Independence Realty Trust Inc (IRT) 2023 Q3 法說會逐字稿

Good morning. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the Independence Realty Trust Q3 2023 Conference Call.

早安.我叫奧德拉，今天我將擔任你們的會議操作員。此時此刻，我謹歡迎大家參加獨立房地產信託 2023 年第三季電話會議。

Today's conference is being recorded.

今天的會議正在錄製中。

(Operator Instructions)

（操作員說明）

At this time, I would like to turn the conference over to Lauren Torres. Please go ahead.

這次，我想把會議交給勞倫·托雷斯。請繼續。

Thank you, and good morning, everyone. Thank you for joining us to review Independence Realty Trust's Third Quarter 2023 Financial Results.

謝謝大家，大家早安。感謝您與我們一起回顧 Independence Realty Trust 2023 年第三季財務業績。

On the call with me today are Scott Schaeffer, Chief Executive Officer; Mike Daley, EVP of Operations and People; Jim Sebra, Chief Financial Officer; and Janice Richards, SVP of Operations.

今天與我通話的是執行長 Scott Schaeffer； Mike Daley，營運與人員執行副總裁；吉姆‧塞布拉，財務長；和營運資深副總裁 Janice Richards。

Today's call is being webcast on our website at irtliving.com. There will be a replay of the call available via webcast on our Investor Relations website and telephonically, beginning at approximately 12:00 p.m. Eastern Time today.

今天的電話會議正在我們的網站 irtliving.com 上進行網路直播。將於中午 12:00 左右開始透過我們的投資者關係網站上的網路廣播和電話重播電話會議。今天東部時間。

Before I turn the call over to Scott, I'd like to remind everyone that there may be forward-looking statements made on this call. These forward-looking statements reflect IRT's current views with respect to future events and financial performance.

在我將電話轉給史考特之前，我想提醒大家，這次電話會議可能包含前瞻性陳述。這些前瞻性陳述反映了 IRT 目前對未來事件和財務表現的看法。

Actual results could differ substantially and materially from what IRT has projected. Such statements are made in good faith pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Please refer to IRT's press release, supplemental information and filings with the SEC for factors that could affect the accuracy of our expectations or cause our future results to differ materially from those expectations. Participants may discuss non-GAAP financial measures during this call. A copy of IRT's earnings press release and supplemental information containing financial information, other statistical information and a reconciliation of non-GAAP financial measures to the most direct comparable GAAP financial measure is attached to IRT's current report on the Form 8-K, available at IRT's website under Investor Relations.

實際結果可能與 IRT 的預測有重大差異。此類聲明是根據1995 年《私人證券訴訟改革法案》的安全港條款善意做出的。請參閱IRT 的新聞稿、補充資訊以及向SEC 提交的文件，了解可能影響我們預期的準確性或導致我們的預期準確性的因素。未來的結果與這些預期有重大差異。參與者可以在本次電話會議期間討論非公認會計原則財務措施。 IRT 的收益新聞稿副本和補充資料包含財務資訊、其他統計資料以及非 GAAP 財務指標與最直接可比較 GAAP 財務指標的調整表，附在 IRT 目前的 8-K 表格報告中，可在 IRT 網站取得投資者關係下的網站。

IRT's other SEC filings are also available through this link. IRT does not undertake to update forward-looking statements on this call or with respect to matters described herein, except as may be required by law. With that, it's my pleasure to turn the call over to Scott Schaeffer.

IRT 的其他 SEC 備案文件也可透過此連結取得。 IRT 不承諾更新本次電話會議或本文所述事項的前瞻性陳述，除非法律要求。至此，我很高興將電話轉給史考特·謝弗。

Thank you, Lauren, and thank you all for joining us this morning. On our last earnings call, we specifically noted 4 areas of focus at IRT, drive occupancy, deliver planned value-add improvements, further manage our cost structure and reduce our (inaudible). Since then, we have made progress on each of these fronts and have recognized ways to further optimize our portfolio, which will accelerate our deleveraging and better position IRT for the future. Let me take them one by one.

謝謝勞倫，也謝謝大家今天早上加入我們。在我們上次的財報電話會議上，我們特別指出了 IRT 的 4 個重點領域：提高入住率、實現計劃的增值改進、進一步管理我們的成本結構並減少（聽不清楚）成本。從那時起，我們在這些方面都取得了進展，並找到了進一步優化我們投資組合的方法，這將加速我們的去槓桿化進程，並為 IRT 的未來提供更好的定位。讓我一一拿來。

First, our same-store occupancy in the third quarter improved 40 basis points to 94.6% on both a year-over-year and sequential basis, reflecting our team's ability to continue to implement operational enhancements; second, we continue to invest in our communities, particularly through our value-add renovation program, where we renovated 709 units in the third quarter and 1,969 units in the first 9 months of 2023, achieving an un-levered return on investment of 16%; third, we continue to better manage our cost structure by reducing overhead costs by $2 million this year as compared to our original guidance issued in February. This is in addition to the $2.5 million in annual savings associated with the centralization of resident services and sales performance management teams. Looking into 2024, we are rolling out several new technology initiatives that will create further efficiencies; and fourth, we are now announcing a program to accelerate the sale of noncore properties and immediately delever more on this strategy in a minute.

首先，我們第三季的同店入住率年比和季比均提高了 40 個基點，達到 94.6%，反映了我們團隊繼續實施營運改善的能力；其次，我們繼續投資於我們的社區，特別是透過我們的增值翻新計劃，我們在第三季度翻新了709 個單元，在2023 年前9 個月翻新了1,969 個單元，實現了16% 的無槓桿投資報酬率;第三，與 2 月發布的原始指導相比，今年我們將管理費用減少了 200 萬美元，從而繼續更好地管理我們的成本結構。除此之外，由於駐地服務和銷售績效管理團隊的集中化，每年還可節省 250 萬美元。展望 2024 年，我們將推出多項新技術舉措，以進一步提高效率；第四，我們現在宣布一項計劃，以加速非核心資產的銷售，並立即立即進一步落實該策略。

While we remain encouraged by our strategic initiatives to support continued growth at IRT, we and other multifamily operators are facing an increasingly challenging environment. Specifically, we have seen a slower rate of occupancy gains than expected due to the softening economic environment, along with pricing pressure as new supply is offering aggressive concessions. These factors are affecting some of our markets such as Atlanta, Dallas and Nashville.

