BRT Apartments (BRT) 8 Nov 222022 Q3 Earnings call transcript

Good day, and welcome to the BRT Apartments Corporation third quarter 2022 earnings conference call. Today’s conference is being recorded. At this time, I’d like to turn the floor over to Mr. Kevin Reed of ICR. Thank you, sir, and you may now begin.

us conference BRT call. joining quarter Corp.'s for earnings XXXX you today Apartment for third Thank

Zweier, Ryan On President David Officer. George and call Kalish, Chief Financial the today Executive Also is Senior Vice available Officer; Chief Operating Baltimore, Jeffrey President. Gould, Chief and Officer; are

its multifamily share portfolio assets its SEC. wholly-owned to unconsolidated limitations indicated, NOI, information and with pro pro the or refer presented today including with in and or requires, unconsolidated Except and and call current that the are Listeners would Litigation company's measures, our including Private BRT does forward-looking release, information subsidiaries. required beliefs. revenues, undertake otherwise I conference filings, Reform to expectations, to with and includes are within regarding XX-Q, earnings undue of of of statements Act expenses, statements. share any by any the the and Form Unless data and of of NOI, everyone caution not remind in risks results our revenues, update reported forward-looking also publicly call like All and obligation XXXX based encouraged forward-looking non-GAAP for and BRT's a statements. a in the non-GAAP Securities other FFO, any NOI, management's certain rata on the BRT's BRT's assumptions, factors liabilities, SEC used AFFO, this has of assets discussion affect of to place on not subsidiaries. that contains filings and or as Form meaning complete This could GAAP revise discussion context its otherwise review rata should references subsidiaries, to law, be liabilities of discussed reliance conjunction more our that supplemental and and references accounts to expenses, portfolio, XX-K to forward-looking statements, these

website We As a Form on earnings that www.brtapartments.com. at our Investor release reminder, supplemental filed will XX-Q of quarterly today. on Relations later been information and have anticipate the company's posted BRT's be the section report

like Jeff. over President Gould. to the ahead, Please, Jeffrey to now go I'd and turn call CEO,

welcome call. you, Thank the to and

We are quarter strong operational acquisitions joint through deliberate consistent across had we share portfolio. portfolio our over year has that strong our BRT have to quarterly partners’ pleased another to venture resulted in and our used interests, the past approach grow of results. The

XXXX, with Our in and growing maturities near-term is until an quality with a increasingly comprised significant to hedge no located and strong providing markets, mortgage fixed-rate is macroeconomic portfolio BRT debt property of backdrop. uncertain weather

prudent in have been in planning growing which our our stands at execution wholly-owned our XX and properties. judicious portfolio, We in currently

evolves. Going and forward, interest markets rates rise carefully we pricing as watching are

that in disciplined our underwriting will remain quality to identify As always, properties and standards. we meet process our

We through and they of current broader the believe BRT the will and there advantage have been cycles economy, do. dislocation that them lead uncertainty before, opportunities, will we take when be to to and in

of general is AFFO by per was common stockholders $X.XX income larger $X.XX to the partners incremental in in The increase compared improved share XXXX. and Turning and diluted property per or quarter $X.XX $X.XX $XX.XX share and to per is of to share, across XXXX. per to The at The attributable expense. same third the primarily diluted million expenses, tax increase was primarily in change per year. net share $X.XX in to due compared results on unconsolidated of corresponding share, to was operating or the or million the portfolio, diluted of increased in offset third or due margins quarter for XXXX, million diluted quarter our prior an sale AFFO a the the $X.XX income impact administrative $X.XX million buyouts. gain period our

communities XX our of at units. XX, portfolio containing wholly-owned portfolio, to our consists XXXX, September Turning X,XXX multifamily

We for ended unconsolidated XXXX quarter XX, compared up also eight portfolio own interest for Average in through occupancy per the the $X,XXX the quarter. units. to entities the as quarter September rents the XX.X% XXXX, was unchanged X,XXX compared in were to quarter. portfolio for communities XX% another totaling the XXXX monthly third Average month, XXXX

third of overall owned new For joint spreads renewal leases which the unconsolidated for we leases in of pool favorable and XX.X%. on and by spreads the our consolidated, were of same-store third In X,XXX the at were X,XXX included X,XXX quarter spreads XXXX, signed units, XX.X%, saw of quarter XXXX, XX.X%, portfolio ventures.

