
|
| 241,664,716 |
|
|
| 241,684,301 |
|
|
| 241,639,651 |
|
|
| 243,176,393 |
|
|
| 245,044,926 |
|
Weighted average common shares and OP units |
|
| 241,365,153 |
|
|
| 241,342,036 |
|
|
| 242,374,371 |
|
|
| 243,707,137 |
|
|
| 239,576,189 |
|
(a) | Excludes our development projects Tisdale at Lakeline Station and Flatiron Flats, as applicable. See the definitions at the end of this release. |
(b) | Same-store portfolio consists of 109 properties, which represent 31,735 units. |
(c) | Includes indebtedness associated with real estate held for sale, as applicable. |
(d) | Reflects net debt to Adjusted EBITDA, which is annualized for each period presented, including adjustments for the timing and stabilization of acquisitions and the timing of dispositions impacting quarterly EBITDA. For the five quarters ended September 30, 2026, net debt to Adjusted EBITDA excluding adjustments for timing of acquisitions and dispositions was 6.2x, 6.7x, 6.9x, 5.7x, and 6.1x, respectively. |
11
Dollars in thousands, except per share data
|
| As of |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate held for investment, at cost |
| $ | 6,843,728 |
|
| $ | 6,798,220 |
|
| $ | 6,700,142 |
|
| $ | 6,596,007 |
|
| $ | 6,571,161 |
|
Less: accumulated depreciation |
|
| (1,085,397) |
|
|
| (1,029,116) |
|
|
| (972,660 | ) |
|
| (915,247 | ) |
|
| (861,370 | ) |
Real estate held for investment, net |
|
| 5,758,331 |
|
|
| 5,769,104 |
|
|
| 5,727,482 |
|
|
| 5,680,760 |
|
|
| 5,709,791 |
|
Real estate held for sale |
|
| 50,012 |
|
|
| 77,756 |
|
|
| 76,858 |
|
|
| 76,468 |
|
|
| 107,182 |
|
Real estate under development |
|
| 59,230 |
|
|
| 67,814 |
|
|
| 127,840 |
|
|
| 60,116 |
|
|
| 65,628 |
|
Cash and cash equivalents |
|
| 15,931 |
|
|
| 22,513 |
|
|
| 23,341 |
|
|
| 23,564 |
|
|
| 23,290 |
|
Restricted cash |
|
| 27,375 |
|
|
| 24,184 |
|
|
| 19,926 |
|
|
| 24,058 |
|
|
| 27,639 |
|
Investment in unconsolidated real estate entities |
|
| 77,790 |
|
|
| 69,970 |
|
|
| 66,560 |
|
|
| 98,263 |
|
|
| 93,965 |
|
Other assets |
|
| 67,505 |
|
|
| 45,078 |
|
|
| 44,151 |
|
|
| 45,711 |
|
|
| 47,771 |
|
Derivative assets |
|
| 23,764 |
|
|
| 14,850 |
|
|
| 11,586 |
|
|
| 9,840 |
|
|
| 11,873 |
|
Intangible assets, net |
|
| 167 |
|
|
| 418 |
|
|
| 1,564 |
|
|
| 2,970 |
|
|
| 5,453 |
|
Total assets |
| $ | 6,080,105 |
|
| $ | 6,091,687 |
|
| $ | 6,099,308 |
|
| $ | 6,021,750 |
|
| $ | 6,092,592 |
|
Liabilities and Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Indebtedness, net (a) |
| $ | 2,401,457 |
|
| $ | 2,443,383 |
|
| $ | 2,433,543 |
|
| $ | 2,281,475 |
|
| $ | 2,296,202 |
|
Accounts payable and accrued expenses |
|
| 139,099 |
|
|
| 101,713 |
|
|
| 84,160 |
|
|
| 92,355 |
|
|
| 119,513 |
|
Accrued interest payable |
|
| 10,297 |
|
|
| 8,296 |
|
|
| 10,642 |
|
|
| 8,377 |
|
|
| 10,265 |
|
Dividends payable |
|
| 43,427 |
|
|
| 43,426 |
|
|
| 41,003 |
|
|
| 41,275 |
|
|
| 41,592 |
|
Derivative liabilities |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 346 |
|
|
| 737 |
|
Other liabilities |
|
| 7,197 |
|
|
| 8,178 |
|
|
| 8,318 |
|
|
| 8,496 |
|
|
| 9,023 |
|
Total liabilities |
|
| 2,601,477 |
|
|
| 2,604,996 |
|
|
| 2,577,666 |
|
|
| 2,432,324 |
|
|
| 2,477,332 |
|
Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred shares, $0.01 par value per share |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Common shares, $0.01 par value per share |
|
| 2,357 |
|
|
| 2,357 |
|
|
| 2,357 |
|
|
| 2,372 |
|
|
| 2,391 |
|
Additional paid in capital |
|
| 3,978,635 |
|
|
| 3,978,126 |
|
|
| 3,976,536 |
|
|
| 4,005,168 |
|
|
| 4,022,309 |
|
Accumulated other comprehensive income |
|
| 22,298 |
|
|
| 13,384 |
|
|
| 9,982 |
|
|
| 7,722 |
|
|
| 9,095 |
|
Accumulated deficit |
|
| (651,912) |
|
|
| (634,698) |
|
|
| (595,712 | ) |
|
| (555,326 | ) |
|
| (548,319 | ) |
Total shareholders' equity |
|
| 3,351,378 |
|
|
| 3,359,169 |
|
|
| 3,393,163 |
|
|
| 3,459,936 |
|
|
| 3,485,476 |
|
Noncontrolling Interests |
|
| 127,250 |
|
|
| 127,522 |
|
|
| 128,479 |
|
|
| 129,490 |
|
|
| 129,784 |
|
Total equity |
|
| 3,478,628 |
|
|
| 3,486,691 |
|
|
| 3,521,642 |
|
|
| 3,589,426 |
|
|
| 3,615,260 |
|
Total liabilities and equity |
| $ | 6,080,105 |
|
| $ | 6,091,687 |
|
| $ | 6,099,308 |
|
| $ | 6,021,750 |
|
| $ | 6,092,592 |
|
| (a) | Includes indebtedness associated with real estate held for sale, as applicable. |
12
STATEMENTS OF OPERATIONS, FFO & CFFO
TRAILING FIVE QUARTERS
(Dollars in thousands, except per share data)
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental and other property revenue |
| $ | 171,957 |
|
| $ | 167,126 |
|
| $ | 165,213 |
|
| $ | 166,797 |
|
| $ | 166,888 |
|
Other revenue |
|
| 152 |
|
|
| 115 |
|
|
| 109 |
|
|
| 330 |
|
|
| 250 |
|
Total revenue |
|
| 172,109 |
|
|
| 167,241 |
|
|
| 165,322 |
|
|
| 167,127 |
|
|
| 167,138 |
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property operating expenses |
|
| 64,340 |
|
|
| 63,375 |
|
|
| 62,124 |
|
|
| 57,260 |
|
|
| 61,699 |
|
Property management expenses |
|
| 7,662 |
|
|
| 7,931 |
|
|
| 8,237 |
|
|
| 6,674 |
|
|
| 7,891 |
|
General and administrative expenses (a) |
|
| 4,983 |
|
|
| 5,685 |
|
|
| 8,514 |
|
|
| 4,673 |
|
|
| 4,905 |
|
Depreciation and amortization expense |
|
| 65,874 |
|
|
| 64,861 |
|
|
| 64,632 |
|
|
| 62,984 |
|
|
| 61,735 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
Total expenses |
|
| 143,357 |
|
|
| 141,299 |
|
|
| 143,584 |
|
|
| 132,346 |
|
|
| 136,649 |
|
Interest expense |
|
| (22,723) |
|
|
| (21,583) |
|
|
| (20,732 | ) |
|
| (20,422 | ) |
|
| (20,455 | ) |
Gain on sale (loss on impairment) of real estate assets, net |
|
| 26,474 |
|
|
| — |
|
|
| — |
|
|
| 17,491 |
|
|
| (12,841) |
|
Other loss |
|
| (29) |
|
|
| (105) |
|
|
| (86) |
|
|
| (238) |
|
|
| (12) |
|
(Loss) income from investments in unconsolidated real estate entities |
|
| (555) |
|
|
| (836) |
|
|
| (1,047) |
|
|
| 2,403 |
|
|
| 9,814 |
|
Merger and integration costs |
|
| (6,200) |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
(Income) loss allocated to noncontrolling interests |
|
| (573) |
|
|
| (27) |
|
|
| 59 |
|
|
| (749 | ) |
|
| (102 | ) |
Net income (loss) available to common shares |
| $ | 25,146 |
|
| $ | 3,391 |
|
| $ | (68) |
|
| $ | 33,266 |
|
| $ | 6,893 |
|
Earnings per share - basic |
| $ | 0.11 |
|
| $ | 0.01 |
|
| $ | 0.00 |
|
| $ | 0.14 |
|
| $ | 0.03 |
|
Weighted-average shares outstanding - Basic |
|
| 235,423,510 |
|
|
| 235,400,393 |
|
|
| 236,432,728 |
|
|
| 237,765,494 |
|
|
| 233,634,546 |
|
Earnings per share - diluted |
| $ | 0.11 |
|
| $ | 0.01 |
|
| $ | 0.00 |
|
| $ | 0.14 |
|
| $ | 0.03 |
|
Weighted-average shares outstanding - Diluted |
|
| 236,113,360 |
|
|
| 236,037,395 |
|
|
| 236,432,728 |
|
|
| 238,495,087 |
|
|
| 234,283,170 |
|
Funds From Operations (FFO): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate depreciation and amortization |
|
| 65,300 |
|
|
| 64,319 |
|
|
| 64,114 |
|
|
| 62,497 |
|
|
| 61,282 |
|
Our share of real estate depreciation and amortization from investments in unconsolidated real estate entities |
|
| 886 |
|
|
| 831 |
|
|
| 876 |
|
|
| 609 |
|
|
| 375 |
|
(Gain on sale) loss on impairment of real estate assets, net, excluding prepayment gains |
|
| (26,474) |
|
|
| — |
|
|
| — |
