UDR INC. sector leader 2021
REAL ESTATE
2022
Q1 | 2022
EARNINGS RELEASE &SUPPLEMENTAL FINANCIAL INFORMATION
UDR, Inc. (NYSE: UDR) is a leading S&P 500 real estate investment trust with a demonstrated performance
• $25.7 Billion Enterprise Value
• 21 Markets
history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive multifamily communities in targeted U.S. markets.
• 180 Communities
• 57,904 Apartment Homes
Joe Fisher, CFO - 720.283.6139 | Trent Trujillo, Investor Relations - 720.283.6135
UDR, INC. | UDR.COM
UDR First Quarter 2022 Earnings Supplement
1Q 2022 Earnings Press Release ........................................................................................................................................ Pages 1-5
Company
Financial Highlights
Consolidated Statements of Operations ............................................................................................................................ Attachment 1
Funds From Operations (FFO), FFO as Adjusted, AFFO .................................................................................................. Attachment 2
Consolidated Balance Sheets ............................................................................................................................................ Attachment 3
Selected Financial Information
Common Stock and Equivalents, and Weighted Average Number of Shares Outstanding ........................................... Attachment 4(A) Debt Structure and Debt Maturities Schedules .............................................................................................................. Attachment 4(B) Coverage Ratios, Debt Covenant Analysis, Securities Ratings, and Asset Summary .................................................. Attachment 4(C)
Operations
Revenue, Expense, NOI, Operating Margin, Quarterly Trends Comparison ..................................................................... Attachment 5
Same-Store Operating Expense Information ..................................................................................................................... Attachment 6
Portfolio Overview - Apartment Home Breakout ........................................................................................................... Attachment 7(A)
Portfolio Overview - Non-Mature Apartment Home Summary and Net Operating Income by Market ........................... Attachment 7(B)
Submarket
Current Quarter vs. Prior Year Quarter Occupancy, and Total Income per Occupied Home Information ...................... Attachment 8(A)
Current Quarter vs. Prior Year Quarter Revenue, Expense, and NOI Information ........................................................ Attachment 8(B)
Current Quarter vs. Last Quarter Occupancy, and Total Income per Occupied Home Information ............................... Attachment 8(C)
Current Quarter vs. Last Quarter Revenue, Expense, and NOI Information .................................................................. Attachment 8(D)
Lease Rate Growth and Turnover Information ............................................................................................................... Attachment 8(E)
Development, Redevelopment, Acquisitions and Dispositions
Development and Land Summary ..................................................................................................................................... Attachment 9
Redevelopment Summary ............................................................................................................................................... Attachment 10
Unconsolidated Summary ............................................................................................................................................ Attachment 11(A)
Developer Capital Program ......................................................................................................................................... Attachment 11(B)
Acquisitions, Dispositions and Developer Capital Program Investments Summary ......................................................... Attachment 12
Capital Expenditure and Repair & Maintenance
Capital Expenditure and Repair and Maintenance Summary .......................................................................................... Attachment 13
Company Guidance
2Q 2022 and Full-Year 2022 Guidance ........................................................................................................................... Attachment 14
Definitions and Reconciliations
Defined Terms and Reconciliations ............................................................................................................... Attachments 15(A) -15(D)
Press Release
DENVER, CO - April 26, 2022
Contact: Trent Trujillo Email:ttrujillo@udr.com
UDR ANNOUNCES FIRST QUARTER 2022 RESULTS AND INCREASES FULL-YEAR 2022 GUIDANCE RANGES
UDR, Inc. (the "Company") (NYSE:UDR), announced today its first quarter 2022 results. Net Income, Funds from Operations ("FFO"), FFO as Adjusted ("FFOA"), and Adjusted FFO ("AFFO") per diluted share for the quarter ended March 31, 2022 are detailed below.