儘管我們對支持 IRT 持續成長的策略性舉措感到鼓舞，但我們和其他多戶住宅營運商面臨著日益嚴峻的環境。具體來說，由於經濟環境疲軟，以及新供應大幅讓步而帶來的定價壓力，我們發現入住率成長速度低於預期。這些因素正在影響我們的一些市場，例如亞特蘭大、達拉斯和納許維爾。

So as a result of these recent trends, we are adjusting our 2023 guidance. Jim will provide greater detail behind our guidance update later on this call. We firmly believe that our core markets are well positioned to continue to see strong absorption in multi-family units. Further, we will continue to benefit from our market diversification, in affordable, defensive middle-market communities that are more resilient, but not immune to current elevated supply pressure.

因此，由於最近的這些趨勢，我們正在調整 2023 年的指導。吉姆將在稍後的電話會議上提供有關我們的指導更新的更多詳細資訊。我們堅信，我們的核心市場處於有利位置，將繼續看到多戶單位的強勁吸收。此外，我們將繼續受益於我們的市場多元化，在負擔得起的、防禦性的中間市場社區，這些社區更具彈性，但也不能免受當前供應壓力上升的影響。

While we work to navigate the current environment, we must also think strategically to ensure that we are well positioned for the future. Accordingly, we are initiating our portfolio optimization and deleveraging strategy, which is focused over the near term on reducing our presence in noncore markets, while also significantly deleveraging our balance sheet. We are accelerating this plan due to the broad view that interest rates will remain higher for longer, which will continue to impact property values.

在我們努力應對當前環境的同時，我們也必須進行策略思考，以確保我們為未來做好準備。因此，我們正在啟動投資組合優化和去槓桿化策略，該策略的重點是在短期內減少我們在非核心市場的存在，同時大幅去槓桿化我們的資產負債表。我們正在加速這項計劃，因為人們普遍認為利率將在更長時間內保持在較高水平，這將繼續影響房地產價值。

Our plan is to sell 10 noncore properties with the proceeds used to immediately reduce debt. The plan reduces near-term maturities and better positions IRT for an investment-grade rating. Before handing the call over to Mike, I'd like to stress our continued confidence in our core markets where demand fundamentals remain favorable and supply pressure should begin to abate over the next 6 to 12 months. We expect to continue to benefit from positive migration, demographic and employment trends. This is a core strength to the IRT portfolio and will position us favorably going forward. I'd now like to turn the call over to Mike.

我們的計劃是出售 10 處非核心房產，所得收益用於立即減少債務。該計劃減少了近期期限，並為 IRT 提供了更好的投資等級評級。在將電話轉交給麥克之前，我想強調我們對核心市場的持續信心，這些市場的需求基本面仍然有利，供應壓力將在未來 6 至 12 個月內開始減弱。我們預計將繼續受益於積極的移民、人口和就業趨勢。這是 IRT 產品組合的核心優勢，將使我們在未來的發展中處於有利地位。我現在想把電話轉給麥克。

Thanks, Scott. As Scott mentioned and has been noted by other companies and multifamily economists, we are operating in a challenging environment with the impact of new supply and the impact of inflation on consumers. These factors have led to more options for renters in the near term and higher sensitivity to price than we've seen in recent years. This has created headwinds for us and for the industry. Despite these challenges in the third quarter, we delivered a same-store average occupancy rate of 94.6%, a 40 basis point increase on a quarter-over-quarter and year-over-year basis and a 150 basis point increase from Q1 of this year.

謝謝，斯科特。正如斯科特所提到的，以及其他公司和多戶經濟學家所指出的，我們正處於一個充滿挑戰的環境中，受到新供應的影響以及通貨膨脹對消費者的影響。這些因素導致租屋者在短期內有更多的選擇，並且對價格的敏感度比我們近年來看到的更高。這給我們和整個行業帶來了阻力。儘管第三季面臨這些挑戰，我們的同店平均入住率仍達到 94.6%，環比和同比增長 40 個基點，較一季度增長 150 個基點。年。

As of today, our same-store occupancy is 94.6%, and our same-store non-value-add occupancy is 95%. Our portfolio average rental rate increased 4.4% in Q3, contributing to 5.4% year-over-year property revenue growth for the quarter. New lease rent growth in Q3 reflected changing market conditions with new lease rates of 80 basis points higher. This includes the impact of concession activity to counter those conditions.

截至目前，我們的同店入住率為 94.6%，同店非增值入住率為 95%。第三季度，我們的投資組合平均租金成長了 4.4%，推動該季度房地產收入年增 5.4%。第三季新租賃租金成長反映了市場狀況的變化，新租賃費率上漲了 80 個基點。這包括為應對這些情況而進行的特許活動的影響。

In the third quarter, we increased the use of concessions, especially in markets, such as Atlanta and Dallas to remain competitive and to prioritize occupancy. Lease-over-lease effective rent growth for renewals in Q3 2023 was 4.8%. And in Q4 2023, to date, is 5%, which reflects approximately 82% of our total expected Q4 lease renewals. Our Q4 2023 today blended lease-over-lease effective rental rate growth is 2.3%. We continue to achieve double-digit NOI growth in the third quarter in a number of markets, including Houston, Tampa, Louisville and Lexington. These markets have displayed increases in average monthly rent, benefiting from strong job markets.