|
|
| (17,491) |
|
|
| 12,841 |
|
Gain on sale of real estate associated with unconsolidated real estate entities |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (187 | ) |
|
| (10,389) |
|
FFO |
| $ | 65,431 |
|
| $ | 68,568 |
|
| $ | 64,863 |
|
| $ | 79,443 |
|
| $ | 71,104 |
|
FFO per share |
| $ | 0.27 |
|
| $ | 0.28 |
|
| $ | 0.27 |
|
| $ | 0.33 |
|
| $ | 0.30 |
|
CORE Funds From Operations (CFFO): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO |
| $ | 65,431 |
|
| $ | 68,568 |
|
| $ | 64,863 |
|
| $ | 79,443 |
|
| $ | 71,104 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other depreciation and amortization |
|
| 574 |
|
|
| 542 |
|
|
| 518 |
|
|
| 487 |
|
|
| 453 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
Loan (premium accretion) discount amortization, net |
|
| (2,018) |
|
|
| (2,021 | ) |
|
| (2,017 | ) |
|
| (2,013 | ) |
|
| (2,001 | ) |
Other loss |
|
| 29 |
|
|
| 105 |
|
|
| 86 |
|
|
| 238 |
|
|
| 12 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
CFFO |
| $ | 70,714 |
|
| $ | 66,641 |
|
| $ | 63,527 |
|
| $ | 78,910 |
|
| $ | 69,987 |
|
CFFO per share |
| $ | 0.29 |
|
| $ | 0.28 |
|
| $ | 0.26 |
|
| $ | 0.32 |
|
| $ | 0.29 |
|
Weighted-average shares and units outstanding |
|
| 241,365,153 |
|
|
| 241,342,036 |
|
|
| 242,374,371 |
|
|
| 243,707,137 |
|
|
| 239,576,189 |
|
| (a) | Included in the three months ended March 31, 2026, is $2.4 million of stock compensation expense recorded with respect to stock awards granted to retirement eligible employees. |
13
STATEMENTS OF OPERATIONS, FFO & CFFO
Dollars in thousands, except per share data
|
| For the Three Months Ended |
|
| For the Nine Months Ended |
|
||||||||||
|
| September 30, |
|
| September 30, |
|
||||||||||
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental and other property revenue |
| $ | 171,957 |
|
| $ | 166,888 |
|
| $ | 504,296 |
|
| $ | 489,684 |
|
Other revenue |
|
| 152 |
|
|
| 250 |
|
|
| 376 |
|
|
| 885 |
|
Total revenue |
|
| 172,109 |
|
|
| 167,138 |
|
|
| 504,672 |
|
|
| 490,569 |
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property operating expenses |
|
| 64,340 |
|
|
| 61,699 |
|
|
| 189,839 |
|
|
| 181,897 |
|
Property management expenses |
|
| 7,662 |
|
|
| 7,891 |
|
|
| 23,830 |
|
|
| 23,433 |
|
General and administrative expenses |
|
| 4,983 |
|
|
| 4,905 |
|
|
| 19,181 |
|
|
| 19,293 |
|
Depreciation and amortization expense |
|
| 65,874 |
|
|
| 61,735 |
|
|
| 195,367 |
|
|
| 180,256 |
|
Casualty losses, net |
|
| 498 |
|
|
| 419 |
|
|
| 22 |
|
|
| 559 |
|
Total expenses |
|
| 143,357 |
|
|
| 136,649 |
|
|
| 428,239 |
|
|
| 405,438 |
|
Interest expense |
|
| (22,723) |
|
|
| (20,455 | ) |
|
| (65,037) |
|
|
| (58,575 | ) |
Gain on sale (loss on impairment) of real estate assets, net |
|
| 26,474 |
|
|
| (12,841) |
|
|
| 26,474 |
|
|
| (11,344) |
|
Loss on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (67 | ) |
Other loss |
|
| (29) |
|
|
| (12) |
|
|
| (220) |
|
|
| (115 | ) |
(Loss) income from unconsolidated real estate entities |
|
| (555) |
|
|
| 9,814 |
|
|
| (2,438) |
|
|
| 8,663 |
|
Merger and integration costs |
|
| (6,200) |
|
|
| — |
|
|
| (6,200) |
|
|
| — |
|
Net income |
|
| 25,719 |
|
|
| 6,995 |
|
|
| 29,012 |
|
|
| 23,693 |
|
Income allocated to noncontrolling interests |
|
| (573) |
|
|
| (102 | ) |
|
| (541) |
|
|
| (401 | ) |
Net income available to common shares |
| $ | 25,146 |
|
| $ | 6,893 |
|
| $ | 28,471 |
|
| $ | 23,292 |
|
Earnings per share - basic |
| $ | 0.11 |
|
| $ | 0.03 |
|
| $ | 0.12 |
|
| $ | 0.10 |
|
Weighted-average shares outstanding - Basic |
|
| 235,423,510 |
|
|
| 233,634,546 |
|
|
| 235,748,513 |
|
|
| 232,628,917 |
|
Earnings per share - diluted |
| $ | 0.11 |
|
| $ | 0.03 |
|
| $ | 0.12 |
|
| $ | 0.10 |
|
Weighted-average shares outstanding - Diluted |
|
| 236,113,360 |
|
|
| 234,283,170 |
|
|
| 236,525,152 |
|
|
| 233,403,810 |
|
Funds From Operations (FFO): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
| $ | 25,719 |
|
| $ | 6,995 |
|
| $ | 29,012 |
|
| $ | 23,693 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate depreciation and amortization |
|
| 65,300 |
|
|
| 61,282 |
|
|
| 193,733 |
|
|
| 178,964 |
|
Our share of real estate depreciation and amortization from investments in unconsolidated real estate entities |
|
| 886 |
|
|
| 375 |
|
|
| 2,593 |
|
|
| 1,289 |
|
(Gain on sale) loss on impairment of real estate assets, net, excluding prepayment gains |
|
| (26,474) |
|
|
| 12,841 |
|
|
| (26,474) |
|
|
| 12,914 |
|
Gain on sale of real estate associated with unconsolidated real estate entities |
|
| — |
|
|
| (10,389) |
|
|
| — |
|
|
| (10,389) |
|
FFO |
| $ | 65,431 |
|
| $ | 71,104 |
|
| $ | 198,864 |
|
| $ | 206,471 |
|
FFO per share |
| $ | 0.27 |
|
| $ | 0.30 |
|
| $ | 0.82 |
|
| $ | 0.87 |
|
CORE Funds From Operations (CFFO): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO |
| $ | 65,431 |
|
| $ | 71,104 |
|
| $ | 198,864 |
|
| $ | 206,471 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other depreciation and amortization |
|
| 574 |
|
|
| 453 |
|
|
| 1,634 |
|
|
| 1,292 |
|
Casualty losses, net |
|
| 498 |
|
|
| 419 |
|
|
| 22 |
|
|
| 559 |
|
Loan (premium accretion) discount amortization, net |
|
| (2,018) |
|
|
| (2,001 | ) |
|
| (6,055) |
|
|
| (6,015 | ) |
Prepayment (gains) penalties on asset dispositions |
|
| — |
|
|
| — |
|
|
| — |
|
|
| (1,570 | ) |
Loss on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 67 |
|
Other loss |
|
| 29 |
|
|
| 12 |
|
|
| 220 |
|
|
| 115 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| 6,200 |
|
|
| — |
|
CFFO |
| $ | 70,714 |
|
| $ | 69,987 |
|
| $ | 200,885 |
|
| $ | 200,919 |
|
CFFO per share |
| $ | 0.29 |
|
| $ | 0.29 |
|
| $ | 0.83 |
|
| $ | 0.84 |
|
Weighted-average shares and units outstanding |
|
| 241,365,153 |
|
|
| 239,576,189 |
|
|
| 241,690,156 |
|
|
| 238,570,560 |
|
14
ADJUSTED EBITDA RECONCILIATION AND COVERAGE RATIO
Dollars in thousands
|
| Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
| 22,723 |
|
|
| 21,583 |
|
|
| 20,732 |
|
|
| 20,422 |
|
|
| 20,455 |
|
Depreciation and amortization |
|
| 65,874 |
|
|
| 64,861 |
|
|
| 64,632 |
|
|
| 62,984 |
|
|
| 61,735 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| — |
|
|
| — |
|
|
| (17,491) |
|
|
| 12,841 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| 836 |
|
|
| 1,047 |
|
|
| (2,403 | ) |
|
| (9,814) |
|
Other loss |
|
| 29 |
|
|
| 105 |
|
|
| 86 |
|
|
| 238 |
|
|
| 12 |
|
Adjusted EBITDA |
| $ | 95,124 |
|
| $ | 90,250 |
|
| $ | 86,447 |
|
| $ | 98,520 |
|
| $ | 92,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COST: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
| $ | 22,723 |
|
| $ | 21,583 |
|
| $ | 20,732 |
|
| $ | 20,422 |
|
| $ | 20,455 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COVERAGE: |
| 4.2x |
|
| 4.2x |
|
| 4.2x |
|
| 4.8x |
|
| 4.5x |
|
|||||
|
| For the Three Months Ended September 30, |
|
| For the Nine Months Ended September 30, |
|
||||||||||
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
|
||||
Net income |
| $ | 25,719 |
|
| $ | 6,995 |
|
| $ | 29,012 |
|
| $ | 23,693 |
|
Add-Back (Deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
| 22,723 |
|
|
| 20,455 |
|
|
| 65,037 |
|
|
| 58,575 |
|
Depreciation and amortization |