grew same-store X.X%, the XX.X% same-store increased from in revenue XXXX quarter. each same-store For these grew case expenses and by properties, XX.X%, NOI

transactions in made been partner in growth pleased disciplined and are our we have Regarding with earlier our plans, very year. year-to-date, the buyouts

of held an the share share multifamily from prepayment IRR million, $XX.X years an million. were interest and spreads equity used down be in gain charge generated environment and $XX.X Carolina, to recycling insight XXX-unit the We in rising volumes, less our pay that Harbison, and ventures industry of transaction approximately quarter, owned, in sold which community macroeconomic unconsolidated Columbia, resulted credit of in third XX% managing the a the our portfolio in rates. our more that proceeds cap as has South approximately true given facility. discipline the was continued BRT’s for mortgage third and BRT’s we quarter, joint to bid-ask the Waters the to interest was XX% owned rates, selectively into opportunistic have the it from property over the $XXX,XXX. BRT the uncertain, decreased at Staying capital, widening sale and six BRT grown Edge was

of buyouts million, properties the purchase X,XXX BRT completed at price the announced of for five for In XX XXXX, aggregate quarter of partner third $XXX.X properties. total the an partner XXXX, previously units. In at consisting completed buyouts BRT

amount quarter matured, and end, BRT. the As facility. credit of XX, to $XXX our of the purchases, mortgage these off Subsequent are a Oaks Savannah result million paid of the the properties borrowing wholly-owned debt debt from $XX.X and end recently million stockholder Available these equivalents, on September approximately was and completion property of of under in available cash by At all had cash by $XX of credit million, our facility. and we included quarter BRT $XXX of million. million, XXXX, at to up $XX $XXX liquidity amended million total total total assets equity

working had is and equivalents, In ventures addition, approximately million purposes the ventures renovations. cash capital applicable used joint our unconsolidated cash of and which day-to-day $XX for

was of mortgage September debt $XX XX under for available at to XXXX, The of our joint comprised X, combined and November average of our ventures, our with cash share $XXX.X $XX and a credit facility. average for to wholly-owned available million, debt as aggregate properties, equivalents, rata term million remaining mortgage $XX maturity At interest weighted pro X.X rate up approximately liquidity our and weighted of cash million, million totals our of years. a X.XX%, unconsolidated with

were with leverage share sales of quarter, in We improved the ATM our XXXX. of approximately for proceeds average our quarter, September to XX% the and we XXXX, focus $XX.XX. amount million, can that of on expenses floor our our XX, we capital used increased rate weighted extended at flexibility we million. Also, the among prime and we XXXX, to $X.X rate borrow to by million, utilizing down amount at continue a to September ratios, the enhanced strengthened the to and enterprise from XX, the amending value XXX,XXX our per approximately as program as reduced XX%, the which, price Net debt to be may a X.X%. working other $XX the credit shares, increased to In facility $XX sold facility, third term operating financial interest things, September of

as from per prior dividend of quarterly yield Finally, equates dividend. quarterly on The November an our on of unchanged X, stock business X.X% of October on we a the price share, the of X, XXXX, of to XXXX. paid close based annualized dividend $X.XX $XX.XX current

conclude, To themselves. with position as present well capitalize are on to and our we opportunities to they to progress ourselves continue date, made pleased

definitely but the and value with many today's capital sheet. enhanced the confidence disciplined population our create to We navigate stockholders. have we’ll regarding long-term gives that us environment strategy, inflationary our been for prudent our The acquisition continue have across our growth job and ability markets, sustainable allocation also and comfort to of with ongoing balance

to And on As successes. thank to team BRT for and behalf want your BRT the entire their always, I and team, of our contribution for I continued of myself Apartments. the thank continued work you hard support to want