第三季度，我們增加了優惠的使用，特別是在亞特蘭大和達拉斯等市場，以保持競爭力並優先考慮入住率。 2023 年第三季續租的租賃有效租金成長率為 4.8%。迄今為止，2023 年第四季為 5%，約占我們預期第四季續租總數的 82%。今天，我們的 2023 年第四季混合租賃有效租金成長率為 2.3%。第三季度，我們在休士頓、坦帕、路易斯維爾和列剋星敦等多個市場繼續實現兩位數的 NOI 成長。受益於強勁的就業市場，這些市場的平均月租金增加。

We continue to focus on driving operational performance through process improvement, role specialization and ongoing technology enhancements. These initiatives include a pilot program to build on organizational improvements that have increased the speed of our response to local market changes. Another example is in the screening and qualification process for new residents. Across the industry, efforts to ensure screening effectiveness and to fight fraud are a high priority.

我們繼續專注於透過流程改善、角色專業化和持續的技術增強來提高營運績效。這些措施包括以組織改進為基礎的試點計劃，提高了我們對當地市場變化的反應。另一個例子是新居民的篩選和資格審查過程。在整個行業中，確保篩檢有效性和打擊詐欺是當務之急。

We are deploying new technology solutions to improve the accuracy and confidence of prospect ID verification and are preparing to deploy a new robust income verification solution in early 2024. We expect these technology enhancements will improve the speed and effectiveness of resident screening. In addition, our specialized teams focused on sales and resident's account management have had a positive impact on staffing efficiency, resident experience and reputation, streamlining the collections process and greater efficiency and focus for our community teams. As we look ahead, our focus is on prioritizing occupancy throughout our portfolio, while optimizing rent growth where possible. Our results in Q3 show the success of our initiatives, and we will continue to explore opportunities to increase efficiencies and drive results.

我們正在部署新技術解決方案，以提高潛在身份驗證的準確性和可信度，並準備在2024 年初部署新的強大的收入驗證解決方案。我們預計這些技術增強將提高居民篩檢的速度和有效性。此外，我們專注於銷售和居民帳戶管理的專業團隊對員工效率、居民體驗和聲譽產生了積極影響，簡化了收款流程，並提高了社區團隊的效率和重點。展望未來，我們的重點是優先考慮整個投資組合的入住率，同時盡可能優化租金成長。第三季的結果顯示我們的措施取得了成功，我們將繼續探索提高效率和推動成果的機會。

I will now turn the call over to Jim.

我現在將把電話轉給吉姆。

Thanks, Mike, and good morning, everyone. Beginning with our third quarter 2023 performance. Net income available to common shareholders was $3.9 million as compared to $16.2 million in the third quarter of 2022. This decrease is a result of an asset impairment we recorded this quarter associated with the portfolio optimization and deleveraging strategies Scott mentioned.

謝謝麥克，大家早安。從我們 2023 年第三季的業績開始。普通股股東可獲得的淨利潤為390 萬美元，而2022 年第三季為1,620 萬美元。這一下降是由於我們本季記錄的與斯科特提到的投資組合優化和去槓桿化策略相關的資產減損所致。

During the third quarter, core FFO per share increased 7.1% to $0.30 per share from $0.28 per share a year ago. This growth reflects the organic rent and NOI growth that we experienced in the quarter on a year-over-year basis. IRT same-store NOI growth in the third quarter was 4.8%, driven by revenue growth of 5.4%. This growth was led by a 4.4% increase in average monthly rental rates to $1,549 per month. On the operating expense side, IRT same-store operating expenses increased 6.3% during the third quarter, led by higher property insurance and contract services due to inflation as well as higher advertising expenses as a result of our increased efforts to drive occupancy amid a slowing macroeconomic environment.

第三季度，核心 FFO 每股成長 7.1%，從一年前的每股 0.28 美元增加到每股 0.30 美元。這一增長反映了我們在本季度經歷的有機租金和 NOI 同比增長。在營收成長 5.4% 的推動下，第三季 IRT 同店 NOI 成長 4.8%。這一增長是由平均月租金上漲 4.4% 至每月 1,549 美元帶動的。在營運費用方面，第三季IRT同店營運費用成長了6.3%，其中通貨膨脹導致的財產保險和合約服務費用增加，以及我們在經濟放緩的情況下加強提高入住率導致廣告費用增加。宏觀經濟環境。

Turning to our balance sheet. As of September 30, our liquidity position was $276 million. We had approximately $17 million of unrestricted cash and $259 million of additional capacity through our unsecured credit facility. Before turning to 2023 guidance, I'd like to provide more details behind our newly initiated portfolio optimization and deleveraging strategy.

轉向我們的資產負債表。截至 9 月 30 日，我們的流動性部位為 2.76 億美元。我們擁有約 1,700 萬美元的無限現金和 2.59 億美元的額外產能，透過我們的無擔保信貸安排。在轉向 2023 年指導之前，我想提供我們新啟動的投資組合優化和去槓桿化策略背後的更多細節。

As Scott mentioned, we are focused on reducing our presence in noncore markets, while also delevering our balance sheet. In particular, we plan to sell 10 properties in 7 markets for estimated gross proceeds between $521 million and $533 million, which equates to a weighted average economic cap rate of approximately 5.9% at the midpoint. After repaying debt at the property level associated with the sold properties, we estimate that we will have between $232 million and $244 million of remaining proceeds and we'll use those remaining proceeds to repay unhedged floating rate borrowing and various other high-cost property mortgages that mature in 2024, 2025 and 2026.