|
| 65,874 |
|
|
| 61,735 |
|
|
| 195,367 |
|
|
| 180,256 |
|
Casualty losses, net |
|
| 498 |
|
|
| 419 |
|
|
| 22 |
|
|
| 559 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| 12,841 |
|
|
| (26,474) |
|
|
| 11,344 |
|
Loss on extinguishment of debt |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 67 |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| 6,200 |
|
|
| — |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| (9,814) |
|
|
| 2,438 |
|
|
| (8,663) |
|
Other loss |
|
| 29 |
|
|
| 12 |
|
|
| 220 |
|
|
| 115 |
|
Adjusted EBITDA |
| $ | 95,124 |
|
| $ | 92,643 |
|
| $ | 271,822 |
|
| $ | 265,946 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COST: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
| $ | 22,723 |
|
| $ | 20,455 |
|
| $ | 65,037 |
|
| $ | 58,575 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTEREST COVERAGE: |
| 4.2x |
|
| 4.5x |
|
| 4.2x |
|
| 4.5x |
|
||||
15
SAME-STORE PORTFOLIO NET OPERATING INCOME & NOI BRIDGE (a) (b)
TRAILING FIVE QUARTERS
Dollars in thousands, except per unit data
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rental and other property revenue |
| $ | 161,319 |
|
| $ | 157,076 |
|
| $ | 156,095 |
|
| $ | 157,566 |
|
| $ | 158,216 |
|
Property Operating Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate taxes |
|
| 17,830 |
|
|
| 18,444 |
|
|
| 19,750 |
|
|
| 16,822 |
|
|
| 17,308 |
|
Property insurance |
|
| 2,714 |
|
|
| 3,010 |
|
|
| 3,278 |
|
|
| 3,275 |
|
|
| 3,264 |
|
Personnel expenses |
|
| 13,210 |
|
|
| 12,854 |
|
|
| 12,808 |
|
|
| 11,585 |
|
|
| 13,432 |
|
Utilities |
|
| 8,280 |
|
|
| 7,615 |
|
|
| 8,215 |
|
|
| 7,936 |
|
|
| 8,027 |
|
Repairs and maintenance |
|
| 5,732 |
|
|
| 5,883 |
|
|
| 4,175 |
|
|
| 3,750 |
|
|
| 5,591 |
|
Contract services |
|
| 6,961 |
|
|
| 6,578 |
|
|
| 6,161 |
|
|
| 6,087 |
|
|
| 6,078 |
|
Advertising expenses |
|
| 2,961 |
|
|
| 2,600 |
|
|
| 1,862 |
|
|
| 2,356 |
|
|
| 2,571 |
|
Other expenses |
|
| 1,682 |
|
|
| 1,659 |
|
|
| 1,590 |
|
|
| 1,593 |
|
|
| 1,634 |
|
Total property operating expenses |
|
| 59,370 |
|
|
| 58,643 |
|
|
| 57,839 |
|
|
| 53,404 |
|
|
| 57,905 |
|
Same-store portfolio NOI |
| $ | 101,949 |
|
| $ | 98,433 |
|
| $ | 98,256 |
|
| $ | 104,162 |
|
| $ | 100,311 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Same-store portfolio NOI margin |
|
| 63.2 | % |
|
| 62.7 | % |
|
| 62.9 | % |
|
| 66.1 | % |
|
| 63.4 | % |
Average occupancy |
|
| 95.0 | % |
|
| 95.0 | % |
|
| 95.3 | % |
|
| 95.4 | % |
|
| 95.4 | % |
Average effective monthly rent, per unit |
| $ | 1,605 |
|
| $ | 1,597 |
|
| $ | 1,594 |
|
| $ | 1,595 |
|
| $ | 1,595 |
|
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Rental and other property revenue |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Same-store portfolio |
| $ | 161,319 |
|
| $ | 157,076 |
|
| $ | 156,095 |
|
| $ | 157,566 |
|
| $ | 158,216 |
|
Non same-store portfolio |
|
| 10,638 |
|
|
| 10,050 |
|
|
| 9,118 |
|
|
| 9,231 |
|
|
| 8,672 |
|
Total rental and other property revenue |
|
| 171,957 |
|
|
| 167,126 |
|
|
| 165,213 |
|
|
| 166,797 |
|
|
| 166,888 |
|
Property operating expenses |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Same-store portfolio |
|
| 59,370 |
|
|
| 58,643 |
|
|
| 57,839 |
|
|
| 53,404 |
|
|
| 57,905 |
|
Non same-store portfolio |
|
| 4,970 |
|
|
| 4,732 |
|
|
| 4,285 |
|
|
| 3,856 |
|
|
| 3,794 |
|
Total property operating expenses |
|
| 64,340 |
|
|
| 63,375 |
|
|
| 62,124 |
|
|
| 57,260 |
|
|
| 61,699 |
|
NOI |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Same-store portfolio |
|
| 101,949 |
|
|
| 98,433 |
|
|
| 98,256 |
|
|
| 104,162 |
|
|
| 100,311 |
|
Non same-store portfolio |
|
| 5,668 |
|
|
| 5,318 |
|
|
| 4,833 |
|
|
| 5,375 |
|
|
| 4,878 |
|
Total property NOI |
| $ | 107,617 |
|
| $ | 103,751 |
|
| $ | 103,089 |
|
| $ | 109,537 |
|
| $ | 105,189 |
|
(a) | Same-store portfolio consists of 109 properties containing 31,735 units. |
(b) | See the definitions at the end of this release for a reconciliation from GAAP net income to NOI. |
16
SAME-STORE PORTFOLIO NET OPERATING INCOME (a)
THREE and nine MONTHS ENDED September 30, 2026 AND 2025
Dollars in thousands, except per unit data
| | For the Three Months Ended | | | For the Nine Months Ended | |
||||||||||||||||||
| | September 30, | | | September 30, | |
||||||||||||||||||
| | 2026 | | | 2025 | | | % change | | | 2026 | | | 2025 | | | % change | |
||||||
Revenue: | | | | | | | | | | | | | | | | | | | | | | | | |
Rental and other property revenue | | $ | 161,319 | | | $ | 158,216 | | | | 2.0 | % | | $ | 474,490 | | | $ | 467,832 | | | | 1.4 | % |
Property Operating Expenses: | | | | | | | | | | | | | | | | | | | | | | | | |
Real estate taxes | | | 17,830 | | | | 17,308 | | | | 3.0 | % | | | 56,023 | | | | 55,377 | | | | 1.2 | % |
Property insurance | | | 2,714 | | | | 3,264 | | | | (16.9 | )% | | | 9,003 | | | | 10,712 | | | | (16.0 | )% |
Personnel expenses | | | 13,210 | | | | 13,432 | | | | (1.7 | )% | | | 38,872 | | | | 37,756 | | | | 3.0 | % |
Utilities | | | 8,280 | | | | 8,027 | | | | 3.2 | % | | | 24,110 | | | | 23,221 | | | | 3.8 | % |
Repairs and maintenance | | | 5,732 | | | | 5,591 | | | | 2.5 | % | | | 15,790 | | | | 15,758 | | | | 0.2 | % |
Contract services | | | 6,961 | | | | 6,078 | | | | 14.5 | % | | | 19,700 | | | | 18,007 | | | | 9.4 | % |
Advertising expenses | | | 2,961 | | | | 2,571 | | | | 15.2 | % | | | 7,422 | | | | 7,190 | | | | 3.2 | % |
Other expenses | | | 1,682 | | | | 1,634 | | | | 2.9 | % | | | 4,930 | | | | 4,948 | | | | (0.4 | )% |
Total property operating expenses | | | 59,370 | | | | 57,905 | | | | 2.5 | % | | | 175,850 | | | | 172,969 | | | | 1.7 | % |
Same-store portfolio NOI | | $ | 101,949 | | | $ | 100,311 | | | | 1.6 | % | | $ | 298,640 | | | $ | 294,863 | | | | 1.3 | % |
| | | | | | | | | | | | | | | | | | | | | | | | |
Same-store portfolio NOI margin | | | 63.2 | % | | | 63.4 | % | | | (0.2 | )% | | | 62.9 | % | | | 63.0 | % | | | (0.1 | )% |
Average occupancy | | | 95.0 | % | | | 95.4 | % | | | (0.4 | )% | | | 95.1 | % | | | 95.4 | % | | | (0.3 | )% |
Average effective monthly rent, per unit | | $ | 1,605 | | | $ | 1,595 | | | | 0.6 | % | | $ | 1,599 | | | $ | 1,590 | | | | 0.6 | % |
(a) | Same-store portfolio consists of 109 properties containing 31,735 units. |
17
SAME-STORE PORTFOLIO NET OPERATING INCOME BY MARKET
THREE MONTHS ENDED September 30, 2026
Dollars in thousands, except rent per unit
|
|
|
|
|
| Rental and Other Property Revenue |
| Property Operating Expenses |
| Net Operating Income |
| Average Occupancy |
| Average Effective Monthly Rent per Unit |
||||||||||||||||||||
Market |
| Number of Properties |
| Units |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
Atlanta, GA |
| 13 |
| 5,180 |
| $ 25,758 |
| $ 25,005 |
| 3.0% |
| $ 9,728 |
| $ 9,869 |
| (1.4)% |
| $ 16,030 |
| $ 15,136 |
| 5.9% |
| 94.6% |
| 93.9% |
| 0.7% |
| $ 1,592 |
| $ 1,587 |
| 0.3% |
Dallas-Fort Worth, TX |
| 14 |
| 4,007 |
| 22,495 |
| 22,635 |
| (0.6)% |
| 8,333 |
| 8,535 |
| (2.4)% |
| 14,162 |
| 14,100 |
| 0.4% |
| 94.9% |
| 96.0% |
| (1.1)% |
| 1,802 |
| 1,810 |
| (0.4)% |
Columbus, OH |
| 10 |
| 2,510 |
| 12,564 |
| 12,014 |
| 4.6% |
| 4,799 |
| 4,605 |
| 4.2% |
| 7,765 |
| 7,409 |
| 4.8% |
| 94.5% |