Quarter Ended March 31
1Q 2022 | 1Q 2022 | 1Q 2021 | $ Change vs. | % Change vs. | |
Metric | Actual | Guidance | Actual | Prior Year Period | Prior Year Period |
Net Income per diluted share | $0.04 | $0.02 to $0.04 | $0.01 | $0.03 | 300% |
FFO per diluted share | $0.54 | $0.53 to $0.55 | $0.32 | $0.22 | 69% |
FFOA per diluted share | $0.55 | $0.53 to $0.55 | $0.47 | $0.08 | 17% |
AFFO per diluted share | $0.51 | $0.50 to $0.52 | $0.44 | $0.07 | 16% |
• Same-Store ("SS") results for the first quarter 2022 versus the first quarter 2021 and the fourth quarter 2021 are summarized below.
Concessions reflected on a cash basis:Concessions reflected on a straight-line basis:
Year-Over-Year | Sequential: | |||
("YOY"): 1Q 2022 | 1Q 2022 vs. | |||
SS Growth / (Decline) | vs. 1Q 2021 | 4Q 2021 | ||
Revenue | 10.8% | 1.8% | 9.8% | 2.1% |
Expense | 4.2% | 2.0% | 4.2% | 2.0% |
Net Operating Income ("NOI") | 14.0% | 1.7% | 12.6% | 2.1% |
Year-Over-Year | Sequential: |
("YOY"): 1Q 2022 vs. | 1Q 2022 vs. |
1Q 2021 | 4Q 2021 |
• The Company's weighted average SS physical occupancy for the first quarter of 2022 was 97.3 percent, compared to 96.3 percent for the first quarter of 2021 and 97.1 percent for the fourth quarter of 2021.
• As previously announced, during the quarter, the Company entered intoforward equity sale agreements for 7.0million shares of common stock at an initial forward price per share of approximately $57.57 for estimated future net proceeds of approximately $402.8 million, subject to adjustment as described later in this release. No shares under these forward sale agreements have been settled.
• During the quarter, the Company committed to, and fully funded, an $11.6 million Developer Capital Program ("DCP") investment, realized the redemption of two DCP investments that generated life-to-date proceeds totaling $91.2 million on a total investment of $58.3 million, commenced two developments with an aggregate cost of approximately $187.5 million, and entered into an agreement to acquire a land site in Southeast Florida for future development for $16.0 million.
• During the quarter, the Company committed to invest an aggregate of $35.0 million into the RET Strategic Fund and two Climate Technology Funds, of which $13.2 million was contributed as of quarter end. Subsequent to quarter-end, the Companycommitted to invest $10.0 million in the RET Ventures ESG Fund.The Climate Technology and ESG funds serve to identify in-home and property-wide real estate technologies that are intended to help UDR, its residents, and others address climate change by reducing our collective carbon footprint. These investments further support UDR's best-in-class commitment to engaging in socially responsible Environmental, Social, and Governance ("ESG") activities.
"Our first quarter earnings results compare very well versus initial expectations provided in February due to operating fundamentals that have remained robust and continue to surprise to the upside," said Tom Toomey, UDR's Chairman and CEO. "Based on these current trends and the innovative operating initiatives we continue to implement, we raised full-year 2022 guidance expectations, further exemplifying the ongoing value our team creates for our stakeholders in what was already expected to be one of the best years in UDR's history."