Operator? That call your will open completes for questions. We our call. now the

Gaurav [Operator Instructions] comes ahead, First Hutton. go Please you. from Mehta of sir. question Thank EF

of rates cap up was provide What Yes, you if rates gone thanks. have market. the Good wondering interest on markets? movement some transaction in your color I have kind seen in you morning. as could

well, down have but transactions slowed transactions almost volume so a wouldn't I has of halt, say past. from to years Yes. come The Hi, Yes, way way, the Gaurav. - considerably. of amount it's

going again that and the I'd the bid and because rates time for seen think say understand But cap what's pricing to months sellers to caps real happened bid basis seen the digest have where about being, to rates months. the amount understand ascertain points, for a sellers to and acknowledge. so for is think is world XXX it's sellers that I process And ask happened time not on. take high, from to it's some as to time a take closed moved few of are at period going going have some interest more, going rise, I since We've with this few them now. time least rates cap of deals And of the minimum. where difficult to is the think I if be actually few understand we've the last to be at to getting deals the of getting of over

you to or can you to terms able the you Okay. much tenants? weakness seen push still at Maybe have rents, your of push rents all operation on side, how any in are

would the still Still positive able for been we've rents has that we're, been and I and say we've amount continue bit increase slowed which at to to which velocity push a terrific. at the rents. able the Yes, to sure. very little

seeing over nine maybe matter longer extent not than was bit. fact, of drop year, to that expected. but the but were months. it a thought increases, slow same still to a to I of I time going six lasted to nice very occupancies little we tend had earlier it last it the This As that down did, than had

to a as positive, asking but over Our not the well, few you as but just still getting last rents the quarters. turnover seems are drop to were bit the increase same extent little crazy

the And six to compared lastly to maybe renovations year to would you doing if expect months rent down growth nine next in Okay. as slowed side, the continue on renovation has ago?

Yes, we actively in our on ourselves involving of individual plan units. renovations still

bought we units We increase some of as terrific. I investment these for think think opportunity return over out there's up that and actually the the are of course significantly, renovated pretty the year. partners past may tick the on to rents

- So, that to I to more we'll as to increase do can great anticipate we do continue a and because cashflow. it's probably as many opportunity do hope

I That's had. you. all Thank Okay,

[Operator Kucera next instructions]. Please be go Riley you B. one Thank And Securities. Craig of will question from ahead.

thanks. Good a third guys. you side, of the in bit pretty half start third the I that but about challenges to had same-store clearly first expense ability to Yes, here operating your year, want changed in on quarter. first talking rents, the think in the strong here kind quarter, but morning, the I a push more Clearly, of NOI.

Is were expenses that your so. in there I up attribute maybe to? you anything X% or that think particular

had the seeing definitely cetera. increases and more But expenses as would were shares those seeing some favorable, the those, and because light, expense insurance, generally specific and little tax would benefits mean, tax low yes, side seeing shares payroll, increases think We're of things favorable we say in definitely contributed expenses. we're the - the on I were we I with some - primarily And utilities, a booking properties, we've I which was as some Yes, they why are the of - that. I et of to were.

they're people kind to to new properties where maybe marginally your prior, the have maybe for do renters are leases down price Okay, you determine relative from? just surveys renters to and that coming that higher to sense sort that or any curious, the And do you trading other from have pretty spreads thanks any income-type in they're coming wide of try rentals, coming of higher signing you as that.

of we continued that say creep huge can flow that, - what the everything ours. think pay - I necessarily have - migration don't to been a et delinquencies you migration track trying issue, renters. a B months may wouldn't the migrating seeing from to workforce over there with I we to we're start been theme. now. Yes, plus, bit can we to see bit I of we we're end else wouldn't properties. in surprised and track but but What or have tell it's been of those And that packages noticed and - the a of cetera. and a we're pretty down doing pretty fortunately, I bit but specifically to - But seen from not we've - have be a we've little people affordability factor from It's But little not stable housing something more we the have few A been is more, now consistent would either higher more the some of noticed is a minus quality last supply I concern A amended an to and A have. kind low,

we're and probably a we of on see an next quarter, wouldn't eye So, that. more do keeping have surprising better for if it, be but it answer you

it. Appreciate Thanks. Okay.

to I'd remarks. Mr. question-and-answer back turn for our session. concludes over like closing conference to This Gould the

to continued again great a you want all hope you thank have and speak for soon. time in we'll I your this BRT. and your just I morning all day, interest

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

disconnect. now may You