| 95.6% |
| (1.1)% |
| 1,592 |
| 1,540 |
| 3.4% |
Tampa-St. Petersburg, FL |
| 6 |
| 1,791 |
| 10,822 |
| 10,858 |
| (0.3)% |
| 4,198 |
| 4,035 |
| 4.0% |
| 6,624 |
| 6,823 |
| (2.9)% |
| 95.7% |
| 96.1% |
| (0.4)% |
| 1,900 |
| 1,928 |
| (1.5)% |
Oklahoma City, OK |
| 8 |
| 2,147 |
| 8,835 |
| 8,665 |
| 2.0% |
| 2,988 |
| 2,978 |
| 0.3% |
| 5,847 |
| 5,687 |
| 2.8% |
| 96.3% |
| 95.8% |
| 0.5% |
| 1,295 |
| 1,263 |
| 2.5% |
Indianapolis, IN |
| 7 |
| 1,979 |
| 9,741 |
| 9,006 |
| 8.2% |
| 3,584 |
| 3,444 |
| 4.1% |
| 6,157 |
| 5,562 |
| 10.7% |
| 94.8% |
| 95.3% |
| (0.5)% |
| 1,488 |
| 1,457 |
| 2.1% |
Denver, CO |
| 6 |
| 1,418 |
| 8,205 |
| 8,396 |
| (2.3)% |
| 3,000 |
| 2,881 |
| 4.1% |
| 5,205 |
| 5,515 |
| (5.6)% |
| 95.2% |
| 94.7% |
| 0.5% |
| 1,850 |
| 1,874 |
| (1.3)% |
Nashville, TN |
| 5 |
| 1,508 |
| 8,104 |
| 7,712 |
| 5.1% |
| 2,744 |
| 1,978 |
| 38.7% |
| 5,360 |
| 5,734 |
| (6.5)% |
| 95.1% |
| 95.8% |
| (0.7)% |
| 1,629 |
| 1,622 |
| 0.4% |
Raleigh - Durham, NC |
| 6 |
| 1,690 |
| 8,234 |
| 8,209 |
| 0.3% |
| 3,086 |
| 3,013 |
| 2.4% |
| 5,148 |
| 5,196 |
| (0.9)% |
| 95.2% |
| 95.2% |
| 0.0% |
| 1,543 |
| 1,550 |
| (0.5)% |
Houston, TX |
| 5 |
| 1,308 |
| 6,075 |
| 6,073 |
| 0.0% |
| 2,649 |
| 2,386 |
| 11.0% |
| 3,426 |
| 3,687 |
| (7.1)% |
| 94.6% |
| 96.7% |
| (2.1)% |
| 1,463 |
| 1,449 |
| 1.0% |
Charlotte, NC |
| 4 |
| 1,014 |
| 5,214 |
| 5,192 |
| 0.4% |
| 1,766 |
| 1,694 |
| 4.3% |
| 3,448 |
| 3,498 |
| (1.4)% |
| 95.5% |
| 95.9% |
| (0.4)% |
| 1,660 |
| 1,675 |
| (0.9)% |
Lexington, KY |
| 3 |
| 886 |
| 4,520 |
| 4,266 |
| 6.0% |
| 1,285 |
| 1,249 |
| 2.9% |
| 3,235 |
| 3,017 |
| 7.2% |
| 95.0% |
| 96.7% |
| (1.7)% |
| 1,579 |
| 1,486 |
| 6.3% |
Huntsville, AL |
| 4 |
| 1,051 |
| 4,774 |
| 4,712 |
| 1.3% |
| 1,636 |
| 1,747 |
| (6.4)% |
| 3,138 |
| 2,965 |
| 5.8% |
| 94.1% |
| 95.4% |
| (1.3)% |
| 1,399 |
| 1,416 |
| (1.2)% |
Memphis, TN |
| 3 |
| 883 |
| 4,444 |
| 4,184 |
| 6.2% |
| 1,523 |
| 1,332 |
| 14.3% |
| 2,921 |
| 2,852 |
| 2.4% |
| 93.7% |
| 94.3% |
| (0.6)% |
| 1,542 |
| 1,573 |
| (2.0)% |
Louisville, KY |
| 3 |
| 794 |
| 3,637 |
| 3,502 |
| 3.9% |
| 1,333 |
| 1,380 |
| (3.4)% |
| 2,304 |
| 2,122 |
| 8.6% |
| 97.2% |
| 96.8% |
| 0.4% |
| 1,385 |
| 1,324 |
| 4.6% |
Orlando, FL |
| 2 |
| 617 |
| 3,536 |
| 3,581 |
| (1.3)% |
| 1,480 |
| 1,325 |
| 11.7% |
| 2,056 |
| 2,256 |
| (8.9)% |
| 93.9% |
| 95.3% |
| (1.4)% |
| 1,853 |
| 1,870 |
| (0.9)% |
Cincinnati, OH |
| 2 |
| 542 |
| 3,096 |
| 3,043 |
| 1.7% |
| 1,083 |
| 1,115 |
| (2.9)% |
| 2,013 |
| 1,928 |
| 4.4% |
| 95.2% |
| 97.3% |
| (2.1)% |
| 1,763 |
| 1,681 |
| 4.9% |
Charleston, SC |
| 2 |
| 518 |
| 2,916 |
| 2,841 |
| 2.6% |
| 1,120 |
| 1,141 |
| (1.8)% |
| 1,796 |
| 1,700 |
| 5.6% |
| 94.5% |
| 94.6% |
| (0.1)% |
| 1,849 |
| 1,778 |
| 4.0% |
Greenville, SC |
| 1 |
| 702 |
| 2,809 |
| 2,765 |
| 1.6% |
| 1,001 |
| 1,083 |
| (7.6)% |
| 1,808 |
| 1,682 |
| 7.5% |
| 95.7% |
| 94.9% |
| 0.8% |
| 1,297 |
| 1,288 |
| 0.7% |
Myrtle Beach, SC - Wilmington, NC |
| 3 |
| 628 |
| 2,685 |
| 2,658 |
| 1.0% |
| 965 |
| 972 |
| (0.7)% |
| 1,720 |
| 1,686 |
| 2.0% |
| 94.4% |
| 95.7% |
| (1.3)% |
| 1,384 |
| 1,385 |
| (0.1)% |
Austin, TX |
| 1 |
| 256 |
| 1,435 |
| 1,454 |
| (1.3)% |
| 530 |
| 564 |
| (6.0)% |
| 905 |
| 890 |
| 1.7% |
| 96.0% |
| 94.9% |
| 1.1% |
| 1,756 |
| 1,802 |
| (2.6)% |
San Antonio, TX |
| 1 |
| 306 |
| 1,420 |
| 1,445 |
| (1.7)% |
| 539 |
| 579 |
| (6.9)% |
| 881 |
| 866 |
| 1.7% |
| 96.3% |
| 98.2% |
| (1.9)% |
| 1,451 |
| 1,440 |
| 0.8% |
Total / Weighted Average |
| 109 |
| 31,735 |
| $ 161,319 |
| $ 158,216 |
| 2.0% |
| $ 59,370 |
| $ 57,905 |
| 2.5% |
| $ 101,949 |
| $ 100,311 |
| 1.6% |
| 95.0% |
| 95.4% |
| (0.4)% |
| $ 1,605 |
| $ 1,595 |
| 0.6% |
18
SAME-STORE PORTFOLIO NET OPERATING INCOME BY MARKET
Nine MONTHS ENDED September 30, 2026
Dollars in thousands, except rent per unit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
| Rental and Other Property Revenue |
| Property Operating Expenses |
| Net Operating Income |
| Average Occupancy |
| Average Effective Monthly Rent per Unit |
||||||||||||||||||||
Market |
| Number of Properties |
| Units |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
| 2026 |
| 2025 |
| % Change |
Atlanta, GA |
| 13 |
| 5,180 |
| $ 75,198 |
| $ 73,226 |
| 2.7% |
| $ 28,731 |
| $ 28,876 |
| (0.5)% |
| $ 46,467 |
| $ 44,350 |
| 4.8% |
| 94.5% |
| 93.6% |
| 0.9% |
| $ 1,584 |
| $ 1,590 |
| (0.4)% |
Dallas-Fort Worth, TX |
| 14 |
| 4,007 |
| 67,112 |
| 67,163 |
| (0.1)% |
| 25,638 |
| 25,557 |
| 0.3% |
| 41,474 |
| 41,606 |
| (0.3)% |
| 95.3% |
| 96.1% |
| (0.8)% |
| 1,803 |
| 1,810 |
| (0.4)% |
Columbus, OH |
| 10 |
| 2,510 |
| 36,761 |
| 35,594 |
| 3.3% |
| 14,021 |
| 13,881 |
| 1.0% |
| 22,740 |
| 21,713 |
| 4.7% |
| 95.0% |
| 95.8% |
| (0.8)% |
| 1,576 |
| 1,527 |
| 3.2% |
Tampa-St. Petersburg, FL |
| 6 |
| 1,791 |
| 32,332 |
| 32,149 |
| 0.6% |
| 12,304 |
| 11,866 |
| 3.7% |
| 20,028 |
| 20,283 |
| (1.3)% |
| 95.4% |
| 96.1% |
| (0.7)% |
| 1,917 |
| 1,919 |
| (0.1)% |
Oklahoma City, OK |
| 8 |
| 2,147 |
| 26,068 |
| 25,485 |
| 2.3% |
| 8,771 |
| 8,639 |
| 1.5% |
| 17,297 |
| 16,846 |
| 2.7% |
| 95.9% |
| 96.3% |
| (0.4)% |
| 1,283 |
| 1,247 |
| 2.9% |
Indianapolis, IN |
| 7 |
| 1,979 |
| 27,771 |
| 26,737 |
| 3.9% |
| 10,674 |
| 10,164 |
| 5.0% |
| 17,097 |
| 16,573 |
| 3.2% |
| 94.9% |
| 95.8% |
| (0.9)% |
| 1,481 |
| 1,453 |
| 1.9% |
Denver, CO |
| 6 |
| 1,418 |
| 24,244 |
| 24,732 |
| (2.0)% |
| 8,544 |
| 8,291 |
| 3.1% |
| 15,700 |
| 16,441 |
| (4.5)% |
| 94.9% |
| 95.0% |
| (0.1)% |
| 1,840 |
| 1,859 |
| (1.0)% |
Nashville, TN |
| 5 |
| 1,508 |
| 23,270 |
| 22,793 |
| 2.1% |
| 7,819 |
| 7,237 |
| 8.0% |
| 15,451 |
| 15,556 |
| (0.7)% |
| 95.5% |
| 95.9% |
| (0.4)% |
| 1,615 |
| 1,618 |
| (0.2)% |
Raleigh - Durham, NC |
| 6 |
| 1,690 |
| 24,375 |
| 24,353 |
| 0.1% |
| 9,193 |
| 9,115 |
| 0.9% |
| 15,182 |
| 15,238 |
| (0.4)% |
| 94.7% |
| 95.2% |
| (0.5)% |
| 1,539 |
| 1,546 |
| (0.5)% |
Houston, TX |
| 5 |
| 1,308 |
| 18,055 |
| 17,897 |
| 0.9% |
| 7,848 |
| 7,381 |
| 6.3% |
| 10,207 |
| 10,516 |
| (2.9)% |
| 95.2% |
| 96.4% |
| (1.2)% |
| 1,460 |
| 1,441 |
| 1.3% |
Charlotte, NC |
| 4 |
| 1,014 |
| 15,553 |
| 15,479 |
| 0.5% |
| 5,273 |
| 4,938 |
| 6.8% |
| 10,280 |
| 10,541 |
| (2.5)% |
| 95.6% |
| 94.7% |
| 0.9% |
| 1,661 |
| 1,696 |
| (2.1)% |
Lexington, KY |
| 3 |
| 886 |
| 13,298 |
| 12,472 |
| 6.6% |
| 3,750 |
| 3,653 |
| 2.7% |
| 9,548 |
| 8,819 |
| 8.3% |
| 95.6% |
| 96.8% |
| (1.2)% |
| 1,554 |
| 1,449 |
| 7.2% |
Huntsville, AL |
| 4 |
| 1,051 |
| 14,029 |
| 14,238 |
| (1.5)% |
| 5,036 |
| 5,219 |
| (3.5)% |
| 8,993 |
| 9,019 |
| (0.3)% |
| 95.0% |
| 95.6% |
| (0.6)% |
| 1,396 |
| 1,430 |
| (2.4)% |
Memphis, TN |
| 3 |
| 883 |
| 12,805 |
| 12,687 |
| 0.9% |
| 4,324 |
| 4,161 |
| 3.9% |
| 8,481 |
| 8,526 |
| (0.5)% |
| 95.0% |
| 95.3% |
| (0.3)% |
| 1,543 |
| 1,579 |
| (2.3)% |
Louisville, KY |
| 3 |
| 794 |
| 10,707 |
| 10,339 |
| 3.6% |
| 3,950 |
| 4,055 |
| (2.6)% |
| 6,757 |
| 6,284 |
| 7.5% |
| 96.3% |
| 96.5% |
| (0.2)% |
| 1,362 |
| 1,307 |
| 4.2% |
Orlando, FL |
| 2 |
| 617 |
| 10,478 |
| 10,580 |
| (1.0)% |
| 4,098 |
| 3,862 |
| 6.1% |
| 6,380 |
| 6,718 |
| (5.0)% |
| 93.0% |
| 95.1% |
| (2.1)% |
| 1,868 |
| 1,855 |
| 0.7% |
Cincinnati, OH |
| 2 |
| 542 |
| 9,169 |
| 8,879 |