正如史考特所提到的，我們專注於減少在非核心市場的存在，同時也去槓桿化我們的資產負債表。特別是，我們計劃在 7 個市場出售 10 處房產，預計總收益在 5.21 億美元至 5.33 億美元之間，相當於中點的加權平均經濟上限約為 5.9%。在償還與所售房產相關的房產層面的債務後，我們估計我們將擁有2.32 億至2.44 億美元的剩餘收益，我們將使用這些剩餘收益來償還未對沖的浮動利率借款和各種其他高成本房產抵押貸款將於 2024 年、2025 年和 2026 年成熟。

The weighted average coupon of the debt we plan to repay is approximately 6.1%. As we saw all these properties, 9 of which were acquired from our merger with STAR in late 2021, we are expecting to record a net loss on sale of between $39 million and $51 million, which includes a $20 million to $24 million gain on a single legacy IRT asset that is expected to be sold. We expect this strategy will result in $0.02 to $0.03 of annual dilution to core FFO per share. And after the effect of annual CapEx, we expect it to be breakeven on a free cash flow basis.

我們計劃償還的債務的加權平均票面利率約為6.1%。正如我們所看到的所有這些財產（其中9 項是我們在2021 年底與STAR 合併時收購的），我們預計銷售淨虧損將在3900 萬至5100 萬美元之間，其中包括2000 萬至2400 萬美元的收益預計將出售的單一遺留 IRT 資產。我們預計這項策略將導致每股核心 FFO 的年度稀釋為 0.02 至 0.03 美元。在年度資本支出影響之後，我們預計在自由現金流的基礎上將達到損益兩平。

In addition, the related deleveraging is expected to reduce our net debt to adjusted EBITDA by almost 1 full turn and further improve our unencumbered asset ratios as we work towards achieving an investment-grade rating. We also expect that this strategy will remove all floating rate risk from our balance sheet and will significantly reduce our debt maturities in 2024 and 2025, as we disclosed in our earnings supplement.

此外，相關的去槓桿化預計將使我們的淨債務與調整後 EBITDA 之比減少近一倍，並在我們努力實現投資級評級的過程中進一步提高我們的未支配資產比率。我們也預計，這項策略將從我們的資產負債表中消除所有浮動利率風險，並將顯著減少我們在 2024 年和 2025 年的債務到期日，正如我們在收益補充中所揭露的那樣。

With respect to our full year 2023 outlook, we are lowering our EPS guidance range from $0.25 to $0.27 to a loss of $0.07 to $0.02, which now reflects estimated impairment losses of real estate assets just as discussed, as a result of our strategy. Our 2023 core FFO per share guidance midpoint changes by roughly $0.005. We are reducing our same-store portfolio from 115 to 106 properties as a result of this portfolio optimization and deleveraging strategy as we just discussed.

就我們2023 年全年展望而言，我們將每股收益指引範圍從0.25 美元至0.27 美元下調至虧損0.07 美元至0.02 美元，這反映了我們所討論的房地產資產減損損失估計，這是我們策略的結果。我們的 2023 年核心 FFO 每股指引中位數變化約 0.005 美元。正如我們剛才討論的那樣，由於投資組合優化和去槓桿化策略，我們將同店投資組合從 115 家減少到 106 家。

The midpoint of our new same-store revenue guidance is 5.6%, down from 6.35% previously. This reflects the following assumptions for the fourth quarter of 2023. Average occupancy of 94.4%, a blended net effective rental rate increase of 90 basis points and bad debt at approximately 2% of revenue. On the expense side, our guidance for full year 2023 total operating expense growth is now more favorable at 5.7%, down from 6.1% at the midpoint of our ranges.

我們新的同店收入指引的中位數是 5.6%，低於先前的 6.35%。這反映了 2023 年第四季的以下假設。平均入住率為 94.4%，混合淨有效租金率成長 90 個基點，壞帳約為收入的 2%。在費用方面，我們對 2023 年全年總營運費用成長的指導現在更為有利，為 5.7%，低於我們範圍中點的 6.1%。

Controllable operating expenses are now expected to be up 6.5% at the midpoint versus previous guidance of 5.1%, driven by higher inflationary pressure on services as well as higher cost to turn units associated with evictions. Noncontrollable operating expenses for real estate taxes and insurance are now expected to be up 4.5% at the midpoint. This is down from our previous guidance of 7.8%, driven by lower assessed value than expected and early successes with 2023 real estate tax appeals. As a result of these changes, our revised midpoint for property NOI growth is now 5.5%, down from 6.5%.

由於服務業通膨壓力加大以及與驅逐相關的單位週轉成本上升，可控營運支出目前預計將成長 6.5%，高於先前指引的 5.1%。房地產稅和保險等不可控制的營運支出目前預計中位數將成長 4.5%。這低於我們之前 7.8% 的指引，原因是評估價值低於預期以及 2023 年房地產稅上訴取得了早期成功。由於這些變化，我們修訂後的房地產 NOI 成長中點現為 5.5%，低於 6.5%。

We are reducing our G&A and property management expense guidance to a midpoint of $50.5 million, down from $51 million previously. And we are also reducing the range and midpoint for full year interest expense to $101.5 million, down from $103 million. While we're still not assuming any acquisition volume for this year, we are maintaining our disposition guidance of [$124.5] million at the midpoint as we are not expecting the additional sales from our portfolio optimization strategy will occur this year, but rather in early 2024.

我們將 G&A 和物業管理費用指導從先前的 5,100 萬美元下調至 5,050 萬美元的中位數。我們也將全年利息支出的範圍和中點從 1.03 億美元下調至 1.015 億美元。雖然我們仍然沒有假設今年有任何收購量，但我們仍維持中點 1.245 億美元的處置指導，因為我們預計今年不會出現投資組合優化策略帶來的額外銷售，而是會在年初出現。2024 年。

Now I'll turn the call back to Scott. Scott?

現在我將把電話轉回給史考特。史考特？

Thanks, Jim. In closing, we feel very good about our position despite the near-term environment. First, we have the right assets in the right markets that will continue to benefit from favorable demographic trends. Second, value-add is core to who we are and will remain a consistent source of organic growth with the portfolio throughout the cycle. And lastly, we are now taking decisive action to optimize the portfolio and fundamentally reset our leverage profile. We are committed to this strategy as we believe it will deliver sustainable earnings growth.