Outlook
For the second quarter of 2022, the Company has established the following earnings guidance ranges and the Company has increased its previously provided full-year 2022 Same-Store and earnings guidance ranges(1):
Q2 2022 | Q1 2022 |
Outlook | Actual |
Net Income / (Loss) per diluted share $0.04 to $0.06 | $0.04 |
$0.54 | |
$0.55 | |
$0.51 | |
Updated |
Full-Year 2022 |
Outlook |
$0.24 to $0.30 |
$2.24 to $2.30 |
$2.25 to $2.31 |
$2.05 to $2.11 |
YOY Growth/(Decline): concessions reflected on a cash basis: |
8.5% to 10.0% |
3.0% to 4.0% |
FFO per diluted share FFOA per diluted share AFFO per diluted share
$0.55 to $0.57 $0.55 to $0.57 $0.50 to $0.52
SS Revenue SS Expense SS NOI
N/A N/A N/A
YOY Growth/(Decline): concessions reflected on a straight-line basis:
SS Revenue SS NOI
N/A N/A
Prior | Change to 2022 | |
Full-Year 2022 | Guidance, at | |
Outlook | Midpoint | |
$0.22 to $0.30 | $0.01 | |
$2.22 to $2.30 | $0.01 | |
$2.22 to $2.30 | $0.02 | |
$2.02 to $2.10 | $0.02 | |
6.5% to 8.5% | 1.75% | |
2.5% to 3.5% | 0.50% | |
14.0% 10.75% to 12.75% | 8.5% to 11.5% | 1.75% |
7.5% to 9.5% | 1.25% | |
9.5% to 12.5% | 1.50% |
10.8% 4.2%
9.8% 12.6%
9.0% to 10.5% 11.5% to 13.5%
(1)
Additional assumptions for the Company's second quarter and 2022 outlook can be found on Attachment 14 of the Company's related quarterly Supplemental Financial Information ("Supplement"). A reconciliation of FFO per share, FFOA per share, and AFFO per share to GAAP Net Income per share can be found on Attachment 15(D) of the Company's related quarterly Supplement. Non-GAAP financial measures and other terms, as used in this earnings release, are defined and further explained on Attachments 15(A) through 15(D), "Definitions and Reconciliations," of the Company's related quarterly Supplement.
Recent Operating Trends
"Strong pricing power, as evidenced by blended lease rate growth that continued to accelerate to the mid-to-high teens into the second quarter, continues to provide a robust tailwind for UDR's elevated same-store growth," said Mike Lacy, UDR's Senior Vice President of Operations. "In addition, future growth prospects remain attractive, driven by healthy demand for multifamily residences, seasonally strong market rent growth, record low resident turnover, a low-double-digit loss-to-lease, and occupancy above 97 percent."
Summary of Fourth Quarter 2021, First Quarter 2022, and April 2022 Residential Operating Trends(1)
As of and Through April 22, 2022
4Q | Jan | Feb | Mar | ||
Same-Store Metric | 2021 | 2022 | 2022 | 2022 | |
Weighted Average Physical Occupancy | 97.1% | 97.4% | 97.2% | 97.3% | 97.3%97.0% - 97.3% |
Effective Blended Lease Rate Growth(2) | 11.7% | 13.1% | 14.0% | 14.9% | 14.1%16.0% - 17.0% |
Q1 2022
Apr 2022
(1) Metrics shown here are as of April 22, 2022, and are for the Company's same-store residential portfolio.
(2) The Company defines Effective Blended Lease Rate Growth as the combined proportional growth as a result of (a) Effective New Lease Rate Growth and (b) Effective Renewal Lease Rate Growth. Management considers Effective Blended Lease Rate Growth a useful metric for investors as it assesses combined proportional market-level new and in-place demand trends. Please refer to the "Definitions and Reconciliations" section of the Company's related quarterly Supplement for additional details.
Since the second quarter of 2020 (or the first full quarter in which results were impacted by the COVID-19 pandemic), the Company has consistently achieved ultimate cash revenue collections as a percentage of billed revenue in the 98.0%-98.5% range and expects collections to remain within this range throughout 2022. For the first quarter of 2022, the Company reduced its residential bad debt reserve to $11.9 million, including $0.6 million for the Company's share from unconsolidated joint ventures, which compares to a quarter-end accounts receivable balance of $24.4 million.
First Quarter 2022 Operating Results
In the first quarter, total revenue increased by $55.8 million YOY, or 18.5 percent, to $357.3 million. This increase was primarily attributable to growth in revenue from Same-Store communities and stabilized, non-mature communities. The first quarter annualized rate of resident turnover decreased by 530 basis points versus the prior year period to 34.2 percent.
In the table below, the Company has presented YOY Same-Store results by region, with concessions accounted for on both cash and straight-line bases.