| 3.3% |
| 3,324 |
| 3,284 |
| 1.2% |
| 5,845 |
| 5,595 |
| 4.5% |
| 96.0% |
| 96.9% |
| (0.9)% |
| 1,739 |
| 1,661 |
| 4.7% |
Charleston, SC |
| 2 |
| 518 |
| 8,620 |
| 8,403 |
| 2.6% |
| 3,349 |
| 3,342 |
| 0.2% |
| 5,271 |
| 5,061 |
| 4.1% |
| 94.8% |
| 95.0% |
| (0.2)% |
| 1,814 |
| 1,768 |
| 2.6% |
Greenville, SC |
| 1 |
| 702 |
| 8,289 |
| 8,061 |
| 2.8% |
| 3,007 |
| 3,153 |
| (4.6)% |
| 5,282 |
| 4,908 |
| 7.6% |
| 94.6% |
| 93.2% |
| 1.4% |
| 1,290 |
| 1,288 |
| 0.2% |
Myrtle Beach, SC - Wilmington, NC |
| 3 |
| 628 |
| 7,896 |
| 7,998 |
| (1.3)% |
| 2,829 |
| 2,803 |
| 0.9% |
| 5,067 |
| 5,195 |
| (2.5)% |
| 94.3% |
| 95.3% |
| (1.0)% |
| 1,383 |
| 1,386 |
| (0.2)% |
Austin, TX |
| 1 |
| 256 |
| 4,234 |
| 4,283 |
| (1.1)% |
| 1,685 |
| 1,736 |
| (2.9)% |
| 2,549 |
| 2,547 |
| 0.1% |
| 96.2% |
| 95.6% |
| 0.6% |
| 1,752 |
| 1,794 |
| (2.3)% |
San Antonio, TX |
| 1 |
| 306 |
| 4,226 |
| 4,284 |
| (1.4)% |
| 1,682 |
| 1,756 |
| (4.2)% |
| 2,544 |
| 2,528 |
| 0.6% |
| 96.9% |
| 97.4% |
| (0.5)% |
| 1,439 |
| 1,445 |
| (0.4)% |
Total / Weighted Average |
| 109 |
| 31,735 |
| $ 474,490 |
| $ 467,832 |
| 1.4% |
| $ 175,850 |
| $ 172,969 |
| 1.7% |
| $ 298,640 |
| $ 294,863 |
| 1.3% |
| 95.1% |
| 95.4% |
| (0.3)% |
| $ 1,599 |
| $ 1,590 |
| 0.6% |
19
CONSOLIDATED PROPERTY PORTFOLIO (a)
NET OPERATING INCOME EXPOSURE BY MARKET
Dollars in thousands, except rent per unit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Three Months Ended |
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| September 30, 2026 |
|
|||||||||
Market |
| Number of Properties |
|
| Units |
|
| Gross Real Estate Assets |
|
| Period of Occupancy |
|
| Average Effective Monthly Rent per Unit |
|
| NOI |
|
| % of NOI |
|
|||||||
Atlanta, GA |
|
| 13 |
|
|
| 5,180 |
|
| $ | 1,157,193 |
|
|
| 94.1 | % |
| $ | 1,595 |
|
| $ | 16,029 |
|
|
| 15.0 | % |
Dallas, TX |
|
| 14 |
|
|
| 4,007 |
|
|
| 913,580 |
|
|
| 95.0 | % |
|
| 1,804 |
|
|
| 14,162 |
|
|
| 13.3 | % |
Columbus, OH |
|
| 11 |
|
|
| 2,650 |
|
|
| 418,412 |
|
|
| 94.8 | % |
|
| 1,590 |
|
|
| 8,227 |
|
|
| 7.7 | % |
Indianapolis, IN |
|
| 8 |
|
|
| 2,259 |
|
|
| 370,099 |
|
|
| 95.0 | % |
|
| 1,507 |
|
|
| 7,044 |
|
|
| 6.6 | % |
Denver, CO (b)(c) |
|
| 8 |
|
|
| 2,018 |
|
|
| 626,877 |
|
|
| 95.0 | % |
|
| 1,764 |
|
|
| 6,757 |
|
|
| 6.3 | % |
Tampa-St. Petersburg, FL |
|
| 6 |
|
|
| 1,791 |
|
|
| 399,341 |
|
|
| 95.9 | % |
|
| 1,903 |
|
|
| 6,625 |
|
|
| 6.2 | % |
Oklahoma City, OK |
|
| 8 |
|
|
| 2,147 |
|
|
| 356,121 |
|
|
| 96.0 | % |
|
| 1,298 |
|
|
| 5,848 |
|
|
| 5.5 | % |
Nashville, TN |
|
| 5 |
|
|
| 1,508 |
|
|
| 382,902 |
|
|
| 95.6 | % |
|
| 1,630 |
|
|
| 5,360 |
|
|
| 5.0 | % |
Raleigh - Durham, NC |
|
| 6 |
|
|
| 1,690 |
|
|
| 263,859 |
|
|
| 94.6 | % |
|
| 1,548 |
|
|
| 5,148 |
|
|
| 4.8 | % |
Orlando, FL |
|
| 4 |
|
|
| 1,260 |
|
|
| 285,126 |
|
|
| 94.0 | % |
|
| 1,825 |
|
|
| 4,004 |
|
|
| 3.7 | % |
Charlotte, NC |
|
| 4 |
|
|
| 1,014 |
|
|
| 263,981 |
|
|
| 95.6 | % |
|
| 1,662 |
|
|
| 3,448 |
|
|
| 3.2 | % |
Houston, TX |
|
| 5 |
|
|
| 1,308 |
|
|
| 220,837 |
|
|
| 95.3 | % |
|
| 1,464 |
|
|
| 3,427 |
|
|
| 3.2 | % |
Lexington, KY |
|
| 3 |
|
|
| 886 |
|
|
| 172,211 |
|
|
| 94.8 | % |
|
| 1,582 |
|
|
| 3,235 |
|
|
| 3.0 | % |
Huntsville, AL |
|
| 4 |
|
|
| 1,051 |
|
|
| 245,130 |
|
|
| 94.4 | % |
|
| 1,401 |
|
|
| 3,116 |
|
|
| 2.9 | % |
Memphis, TN |
|
| 3 |
|
|
| 883 |
|
|
| 124,991 |
|
|
| 92.7 | % |
|
| 1,546 |
|
|
| 2,920 |
|
|
| 2.7 | % |
Louisville, KY |
|
| 3 |
|
|
| 794 |
|
|
| 99,289 |
|
|
| 96.3 | % |
|
| 1,386 |
|
|
| 2,304 |
|
|
| 2.2 | % |
Cincinnati, OH |
|
| 2 |
|
|
| 542 |
|
|
| 129,279 |
|
|
| 96.7 | % |
|
| 1,764 |
|
|
| 2,013 |
|
|
| 1.9 | % |
Greenville, SC |
|
| 1 |
|
|
| 702 |
|
|
| 128,748 |
|
|
| 96.0 | % |
|
| 1,299 |
|
|
| 1,808 |
|
|
| 1.7 | % |
Charleston, SC |
|
| 2 |
|
|
| 518 |
|
|
| 87,776 |
|
|
| 94.2 | % |
|
| 1,852 |
|
|
| 1,796 |
|
|
| 1.7 | % |
Myrtle Beach, SC - Wilmington, NC |
|
| 3 |
|
|
| 628 |
|
|
| 70,552 |
|
|
| 93.3 | % |
|
| 1,386 |
|
|
| 1,720 |
|
|
| 1.6 | % |
Austin, TX (a) |
|
| 1 |
|
|
| 256 |
|
|
| 62,410 |
|
|
| 96.1 | % |
|
| 1,756 |
|
|
| 905 |
|
|
| 0.9 | % |
San Antonio, TX |
|
| 1 |
|
|
| 306 |
|
|
| 58,313 |
|
|
| 96.7 | % |
|
| 1,451 |
|
|
| 881 |
|
|
| 0.9 | % |
Total / Weighted Average |
|
| 115 |
|
|
| 33,398 |
|
| $ | 6,837,027 |
|
|
| 94.9 | % |
| $ | 1,610 |
|
| $ | 106,777 |
|
|
| 100.0 | % |
(a) | Excludes our development project Tisdale at Lakeline Station. See the definitions of a development project at the end of this release. |
(b) | Includes properties in our Fort Collins, CO and Colorado Springs, CO markets. |
| (c) | Includes one property that was held for sale as of September 30, 2026. |
20
PROJECT LIFE TO DATE AS OF September 30, 2026
|
| Total |
|
| Total Units To Be |
|
| Units |
|
| Units |
|
| Rent Premium |
|
| % Rent |
|
| Renovation Costs per Unit (b) |
|
| ROI - Interior Costs |
|
| ROI - Total Costs |
|
|||||||||||||||||
Market |
| Properties |
|
| Renovated |
|
| Complete |
|
| Leased |
|
| (a) |
|
| Increase |
|
| Interior |
|
| Exterior |
|
| Total |
|
| (c) |
|
| (c) |
|
|||||||||||
ONGOING |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Atlanta, GA |
|
| 7 |
|
|
| 3,174 |
|
|
| 1,721 |
|
|
| 1,693 |
|
| $ | 190 |
|
|
| 13.7 | % |
| $ | 18,852 |
|
| $ | 3,053 |
|
| $ | 21,904 |
|
|
| 12.1 | % |
|
| 10.4 | % |
Dallas, TX |
|
| 7 |
|
|
| 1,925 |
|
|
| 1,233 |
|
|
| 1,227 |
|
|
| 317 |
|
|
| 21.7 | % |
|
| 19,571 |
|
|
| 2,713 |
|
|
| 22,283 |
|
|
| 19.4 | % |
|
| 17.1 | % |
Oklahoma City, OK |
|
| 4 |
|
|
| 1,086 |
|
|
| 665 |
|
|
| 660 |
|
|
| 258 |
|
|
| 23.7 | % |
|
| 16,947 |
|
|
| 2,719 |
|
|
| 19,666 |
|
|
| 18.3 | % |
|
| 15.8 | % |
Columbus, OH |
|
| 4 |
|
|
| 993 |
|
|
| 635 |
|
|
| 623 |
|
|
| 189 |
|
|
| 16.0 | % |
|
| 14,851 |
|
|
| 1,623 |
|
|
| 16,474 |
|
|
| 15.3 | % |
|
| 13.8 | % |
Lexington, KY |
|
| 2 |
|
|
| 586 |
|
|
| 284 |
|
|
| 275 |
|
|
| 379 |
|
|
| 31.9 | % |
|
| 17,928 |
|
|
| 1,419 |
|
|
| 19,347 |
|
|
| 25.4 | % |
|
| 23.5 | % |
Indianapolis, IN |
|
| 3 |
|
|
| 544 |
|
|
| 193 |
|
|
| 203 |
|
|
| 187 |
|
|
| 13.4 | % |
|
| 19,151 |
|
|
| 2,942 |
|
|
| 22,092 |
|
|
| 11.7 | % |
|
| 10.2 | % |
Charleston, SC |
|
| 2 |
|
|
| 518 |
|
|
| 158 |
|
|
| 152 |
|
|
| 280 |
|
|
| 16.4 | % |
|
| 17,900 |
|
|
| 3,462 |
|
|
| 21,362 |
|
|
| 18.8 | % |
|
| 15.7 | % |
Denver, CO |
|
| 2 |
|
|
| 491 |
|
|
| 302 |
|
|
| 297 |
|
|
| 321 |
|
|
| 25.5 | % |
|
| 14,906 |
|
|
| 3,788 |
|
|
| 18,693 |
|
|
| 25.9 | % |
|
| 20.6 | % |
Raleigh-Durham, NC |
|
| 2 |
|
|
| 488 |
|
|
| 207 |
|
|
| 203 |
|
|
| 213 |
|
|
| 15.7 | % |
|
| 18,465 |
|
|
| 3,130 |
|
|
| 21,594 |
|
|
| 13.9 | % |
|
| 11.9 | % |
Nashville, TN |
|
| 1 |
|
|
| 418 |
|
|
| 344 |
|
|
| 344 |
|
|
| 182 |
|
|
| 13.4 | % |
|
| 17,508 |
|
|
| 1,321 |
|
|
| 18,830 |
|
|
| 12.5 | % |
|
| 11.6 | % |
Cincinnati, OH |
|
| 1 |
|
|
| 350 |
|
|
| 29 |
|
|
| 28 |
|
|
| 276 |
|
|
| 19.4 | % |
|
| 19,524 |
|
|
| 1,714 |
|
|
| 21,238 |
|
|
| 17.0 | % |
|
| 15.6 | % |
Total / Weighted Average |
|
| 35 |
|
|
| 10,573 |
|
|
| 5,771 |
|
|
| 5,705 |
|
| $ | 244 |
|
|
| 18.5 | % |
| $ | 17,987 |
|
| $ | 2,671 |
|
| $ | 20,658 |
|
|
| 16.3 | % |
|
| 14.2 | % |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