謝謝，吉姆。最後，儘管近期環境不佳，但我們對自己的立場感到非常滿意。首先，我們在合適的市場擁有合適的資產，這些資產將繼續受益於有利的人口趨勢。其次，增值是我們的核心，並將在整個週期中繼續成為投資組合有機成長的持續來源。最後，我們現在正在採取果斷行動來優化投資組合，並從根本上重置我們的槓桿狀況。我們致力於這項策略，因為我們相信它將帶來可持續的獲利成長。

We thank you for joining us today, and we look forward to speaking with many of you at NAREIT's regrowth conference in the coming weeks. Operator, you can open the call for questions.

我們感謝您今天加入我們，我們期待在未來幾週的 NAREIT 再生會議上與您中的許多人交談。接線員，您可以打開電話提問。

(Operator Instructions)

（操作員說明）

We'll take our first question from Austin Wurschmidt at KeyBanc Capital Markets.

我們將回答 KeyBanc Capital Markets 的 Austin Wurschmidt 提出的第一個問題。

Are the 10 assets being marketed as one-off sales? Or are you attempting to sell as a portfolio? And can you give us a sense how far along you are in the marketing process and just how deep the pool of buyers has been so far?

這 10 項資產是否作為一次性銷售進行行銷？或者您正在嘗試將其作為投資組合出售？您能否讓我們了解一下您在行銷過程中的進展以及到目前為止的買家群體有多深？

Sure, Austin. Thanks for the question. They're being marketed as one-off transactions because they're in varied markets. And we started this process a little bit ago and are well along. We have a couple under agreement. There's a third agreement ready to be signed. There's a couple more LOIs. So we're well into the process. And that's what gives us confidence that we'll get this done.

當然，奧斯汀。謝謝你的提問。它們被作為一次性交易進行行銷，因為它們位於不同的市場。我們不久前就開始了這個過程，並且進展順利。我們有一對已達成協議的夫婦。第三份協議已準備好簽署。還有更多的意向書。所以我們已經很好地進入了這個過程。這讓我們有信心完成這件事。

And I guess just what gives you the confidence that you can execute a sale at the pricing you've alluded to in your prepared remarks? I mean, other than -- it does sound like you've made some progress here before. But then upon executing a sale. I'm also curious what the ultimate target is now for net debt to EBITDA over, call it, the next 24 months or so?

我想是什麼讓您有信心以您在準備好的發言中提到的價格執行銷售？我的意思是，除了——聽起來你之前確實已經取得了一些進展。但在執行銷售後。我還很好奇，在未來 24 個月左右的時間裡，淨債務與 EBITDA 比率的最終目標是什麼？

Well, I'm going to let Jim answer the last part of that question. But there was good demand for these properties as we took them out to market, multiple bids, very qualified and well-heeled buyers that we know is because we went -- we took them through buyer interviews. So it gives us confidence that we'll get it done, and we intend to sell these assets.

好吧，我要讓吉姆回答這個問題的最後一部分。但當我們將這些房產推向市場時，對這些房產的需求量很大，經過多次出價，我們知道有非常合格且富有的買家，這是因為我們去了——我們對他們進行了買家訪談。因此，這讓我們有信心完成任務，並且我們打算出售這些資產。

And Austin, on the question on the net debt to EBITDA, we've given our perspective that we expect it to be kind of mid-5s at the end of 2025. We fully expect that we'll be pulling that up into certainly 2024, if not maybe mid-2024. So we expect our net debt to EBITDA to ratchet down by that almost that entire full turn and continue to make additional progress as debt to EBITDA grows.

奧斯汀，關於 EBITDA 淨債務問題，我們已經給出了我們的觀點，我們預計到 2025 年底，淨債務將達到 5 左右。我們完全預計，我們肯定會在 2024 年將這一數字拉高，如果不是的話也許是2024 年中期。因此，我們預計我們的 EBITDA 淨債務將在幾乎整個週期中逐漸減少，並隨著 EBITDA 債務的增長而繼續取得額外進展。

We'll go next to John Kim at BMO Capital Markets.

接下來我們將採訪 BMO 資本市場的約翰金 (John Kim)。

Can you discuss where bad debt was during the third quarter? And how you see that improving or progressing over the next 12 months?

您能討論一下第三季的壞帳情況嗎？您如何看待未來 12 個月的改善或進展？

Yes. So bad debt in the third quarter was about 1.9%. We expect -- right now, in our initial guidance for the year, we expect it to be about 1.5%. We think that will be kind of hovering for the full year rate around 2%. And then as Mike alluded to in his prepared remarks, as we make additional progress on the ID verification as well as an improved income verification tool that we'll continue to see that bad debt ratchet down next year.

是的。因此第三季壞帳約為1.9%。我們預計——目前，在我們今年的初步指導中，我們預計這一比例約為 1.5%。我們認為全年成長率將徘徊在 2% 左右。然後，正如麥克在他準備好的演講中提到的那樣，隨著我們在身份驗證以及改進的收入驗證工具方面取得更多進展，我們將在明年繼續看到壞帳逐漸減少。

And that 1.9%, was that gross or net of resident relief fund?

那 1.9% 是居民救濟基金的總額還是淨額？

There really wasn't very much resident relief fund. So I would say it's both.

居民救濟金確實不多。所以我想說兩者兼具。

On your value add, the 23 properties, the new lease growth rate decelerated, it was down 1.6% in the fourth quarter. Can you explain this dynamic? I thought the renovated units themselves were generating enough rents, I guess, the 20% uplift in rents to bring up the total average of the buildings.