Summary of Same-Store Results in First Quarter 2022 versus First Quarter 2021
Region | Revenue Growth / (Decline) | Expense Growth / (Decline) | NOI Growth / (Decline) | % of Same-Store Portfolio(1) | Physical Occupancy(2) | YOY Change in Occupancy |
West Mid-Atlantic Northeast Southeast Southwest Other Markets | 11.8% 6.9% 10.6% 14.0% 11.2% 13.4% | 3.7% 5.3% 2.4% 6.2% 4.6% 4.3% | 14.8% 7.7% 15.9% 18.0% 15.4% 17.3% | 34.9% 21.0% 18.1% 13.0% 7.0% 6.0% | 97.2% 97.3% 97.4% 97.3% 97.3% 97.2% | 1.4% 0.9% 2.2% 0.2% 0.4% 0.2% |
Total (Cash) | 10.8% | 4.2% | 14.0% | 100.0% | 97.3% | 1.0% |
Total (Straight-Line) | 9.8% | - | 12.6% | - | - | - |
(1) Based on 1Q 2022 Same-Store NOI. For definitions of terms, please refer to the "Definitions and Reconciliations" section of the Company's related quarterly Supplement.
(2) Weighted average Same-Store physical occupancy for the quarter.
In the table below, the Company has presented sequential Same-Store results by region, with concessions accounted for on both cash and straight-line bases.
Summary of Same-Store Results in First Quarter 2022 versus Fourth Quarter 2021
Region | Revenue Growth / (Decline) | Expense Growth / (Decline) | NOI Growth / (Decline) | % of Same-Store Portfolio(1) | Physical Occupancy(2) | Sequential Change in Occupancy |
West Mid-Atlantic Northeast Southeast Southwest Other Markets | 0.7% 1.0% 2.8% 4.3% 1.6% 1.6% | (0.2)% 3.7% 1.7% 5.4% 3.4% (3.8)% | 1.0% (0.1)% 3.4% 3.7% 0.5% 3.7% | 34.9% 21.0% 18.1% 13.0% 7.0% 6.0% | 97.2% 97.3% 97.4% 97.3% 97.3% 97.2% | 0.3% 0.2% 0.5% (0.2)% (0.2)% (0.3)% |
Total (Cash) | 1.8% | 2.0% | 1.7% | 100.0% | 97.3% | 0.2% |
Total (Straight-Line) | 2.1% | - | 2.1% | - | - | - |
(1) Based on 1Q 2022 Same-Store NOI. For definitions of terms, please refer to the "Definitions and Reconciliations" section of the Company's related quarterly Supplement.
(2) Weighted average Same-Store physical occupancy for the quarter.
Development Activity and Other Projects
During the first quarter, the Company delivered initial apartment homes at Cirrus (Denver, CO), The George Apartments (King of Prussia, PA), and Vitruvian West Phase 3 (Addison, TX), all of which continue their successful lease-ups. Additionally, during the quarter, the Company commenced construction of Villas at Fiori, a $53.5 million, 85-home townhouse community in Addison, TX, and Meridian, a $134.0 million, 330-home community in Tampa, FL.
At the end of the first quarter, the Company's development pipeline totaled $689.0 million and was 66.5 percent funded. The Company's active development pipeline includes seven communities, one each in Denver, CO; Dublin, CA; King of Prussia, PA; Washington, D.C.; and Tampa, FL, and two communities in Addison, TX, for a combined total of 1,832 homes.
At the end of the first quarter, the Company's pipeline of densification projects, which features the addition of 58 new apartment homes at three communities, totaled $27.0 million and was 53.2 percent funded.
DCP Activity
During the quarter, the Company committed to invest, and fully funded, $11.6 million in one DCP project, a recapitalization of a stabilized operating community, as summarized below.
Community | Location (MSA) | Commitment ($ millions) | Homes | Return Rate | Investment Type |
Meetinghouse | Portland, OR | $11.6 | 232 | 8.25% | Preferred Equity |
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UDR Inc. published this content on 26 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 April 2022 20:34:05 UTC.