FUTURE (d) |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Nashville, TN |
|
| 1 |
|
|
| 176 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 0.0 | % |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 0.0 | % |
|
| 0.0 | % |
Total / Weighted Average |
|
| 1 |
|
|
| 176 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
COMPLETED (e) |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Atlanta, GA |
|
| 4 |
|
|
| 1,482 |
|
|
| 1,399 |
|
|
| 1,391 |
|
|
| 245 |
|
|
| 21.4 | % |
|
| 12,436 |
|
|
| 1,503 |
|
|
| 13,939 |
|
|
| 23.7 | % |
|
| 21.1 | % |
Tampa-St. Petersburg, FL |
|
| 4 |
|
|
| 1,236 |
|
|
| 1,200 |
|
|
| 1,187 |
|
|
| 289 |
|
|
| 21.6 | % |
|
| 15,062 |
|
|
| 1,482 |
|
|
| 16,544 |
|
|
| 23.0 | % |
|
| 20.9 | % |
Columbus, OH |
|
| 4 |
|
|
| 1,077 |
|
|
| 1,004 |
|
|
| 998 |
|
|
| 250 |
|
|
| 23.4 | % |
|
| 12,422 |
|
|
| 1,030 |
|
|
| 13,452 |
|
|
| 24.1 | % |
|
| 22.3 | % |
Memphis, TN |
|
| 3 |
|
|
| 1,053 |
|
|
| 1,022 |
|
|
| 1,017 |
|
|
| 239 |
|
|
| 22.8 | % |
|
| 13,351 |
|
|
| 916 |
|
|
| 14,267 |
|
|
| 21.5 | % |
|
| 20.1 | % |
Louisville, KY |
|
| 2 |
|
|
| 728 |
|
|
| 728 |
|
|
| 786 |
|
|
| 214 |
|
|
| 24.0 | % |
|
| 15,663 |
|
|
| 2,173 |
|
|
| 17,837 |
|
|
| 16.4 | % |
|
| 14.4 | % |
Raleigh-Durham, NC |
|
| 2 |
|
|
| 646 |
|
|
| 606 |
|
|
| 604 |
|
|
| 197 |
|
|
| 17.5 | % |
|
| 15,417 |
|
|
| 1,585 |
|
|
| 17,003 |
|
|
| 15.3 | % |
|
| 13.9 | % |
Oklahoma City, OK |
|
| 2 |
|
|
| 541 |
|
|
| 476 |
|
|
| 473 |
|
|
| 119 |
|
|
| 14.3 | % |
|
| 17,228 |
|
|
| 1,154 |
|
|
| 18,382 |
|
|
| 8.3 | % |
|
| 7.8 | % |
Dallas, TX |
|
| 1 |
|
|
| 300 |
|
|
| 274 |
|
|
| 273 |
|
|
| 267 |
|
|
| 18.4 | % |
|
| 19,878 |
|
|
| 2,152 |
|
|
| 22,030 |
|
|
| 16.1 | % |
|
| 14.6 | % |
Wilmington, NC |
|
| 1 |
|
|
| 288 |
|
|
| 288 |
|
|
| 287 |
|
|
| 77 |
|
|
| 7.6 | % |
|
| 8,118 |
|
|
| 56 |
|
|
| 8,174 |
|
|
| 11.4 | % |
|
| 11.3 | % |
Austin, TX |
|
| 1 |
|
|
| 256 |
|
|
| 229 |
|
|
| 229 |
|
|
| 265 |
|
|
| 18.6 | % |
|
| 19,168 |
|
|
| 1,486 |
|
|
| 20,654 |
|
|
| 16.6 | % |
|
| 15.4 | % |
Indianapolis, IN |
|
| 1 |
|
|
| 236 |
|
|
| 215 |
|
|
| 214 |
|
|
| 241 |
|
|
| 22.2 | % |
|
| 15,775 |
|
|
| 1,484 |
|
|
| 17,259 |
|
|
| 18.3 | % |
|
| 16.7 | % |
Total / Weighted Average |
|
| 25 |
|
|
| 7,843 |
|
|
| 7,441 |
|
|
| 7,459 |
|
|
| 232 |
|
|
| 20.8 | % |
|
| 14,259 |
|
|
| 1,371 |
|
| $ | 15,630 |
|
|
| 19.5 | % |
|
| 17.8 | % |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Grand Total/Weighted Average |
|
| 61 |
|
|
| 18,592 |
|
|
| 13,212 |
|
|
| 13,164 |
|
| $ | 237 |
|
|
| 19.8 | % |
| $ | 15,874 |
|
| $ | 2,161 |
|
| $ | 18,035 |
|
|
| 17.9 | % |
|
| 15.8 | % |
(a) | See the definitions section for a full description of Rent Premium. The weighted average Rent Premium including the impact of concessions was $207. |
(b) | See the definitions section for a full description of Renovation Costs per Unit. |
(c) | See the definitions section for a full description of ROI. ROI-Interior costs using rent premium including the impact of concessions was 15.6%. ROI-Total costs using rent premium including the impact of concessions was 13.8%. |
(d) | Projects scheduled to start in Q1 2027 are located in Nashville, TN. |
(e) | We consider value add projects completed when over 85% of the property’s units to be renovated have been completed. We continue to renovate remaining unrenovated units as leases expire until we complete 100% of the property’s units. |
21
INVESTMENT AND DEVELOPMENT ACTIVITY
Dollars in thousands except per unit amounts
2026 ACQUISITIONS
Property |
| Market |
| Units |
|
| Date Acquired |
| Purchase Price |
|
| Price per Unit |
|
| Average Rent per Unit at Acquisition |
|
||||
The Retreat at Canal |
| Columbus, OH |
|
| 140 |
|
| 1/15/2026 |
| $ | 29,500 |
|
| $ | 211 |
|
| $ | 1,455 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2026 DISPOSITIONS
Property | Location | | Units | | Date Sold | | Sale Price | | | Price per Unit | | | Average Rent per Unit at Disposition | | | Gain on Sale | |
|||||
Stonebridge Crossing | Memphis, TN | | | 500 | | 9/10/2026 | | $ | 55,750 | | | $ | 112 | | | $ | 1,204 | | | $ | 26,474 | |
ASSETS HELD FOR SALE AS OF SEPTEMBER 30, 2026
Property |
| Location |
| Units |
|
|
Bella Terra at City Center |
| Denver, Colorado |
|
| 304 |
|
|
|
|
|
|
|
|
22
REAL ESTATE UNDER DEVELOPMENT (a) |
Development |
| Tisdale at Lakeline Station (a) |
Location |
| Austin, Texas |
Planned Units |
| 378 |
Start Date |
| 2Q 2022 |
Initial Occupancy |
| 4Q 2025 |
Completion Date |
| 4Q 2025 |
Projected Stabilization date |
| 1Q 2027 |
Total Development Costs |
| $110,551 |
% of Planned Units Delivered as of September 30, 2026 |
| 100% |
Occupancy % as of October 28, 2026 (b) |
| 53.5% |
Leased % as of October 28, 2026 (b) |
| 58.2% |
INVESTMENTS IN UNCONSOLIDATED REAL ESTATE ENTITIES |
|
| Lakeline Station (a) |
|
| The Mustang (c) |
|
| Nexton Pine Hollow |
|
| The Approach |
|
|
|
| |
||||
Location |
| Austin, TX |
|
| Dallas, TX |
|
| Charleston, SC |
|
| Indianapolis, IN |
|
| Total |
|
|||||
Units |
|
| 378 |
|
|
| 275 |
|
|
| 324 |
|
|
| 318 |
|
|
| 1,295 |
|
Estimated delivery date |
|
| — |
|
|
| — |
|
| Q2 2027 |
|
| Q3 2027 |
|
|
|
| |
||
Total construction budget |
| $ | — |
|
| $ | 109,583 |
|
| $ | 78,949 |
|
| $ | 79,364 |
|
| $ | 267,896 |
|
Total project debt |
| $ | — |
|
| $ | 79,447 |
|
|
| 47,191 |
|
|
| 49,250 |
|
|
|
| |
Remaining expected IRT investment |
| $ | — |
|
|
| — |
|
|
| — |
|
|
| 3,595 |
|
| $ | 3,595 |
|
Carrying value of IRT's investment |
| $ | — |
|
| $ | 30,368 |
|
|
| 30,260 |
|
|
| 17,162 |
|
| $ | 77,790 |
|
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Three Months Ended September 30, 2026 |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
NOI |
| $ | — |
|
| $ | 1,209 |
|
| $ | — |
|
| $ | — |
|
| $ | 1,209 |
|
Interest expense |
|
| — |
|
|
| (1,054 | ) |
|
| — |
|
|
| — |
|
|
| (1,054 | ) |
CFFO |
| $ | — |
|
| $ | 155 |
|
| $ | — |
|
| $ | — |
|
| $ | 155 |
|
Depreciation |
|
| — |
|
|
| (1,042 | ) |
|
| — |
|
|
| — |
|
|
| (1,042 | ) |
Other income |
|
| — |
|
|
| 7 |
|
|
| — |
|
|
| — |
|
|
| 7 |
|
Net (loss) income |
| $ | — |
|
| $ | (880 | ) |
| $ | — |
|
| $ | — |
|
| $ | (880 | ) |
IRT Equity Interest in JV |
|
|
| |
|
| 85.0 | % |
|
| 90.0 | % |
|
| 66.6 | % |
|
|
| |
IRT Equity pick-up |
| $ | — |
|
| $ | (748 | ) |
| $ | — |
|
| $ | 193 |
|
| $ | (555 | ) |
|
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
Nine Months Ended September 30, 2026 |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
NOI |
| $ | (12 | ) |
| $ | 3,238 |
|
| $ | — |
|
| $ | — |
|
| $ | 3,226 |
|
Interest expense |
|
| (52 | ) |
|
| (3,400 | ) |
|
| — |
|
|
| — |
|
|
| (3,452 | ) |
CFFO |
| $ | (64 | ) |
| $ | (162 | ) |
| $ | — |
|
| $ | — |
|
| $ | (226 | ) |
Depreciation |
|
| (41 | ) |
|
| (3,007 | ) |
|
| — |
|
|
| — |
|
|
| (3,048 | ) |
Other income |
|
| 1 |
|
|
| (11 | ) |
|
| — |
|
|
| — |
|
|
| (10 | ) |
Net (loss) income |
| $ | (104 | ) |
| $ | (3,180 | ) |
| $ | — |
|
| $ | — |
|
| $ | (3,284 | ) |
IRT Equity Interest in JV |
|
| 90.0 | % |
|
| 85.0 | % |
|
| 90.0 | % |
|
| 66.6 | % |
|
|
| |
IRT Equity pick-up |
| $ | (94 | ) |
| $ | (2,702 | ) |
| $ | — |
|
| $ | 358 |
|
| $ | (2,438 | ) |