在增加價值方面，23個物業的新租賃成長放緩，第四季下降了1.6%。你能解釋一下這個動態嗎？我認為翻新的單位本身已經產生了足夠的租金，我猜，租金上漲 20% 可以提高建築物的總平均租金。

Sure. It's really a seasonality and timing issue. As we work to push occupancy, the value add was part of that effort. There is good demand. We're not carrying a lot of value-add units that have been completed. They're getting leased, and we expect that to normalize back to more historical levels next year. Now that occupancy is stable, it gives us the view that it will again normalize next year.

當然。這實際上是一個季節性和時間問題。當我們努力提高入住率時，增值就是這項努力的一部分。有良好的需求。我們沒有大量已完工的加值單位。它們正在出租，我們預計明年這種情況將恢復到歷史水平。現在入住率已經穩定，我們認為明年將再次恢復正常。

Do you expect a return -- expectations to continue to moderate?

您是否期望回報－預期會繼續放緩？

To moderate? No. No. I expect it to be back towards that 18% in 2024.

適度？不，不，我預計到 2024 年它會回到 18%。

We'll go next to Brad Heffern at RBC Capital Markets.

接下來我們將採訪加拿大皇家銀行資本市場部的布拉德‧赫芬 (Brad Heffern)。

Can you talk about why you're pursuing this deleveraging program now? Obviously, you bought STAR a couple of years ago. So I guess, why not sell these kind of one-off cats and dogs immediately and what made now the right time to do it?

您能談談為什麼現在要推行這個去槓桿計畫嗎？顯然，您幾年前購買了 STAR。所以我想，為什麼不立即賣掉這些一次性的貓狗呢？為什麼現在正是賣掉它的最佳時機呢？

So good question. We looked at the current interest rate environment. And with the broad view that now rates will stay higher for longer. We felt that cap rates probably were not going to go down in the near term. What kept us from doing it previously was that there was significant yield maintenance or defeasance costs associated with the property level mortgages on these properties.

好問題。我們研究了目前的利率環境。人們普遍認為，現在利率將在更長時間內保持在較高水準。我們認為資本化率短期內可能不會下降。先前阻止我們這樣做的原因是，這些房產的房產水平抵押貸款存在大量的收益維持或廢止成本。

Now those -- because of the increase in rates in the passage of time, that prepayment penalty, if you will, is gone. So with the view that the rate is going to be higher for longer and with no prepayment costs, now we decided it was time to just exit these markets. So we had always planned on exiting and to use the proceeds to delever.

現在，由於利率隨著時間的推移而增加，提前還款罰款（如果你願意的話）已經消失了。因此，考慮到利率將在更長時間內保持較高水平並且沒有預付款成本，現在我們決定是時候退出這些市場了。所以我們一直計劃退出並用收益去槓桿化。

Okay. Got it. And then probably for you, Jim. I guess some of the building blocks for 2024, I was wondering if you could give them like -- your current expectation for earn-in the thoughts on lease and any initial thoughts on whether we'll see market rent growth.

好的。知道了。然後可能是你，吉姆。我猜想 2024 年的一些構建模組，我想知道您是否可以給出類似的信息——您目前對租賃收入的預期，以及關於我們是否會看到市場租金增長的任何初步想法。

So good question. Obviously, 2024 is still very much unknown. But the current building blocks, the current lost for lease is 1.8% across the portfolio. Our current expectations for earnings for next year are about 1.3%. And obviously, that's assuming kind of that kind of continue -- what we've seen rent growth so far now in the fourth quarter, that continues from November, December. And then right now, CoStar is reporting that our submarkets should experience 2.4% market rent growth.

好問題。顯然，2024 年仍然是一個未知數。但就目前的建築而言，目前整個投資組合的租賃損失為 1.8%。我們目前對明年獲利的預期約為1.3%。顯然，這是假設這種情況持續下去——到目前為止，我們在第四季度看到了租金增長，這種增長從 11 月到 12 月一直持續。現在，CoStar 報告稱，我們的子市場應該會經歷 2.4% 的市場租金成長。

We'll move to our next question from Anthony Powell at Barclays.

我們將轉向巴克萊銀行安東尼·鮑威爾提出的下一個問題。

You talked in the past about how Class B apartments should benefit from trade down in a slower economic environment. Are you seeing any of that? Or is the supply environment may be making that more difficult this time around?

您過去曾談到，在經濟放緩的環境下，B 級公寓應如何從降價交易中受益。你看到這些了嗎？還是供應環境可能會讓這次變得更困難？

Thanks for the question. This is Mike. I think we are continuing to see that, A properties are being hit harder than B. I think those are the ones where we see the developers getting more aggressive with concessions. Obviously, that directly impacts the A market more so than the B market. And I think that our properties have definitely shown more occupancy and rent growth strength on our B assets.

謝謝你的提問。這是麥克。我認為我們會繼續看到，A 房產受到的打擊比 B 房產更嚴重。我認為，在這些房產中，我們看到開發商做出了更積極的讓步。顯然，這對 A 市場的直接影響比對 B 市場的影響更大。我認為，我們的 B 類資產的入住率和租金成長勢頭確實表現得更好。

As far as markets being impacted, I think 2024, we expect that to be better from an impression -- from a concession perspective, I think Atlanta, less pressure with the new supply, which is good for us. Obviously, that's a big market. Dallas, Nashville, the other ones, that were mentioned earlier, either very slightly up in terms of new supplier or even with...

就市場受到的影響而言，我認為 2024 年，我們預計情況會更好——從特許經營的角度來看，我認為亞特蘭大的新供應壓力較小，這對我們有利。顯然，這是一個很大的市場。達拉斯、納許維爾以及前面提到的其他地方，要么在新供應商方面略有上升，甚至…

And more generally, I mean, are you seeing any signs of stress in the consumer base in the outside of things like fraud? Are you seeing -- and is coming to you saying that -- just -- and just any kind of signs that consumers are being more stressed on a broader level than just more specific situations.

