Apartment REITs began to go on the offense in the first quarter of 2024 after spending the latter part of 2023 building their occupancy in the face of new competition, with many of them beating their guidance and analysts’ expectations for the period.
For instance, Arlington, Virginia-based REIT AvalonBay Communities’ core funds from operations of $2.70 per share beat consensus by five cents, powered by higher-than-expected net operating income and joint venture income. With the stronger-than-expected performance, the REIT’s management team upgraded its same-store revenue growth guidance by 50 basis points to 3.1% for 2024.
AVB, like the six other largest apartment REITs, reported robust rent growth for renewals, as many residents chose to stay in their homes in the face of rising interest rates driving up the cost of homeownership.
Chicago-based Equity Residential saw an all-time low of just 7.2% of its residents moving out to buy homes. However, new lease growth was still an issue for companies with portfolios in markets with a lot of new apartment deliveries. For instance, Memphis-based MAA saw new lease rents down 6.2%, though its renewals grew 5%.
“Pricing trends for new resident move-ins continue to reflect the impact from new supply delivering in several of our markets,” MAA CEO Eric Bolton said on his company’s Q1 earnings call.
Read on for more highlights from recent earnings calls and releases.