| (a) | Lakeline Station was an investment in unconsolidated real estate entity from January 1-19, 2026 and the underlying property, Tisdale at Lakeline Station was consolidated into our financial results effective January 20, 2026. Tisdale at Lakeline Station will continue to be classified as a development property since it is in lease-up and has not yet reached overall occupancy of 90%. |
| (b) | Leased % and occupancy % are calculated using the leased or occupied units, as applicable, divided by the total number of units. |
| (c) | The Mustang is an operating property consisting of 275 units. As of September 30, 2026, The Mustang was 94% occupied with average effective monthly rent per occupied unit of $3,071. Subsequent to quarter-end, on October 1, 2026, we acquired our joint venture partner's 15% membership interest and assumed full operational control and 100% equity ownership of The Mustang. We will begin consolidating the assets and liabilities of the property and its operating results effective October 1, 2026. |
|
|
|
23
DEBT SUMMARY AS OF September 30, 2026
Dollars in thousands
|
| Amount |
|
| Weighted Average Contractual Rate |
|
| Weighted Average Hedged Effective Rate (a) |
|
| Type |
| Weighted Average Maturity (in years) |
|
||||
Debt: |
|
|
| |
|
|
| |
|
|
| |
|
|
|
|
| |
Unsecured revolver (b) |
| $ | 274,372 |
|
|
| 4.6 | % |
|
| 4.8 | % |
| Floating |
|
| 2.3 |
|
Unsecured term loans (c) |
|
| 750,000 |
|
|
| 4.7 | % |
|
| 4.0 | % |
| Floating |
|
| 2.3 |
|
Secured credit facilities (d) |
|
| 575,689 |
|
|
| 4.2 | % |
|
| 4.4 | % |
| Fixed |
|
| 2.2 |
|
Mortgages |
|
| 646,542 |
|
|
| 3.9 | % |
|
| 4.0 | % |
| Fixed |
|
| 2.9 |
|
Unsecured notes (e) |
|
| 150,000 |
|
|
| 5.4 | % |
|
| 5.6 | % |
| Fixed |
|
| 6.5 |
|
Total Principal |
|
| 2,396,603 |
|
|
| 4.4 | % |
|
| 4.3 | % |
|
|
|
| 2.7 |
|
Loan premiums (discounts), net |
|
| 15,795 |
|
|
|
| |
|
|
| |
|
|
|
|
| |
Unamortized deferred financing costs |
|
| (10,941 | ) |
|
|
| |
| Credit Ratings: |
|
|
|
|
|
| |
|
Total Consolidated Debt |
|
| 2,401,457 |
|
|
|
| |
| Agency |
|
| Rating |
| Outlook |
|
||
Equity Market Capitalization |
|
| 3,511,388 |
|
|
|
| |
| Fitch |
|
| BBB |
| Positive |
|
||
Total Capitalization |
| $ | 5,912,845 |
|
|
|
| |
| S&P |
|
| BBB |
| Stable |
|
||
| (a) | Represents the weighted average effective interest rates for the three months ended September 30, 2026, including the impact of interest rate swaps and collars, amortization of hedging costs, and deferred financing costs but excluding the impact of loan premium amortization, discount accretion, and interest capitalization. As of September 30, 2026, we maintained hedges that have effectively fixed a portion of our floating rate debt as follows: |
Hedges: |
| Notional |
| Start |
| End |
| Swap Rate |
| Floor Rate |
| Cap Rate |
Swap |
| $ 150,000 |
| 5/17/2022 |
| 5/17/2027 |
| 0.99% |
| — |
| — |
Swap |
| $ 200,000 |
| 3/17/2023 |
| 3/17/2030 |
| 3.39% |
| — |
| — |
Collar |
| $ 100,000 |
| 1/17/2024 |
| 1/17/2028 |
| — |
| 1.50% |
| 2.50% |
Collar |
| $ 100,000 |
| 11/17/2024 |
| 1/17/2028 |
| — |
| 1.50% |
| 2.50% |
Swap |
| $ 150,000 |
| 6/17/2026 |
| 6/17/2030 |
| 3.26% |
| — |
| — |
| (b) | Unsecured revolver total capacity is $750,000, of which $274,372 was drawn as of September 30, 2026. The maturity date of the borrowings under the unsecured revolver is January 8, 2029. |
| (c) | Consists of a (i) $350,000 unsecured term loan with a maturity date of February 11, 2030 and a (ii) $400,000 unsecured term loan with a maturity date of January 28, 2028. |
| (d) | Consists of a (i) $501,488 secured credit facility, two tranches of which, in an aggregate principal amount of $461,020, have a maturity date of August 1, 2028 and the third tranche of which, in the principal amount of $40,468, has a maturity date of March 1, 2030 and a (ii) $74,201 secured credit facility with a maturity date of July 1, 2030. |
| (e) | Consists of (i) $75,000 aggregate principal amount of unsecured private placement notes with a maturity date of October 1, 2031 and at a fixed annual interest rate of 5.32% and (ii) $75,000 aggregate principal amount of unsecured private placement notes with a maturity date of October 1, 2034 and at a fixed annual interest rate of 5.53%. |
24
AS OF September 30, 2026
Dollars in thousands
Debt Covenant Summary (a)
|
| Requirement |
| Actual |
| Compliance |
Consolidated leverage ratio |
| ≤ 60% |
| 32.0% |
| Yes |
Consolidated fixed charge coverage ratio |
| ≥ 1.5x |
| 3.1x |
| Yes |
Unsecured leverage ratio |
| ≤ 60% |
| 23.9% |
| Yes |
(a) | For a complete listing of all debt covenants along with definitions of each covenant calculation see the Sixth Amended and Restated Credit Agreement, which was filed as Exhibit 10.1 of our Form 8-K filed on February 11, 2026. |
Encumbered & Unencumbered Statistics (b)
|
| Total Units |
|
| % of Total |
|
| Gross Real Estate Assets |
|
| % of Total |
|
| Q3 2026 NOI |
|
| % of Total |
|
||||||
Unencumbered assets |
|
| 22,323 |
|
|
| 66.8 | % |
| $ | 4,187,024 |
|
|
| 61.2 | % |
| $ | 71,062 |
|
|
| 66.6 | % |
Encumbered assets |
|
| 11,075 |
|
|
| 33.2 | % |
|
| 2,650,003 |
|
|
| 38.8 | % |
|
| 35,715 |
|
|
| 33.4 | % |
|
|
| 33,398 |
|
|
| 100.0 | % |
| $ | 6,837,027 |
|
|
| 100.0 | % |
| $ | 106,777 |
|
|
| 100.0 | % |
(b) | Excludes our development project Tisdale at Lakeline Station. See the definitions at the end of this release. |
Components of Interest Expense
|
| For the Three Months Ended |
|
| For the Nine Months Ended |
|
||||||||||
|
| September 30, 2026 |
|
| September 30, 2025 |
|
| September 30, 2026 |
|
| September 30, 2025 |
|
||||
Interest expense on secured and unsecured debt |
| $ | 26,867 |
|
| $ | 27,119 |
|
| $ | 78,823 |
|
| $ | 78,765 |
|
Plus: Senior unsecured credit facility commitment fees and other finance related charges |
|
| 288 |
|
|
| 288 |
|
|
| 887 |
|
|
| 868 |
|
Plus: Amortization of deferred financing costs |
|
| 1,038 |
|
|
| 919 |
|
|
| 3,103 |
|
|
| 2,727 |
|
Plus: Amortization related to derivative instruments |
|
| 224 |
|
|
| 243 |
|
|
| 674 |
|
|
| 750 |
|
Less: Gain on interest rate hedges |
|
| (1,942 | ) |
|
| (3,728 | ) |
|
| (6,499 | ) |
|
| (10,945 | ) |
Less: Capitalized interest |
|
| (1,734 | ) |
|
| (2,385 | ) |
|
| (5,896 | ) |
|
| (7,576 | ) |
Interest expense before loan (premium accretion) discount amortization, net |
|
| 24,741 |
|
|
| 22,456 |
|
|
| 71,092 |
|
|
| 64,590 |
|
Less: Loan (premium accretion) discount amortization, net (c) |
|
| (2,018 | ) |
|
| (2,001 | ) |
|
| (6,055 | ) |
|
| (6,015 | ) |
Interest expense per our Consolidated Statement of Operations |
| $ | 22,723 |
|
| $ | 20,455 |
|
| $ | 65,037 |
|
| $ | 58,575 |
|
(c) | Represents loan premiums and discounts associated with debt assumed in conjunction with property acquisitions. Reconciles our CFFO interest expense to our GAAP interest expense on our condensed consolidated statements of operations. |
25
Average Effective Monthly Rent per Unit
Average effective rent per unit represents the average of net rent amounts, after concessions amortized over the life of the lease, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measurement in evaluating average pricing. This metric, when presented, reflects the average effective rent per month.