更一般地說，我的意思是，您是否看到消費者群體在欺詐等事件之外存在任何壓力跡象？你是否看到——並且你會說——只是——以及任何一種跡象表明，消費者在更廣泛的層面上承受更大的壓力，而不僅僅是更具體的情況。

Specific to our business, no. Our rent-to-income ratio has remained very consistent at 22%. We've not seen any upward trend and any inability to pay than we have in the prior periods. We do actually have better credit in our applicants than we did, say, a year ago. So we're seeing an upward trend in terms of creditworthiness of our applicants. And I don't think it's any surprise that any pressure on consumers generally impacts the residents in all multifamily, but nothing specific to our business beyond that normal consumer pressure.

具體到我們的業務，沒有。我們的租金與收入比率一直維持在 22%。我們沒有看到任何上升趨勢，也沒有看到任何無力支付的情況。事實上，我們的申請人的信用確實比一年前更好。因此，我們看到申請人的信用度呈現上升趨勢。我認為，消費者承受的任何壓力通常都會影響所有多戶家庭的居民，這並不奇怪，但除了正常的消費者壓力之外，我們的業務沒有什麼特殊的。

Next, we'll move to Eric Wolfe at Citigroup.

接下來，我們將邀請花旗集團的 Eric Wolfe。

Can you talk about where you expect new and renewal rate growth to go through the rest of the year? And if you think we'll sort of see peak pressure from supply on your rate growth in the first half of next year, if there's going to be a bit of a lag there just given the time it takes to lease up all the new supply.

您能談談您預計今年剩餘時間新增和續訂率的成長嗎？如果您認為我們會在明年上半年看到供應對您的利率成長造成的峰值壓力，考慮到租賃所有新供應所需的時間，是否會出現一點滯後。

Yes. I mean I think -- again, I think we'll continue to see a little bit of that. The rent growth that we've seen so far that we've reported in the fourth quarter, we think that will continue for November, December. I think the blend in our guidance that we have for the entire fourth quarter is about 90 basis points of blended rent growth.

是的。我的意思是，我認為——再說一遍，我認為我們會繼續看到這樣的情況。到目前為止，我們在第四季度報告的租金成長情況，我們認為這種情況將持續到 11 月和 12 月。我認為我們對整個第四季度的指導意見中的混合租金增長約為 90 個基點。

As far as the new supply, I think -- we are looking at our submarket new supply. I think that the -- as I mentioned earlier, Dallas, Nashville, Atlanta, we see that moderating, especially in Atlanta. And I think that in terms of the delivery, we do see that in the first half of next year. Obviously, there will be some absorption tail on that delivery, but definitely, to your point, first half.

就新供應而言，我認為我們正在研究子市場的新供應。我認為，正如我之前提到的，達拉斯、納許維爾、亞特蘭大，我們看到這種情況有所緩和，特別是在亞特蘭大。我認為就交付而言，我們確實會在明年上半年看到這一點。顯然，該交付會有一些吸收尾部，但就你的觀點而言，肯定是上半場。

And I'd like to add that for the fourth quarter, as we sit here today, if you use a 50% renewal rate for lease expirations, 85% of that 50% has already renewed, and they renewed at an average 5% rent increase. So that gives you a good idea of how we see the fourth quarter finishing out.

我想補充一點，就第四季度而言，當我們今天坐在這裡時，如果您在租約到期時使用50% 的續租率，那麼這50% 中的85% 已經續租，並且他們以平均5% 的租金續租增加。這樣您就可以很好地了解我們如何看待第四季度的結束。

Got it. And I think you mentioned that one of your data providers is predicting I mean like 2.4% market rent growth next year. I mean do you think that's, I guess, reasonable given everything that's going on? I mean, I would say that the market would probably be pretty excited about that growth just given views around what Sunbelt Supply is going to do as sort of the compounding effect of it keeps increasing.

知道了。我想您提到您的數據供應商預測明年市場租金將成長 2.4%。我的意思是，考慮到正在發生的一切，你認為這合理嗎？我的意思是，我想說，市場可能會對這種成長感到非常興奮，只要考慮到 Sunbelt Supply 將要做什麼，因為它的複合效應不斷增加。

So I mean, just from your perspective, I mean do you think that 2.4% is reasonable. And when you're looking to set your guidance early next year, I mean, are you mainly looking at some of the third-party data providers? Or is it more of a sort of ground up, look, each of your properties put out a forecast and you build that into your guidance?

所以我的意思是，僅從你的角度來看，我的意思是你認為2.4%合理嗎？當您希望在明年初設定指導時，我的意思是，您主要關註一些第三方資料提供者嗎？或者它更像是一種基礎，看，你的每家酒店都提出了預測，然後你將其納入你的指導中？

So a long question. So let's break that into pieces. So in terms of our budgeting and forecasting process, it's very much a ground-up process with each one of our communities kind of having input into kind of what they think rents could grow by in terms of renewal and new leases.

這是一個很長的問題。那麼讓我們把它分成幾個部分。因此，就我們的預算和預測過程而言，這在很大程度上是一個從頭開始的過程，我們的每個社區都對他們認為在續租和新租約方面租金可能增長的內容進行了投入。

As we can always say that our data providers certainly provide data, and we use multiple ones. The one I quoted was CoStar is kind of at 2.4%. I think it's probably certainly reasonable given what the data and how their economists have predicted. But obviously, 2024 is still very much unknown and we're all evaluating kind of what the effects of new supply will continue to have across -- certainly us as well as our markets.

我們總是可以說，我們的數據提供者當然提供數據，我們使用多個數據。我引用的 CoStar 是 2.4%。我認為考慮到數據和經濟學家的預測，這可能肯定是合理的。但顯然，2024 年仍然是一個未知數，我們都在評估新供應將繼續對我們以及我們的市場產生什麼影響。

We'll come next to Wes Golladay at Baird.