Average Occupancy
Average occupancy represents the average occupied units for the reporting period divided by the average of total units available for rent for the reporting period.
Development Property
A development property is a property that is either currently under development or is in lease-up prior to reaching overall occupancy of 90%.
EBITDA and Adjusted EBITDA
Each of EBITDA and Adjusted EBITDA is a non-GAAP financial measure. EBITDA is defined as net income before interest expense including amortization of deferred financing costs, income tax expense, and depreciation and amortization expenses. Adjusted EBITDA is EBITDA before certain other non-cash or non-operating gains or losses related to items such as merger and integration costs, loss on impairment (gain on sale) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses and income (loss) from investments in unconsolidated real estate entities. We consider each of EBITDA and Adjusted EBITDA to be an appropriate supplemental measure of performance because it eliminates interest, income taxes, depreciation and amortization, and other non-cash or non-operating gains and losses, which permits investors to view income from operations without these non-cash or non-operating items. Our calculation of Adjusted EBITDA differs from the methodology used for calculating Adjusted EBITDA by certain other REITs and, accordingly, our Adjusted EBITDA may not be comparable to Adjusted EBITDA reported by other REITs.
26
Funds From Operations (“FFO”) and Core Funds From Operations (“CFFO”)
We believe that FFO and CFFO, each of which is a non-GAAP financial measure, are additional appropriate measures of the operating performance of a REIT and us in particular. We compute FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”), as net income or loss allocated to common shares (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, loss on impairment (gain on sale) of real estate and unconsolidated real estate entities, and the cumulative effect of changes in accounting principles. While our calculation of FFO is in accordance with NAREIT’s definition, it may differ from the methodology for calculating FFO utilized by other REITs and, accordingly, may not be comparable to FFO computations of such other REITs.
CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash, non-operating gains or losses or non-recurring items related to items such as merger and integration costs, which are cash costs that we do not consider indicative of our ongoing operations, casualty (gains) losses, loan premium accretion and discount amortization and debt extinguishment costs from the determination of FFO.
Our calculation of CFFO may differ from the methodology used for calculating CFFO by other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance, management believes they are also useful to investors, because they facilitate an understanding of our operating performance after adjustment for certain non-cash, non-operating or non-recurring items that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and our operating performance between periods. Furthermore, although FFO, CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we believe that FFO and CFFO may provide us and our investors with an additional useful measure to compare our financial performance to certain other REITs. Neither FFO nor CFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Accordingly, FFO and CFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization and capital improvements. Neither FFO nor CFFO should be considered as an alternative to net income or any other GAAP measurement as an indicator of our operating performance or as an alternative to cash flow from operating, investing, and financing activities as a measure of our liquidity.
Interest Coverage
Interest coverage is a ratio computed by dividing Adjusted EBITDA by interest expense.
Lease Over Lease Effective Rent Growth
Lease Over Lease Effective Rent Growth represents the change in the weighted average effective monthly rental rate, including the impact of concessions, of a lease compared to the prior lease for that same unit. We report this statistic on both a like-term basis and an all leases basis. The like-term basis includes cases where both the current and prior lease associated with a unit reflect standard leasing activity and have terms of 9-14 months. An all leases basis includes all leases regardless of lease terms. We may report Lease Over Lease Effective Rent Growth for new leases, renewal leases, or blended across both new and renewal leases.
27
Net Debt
Net debt, a non-GAAP financial measure, equals total consolidated debt less cash and cash equivalents and loan premiums and discounts. The following table provides a reconciliation of total consolidated debt to net debt (dollars in thousands).
|
| As of |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Total debt |
| $ | 2,401,457 |
|
| $ | 2,443,383 |
|
| $ | 2,433,543 |
|
| $ | 2,281,475 |
|
| $ | 2,296,202 |
|
Less: cash and cash equivalents |
|
| (15,931) |
|
|
| (22,513) |
|
|
| (23,341 | ) |
|
| (23,564 | ) |
|
| (23,290 | ) |
Less: loan discounts and premiums, net |
|
| (15,795) |
|
|
| (17,813 | ) |
|
| (19,833 | ) |
|
| (21,850 | ) |
|
| (23,863 | ) |
Total net debt |
| $ | 2,369,731 |
|
| $ | 2,403,057 |
|
| $ | 2,390,369 |
|
| $ | 2,236,061 |
|
| $ | 2,249,049 |
|
We present net debt and net debt to Adjusted EBITDA because management believes it is a useful measure of our credit position and progress toward reducing leverage. The calculation is limited because we may not always be able to use cash to repay debt on a dollar for dollar basis.
Net Operating Income
We believe that Net Operating Income (“NOI”), a non-GAAP financial measure, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expense, depreciation and amortization, casualty related costs and gains, merger and integration costs, property management expenses, general and administrative expenses and net gains on sale of assets.
Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as a supplemental measure of our financial performance and should not be considered as an alternative to net income or any other GAAP measure.
A reconciliation from GAAP net income (loss) to NOI is provided below (dollars in thousands):
|
| For the Three Months Ended |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Net income (loss) |
| $ | 25,719 |
|
| $ | 3,418 |
|
| $ | (127) |
|
| $ | 34,015 |
|
| $ | 6,995 |
|
Other revenue |
|
| (152) |
|
|
| (115) |
|
|
| (109 | ) |
|
| (330 | ) |
|
| (250 | ) |
Property management expenses |
|
| 7,662 |
|
|
| 7,931 |
|
|
| 8,237 |
|
|
| 6,674 |
|
|
| 7,891 |
|
General and administrative expenses |
|
| 4,983 |
|
|
| 5,685 |
|
|
| 8,514 |
|
|
| 4,673 |
|
|
| 4,905 |
|
Depreciation and amortization expense |
|
| 65,874 |
|
|
| 64,861 |
|
|
| 64,632 |
|
|
| 62,984 |
|
|
| 61,735 |
|
Casualty losses (gains), net |
|
| 498 |
|
|
| (553) |
|
|
| 77 |
|
|
| 755 |
|
|
| 419 |
|
Interest expense |
|
| 22,723 |
|
|
| 21,583 |
|
|
| 20,732 |
|
|
| 20,422 |
|
|
| 20,455 |
|
(Gain on sale) loss on impairment of real estate assets, net |
|
| (26,474) |
|
|
| — |
|
|
| — |
|
|
| (17,491) |
|
|
| 12,841 |
|
Other loss |
|
| 29 |
|
|
| 105 |
|
|
| 86 |
|
|
| 238 |
|
|
| 12 |
|
Loss (income) from investments in unconsolidated real estate entities |
|
| 555 |
|
|
| 836 |
|
|
| 1,047 |
|
|
| (2,403 | ) |
|
| (9,814) |
|
Merger and integration costs |
|
| 6,200 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
NOI |
| $ | 107,617 |
|
| $ | 103,751 |
|
| $ | 103,089 |
|
| $ | 109,537 |
|
| $ | 105,189 |
|
Less: Non same-store portfolio NOI |
|
| 5,668 |
|
|
| 5,318 |
|
|
| 4,833 |
|
|
| 5,375 |
|
|
| 4,878 |
|
Same-store portfolio NOI |
| $ | 101,949 |
|
| $ | 98,433 |
|
| $ | 98,256 |
|
| $ | 104,162 |
|
| $ | 100,311 |
|
28
Non Same-Store Properties and Non Same-Store Portfolio
Properties that did not meet the definition of a same-store property as of the beginning of the previous year.
Same-Store Properties and Same-Store Portfolio
We review our same-store portfolio at the beginning of each calendar year. Properties are added into the same-store portfolio if they were owned and not a development property at the beginning of the previous year. Properties that are held for sale or have been sold are excluded from the same-store portfolio.
Rent Premium on Value Add Renovations
The rent premium reflects the per unit per month difference between the rental rate on the renovated unit excluding the impact of upfront concessions, if any, and the market rent for an unrenovated unit as of the date presented, as determined by management consistent with its customary rent-setting and evaluation procedures. We believe excluding the impact of upfront concessions from our rental rates when comparing to the market rental rates for unrenovated units makes the comparison most relevant and the resulting premium provides management with an indicator of the increased rent generated by the unit renovation.
Renovation Costs per Unit
Renovation costs per unit includes all costs to renovate the interior units and make certain exterior renovations, including clubhouses and amenities. Interior costs per unit are based on units leased. Exterior costs per unit are based on total units at the community. Excludes overhead costs to support and manage the value add program as those costs relate to the entire program and cannot be allocated to individual projects.
Return on Investment (“ROI”) on Value Add Renovations
ROI is calculated using the Rent Premium per unit per month, multiplied by 12, divided by the interior renovation costs per unit or the total renovation costs, as applicable. We use ROI on value add renovation projects to measure the profitability of a renovation project relative to other projects or relative to other uses of our capital.
Total Gross Assets
Total Gross Assets equals total assets plus accumulated depreciation and accumulated amortization, including fully depreciated or amortized real estate and real estate related assets. The following table provides a reconciliation of total assets to total gross assets (dollars in thousands).
|
| As of |
|
|||||||||||||||||
|
| September 30, 2026 |
|
| June 30, 2026 |
|
| March 31, 2026 |
|
| December 31, 2025 |
|
| September 30, 2025 |
|
|||||
Total assets |
| $ | 6,080,105 |
|
| $ | 6,091,687 |
|
| $ | 6,099,308 |
|
| $ | 6,021,750 |
|
| $ | 6,092,592 |
|
Plus: accumulated depreciation (a) |
|
| 1,092,563 |
|
|
| 1,045,803 |
|
|
| 989,530 |
|
|
| 932,347 |
|
|
| 890,039 |
|
Plus: accumulated amortization |
|
| 79,975 |
|
|
| 79,724 |
|
|
| 78,578 |
|
|
| 76,419 |
|
|
| 75,395 |
|
Total gross assets |
| $ | 7,252,643 |
|
| $ | 7,217,214 |
|
| $ | 7,167,416 |
|
| $ | 7,030,516 |
|
| $ | 7,058,026 |
|
(a) | Includes accumulated depreciation associated with real estate held for sale, as applicable. |
29