接下來我們將來到貝爾德的韋斯·戈拉迪 (Wes Golladay)。

As you look to next year for the value add program, I think you mentioned you're still going to get those high teens returns. Do you expect the same amount of projects next year?

當您展望明年的增值計劃時，我認為您提到您仍然會獲得那些高青少年回報。您預計明年的項目數量是否相同？

Yes. Our target next year will be for 2,500 to 3,000 units for next year.

是的。我們明年的目標是生產 2,500 至 3,000 套。

Okay. Fantastic. And then you mentioned operational efficiencies rolling out next year. How should we think about expense growth compared to this year? Is there any onetime items that will be hard to comp next year or easy comps? And how will these efficiencies benefit you next year?

好的。極好的。然後您提到明年推出的營運效率。與今年相比，我們該如何看待費用成長？是否有一些一次性項目明年很難獲得或容易獲得？明年這些效率將為您帶來什麼好處？

Yes. Good question. We're obviously not giving any color yet on 2024 expenses. We're still through the budgeting process. I would think that one of the big areas that we'll -- we expect to see some further progress on is bad debt. I realize that's not necessarily an expense is a negative to the revenue line. But that's a key area that Mike and Janice and team expect to see some progress on as we roll out these new technology tools. So I think we're very much still open on 2024, and we'll be prepared to kind of talk about it more in February when we give our guidance for 2024.

是的。好問題。顯然我們還沒有透露 2024 年支出的任何細節。我們仍在完成預算過程。我認為我們預計會看到一些進一步進展的重要領域之一是壞帳。我意識到這不一定是一項支出，對收入線來說是負面的。但這是麥克和賈尼斯及其團隊希望在我們推出這些新技術工具時看到一些進展的關鍵領域。因此，我認為我們在 2024 年仍然保持開放狀態，並且我們將準備在 2 月給出 2024 年指導時更多地討論這一問題。

Got it. And if I could squeeze one more in. Let me just -- commentary on other calls where the concessions were so low or so high that some people are moving from B to A assets. Are you seeing that in any of your markets where maybe a year from now when they can't afford A rent, they come back, trying to get a feel for the dynamic in some of these markets.

知道了。如果我能再擠進去一點的話。讓我對其他電話進行評論，這些電話的優惠太低或太高，以至於一些人從 B 資產轉向 A 資產。您是否發現，在您的任何市場中，也許一年後，當他們買不起房租時，他們就會回來，試圖了解其中一些市場的動態。

I think in this -- this is Janice. I think in the 3 markets that we mentioned, where we've seen that increased supply during a low seasonality, which is Atlanta and Dallas and Nashville. We've seen a sum of that, but we still see that our B assets are outperforming our A assets holistically.

我想這就是珍妮絲。我認為在我們提到的三個市場中，我們看到在淡季期間供應增加，這三個市場是亞特蘭大、達拉斯和納許維爾。我們已經看到了這些的總和，但我們仍然看到我們的 B 資產整體上優於我們的 A 資產。

Next, we'll go to Merrill Ross at Compass Point.

接下來，我們將前往 Compass Point 的 Merrill Ross。

I wanted to just make sure I did calculate a rent concession. Do you expect them to alleviate early next year or continue to be high? And how does that change your focus in terms of tenant retention?

我只是想確保我確實計算了租金優惠。您預計明年初會有所緩解還是繼續保持高位？這如何改變您對保留租戶的關注？

I think in terms of retention, this is Mike. I think in terms of retention, we've seen, as Scott referenced earlier, very strong numbers in terms of both renewals as well as the rate that those renewals are being accepted at. Concessions are going to go down. They're going down as we speak, relatively speaking. As we see that supply pressure continue to alleviate, obviously, the concession as a strategy would go down as well.

我認為就保留率而言，這是麥克。我認為就保留率而言，正如斯科特之前提到的，我們已經看到續訂以及這些續訂被接受的比率都非常強勁。優惠將會減少。相對而言，就在我們說話的時候，它們正在下降。當我們看到供應壓力繼續緩解時，顯然，作為策略的讓步也會下降。

We think the approach that we've taken is very good from a renewal perspective in the future because our residents will not have that kind of sticker shock when they have moved -- those folks that have moved to A, are going to have to pay that additional amount if they've received a rent reduction, whereas with our concessions, they will pay 11 months at a higher rate, and we'll be not surprised when renewal time comes around.

我們認為，從未來更新的角度來看，我們採取的方法非常好，因為我們的居民在搬家時不會有那種價格衝擊——那些搬到 A 的人將不得不支付費用如果他們獲得租金減免，他們將獲得額外的金額，而根據我們的優惠，他們將以更高的價格支付11 個月的費用，並且當續約時間到來時，我們不會感到驚訝。

That totally makes sense. So a separate question. Since the reception was relatively strong to the asset sales and the dividend coverage remains deep. Is it possible that you go for another round of maybe 5 more assets? Or are you done?

這完全有道理。這是一個單獨的問題。由於資產出售的反應相對強勁，且股息覆蓋率仍較高。您是否有可能再進行一輪（也許還有 5 個資產）？或者你完成了嗎？

We're always looking to concentrate and better manage the portfolio as a whole. Right now, we've only identified these 10. But depending on demographic changes, there may be more in the future, but there's no plans at this point.

我們始終致力於集中精力並更好地管理整個投資組合。目前，我們只確定了這 10 個。但根據人口變化，未來可能會有更多，但目前還沒有計劃。

We'll take our next question from John Kim at BMO Capital Markets.

我們將回答蒙特利爾銀行資本市場部的約翰金 (John Kim) 提出的下一個問題。

On the dispositions, can you provide some more commentary on how many of the 10 assets have mortgage debt in place and what the average interest rate is?

關於處置，您能否提供更多關於這 10 項資產中有多少有抵押貸款債務以及平均利率是多少的評論？

Yes. So 9 of the 10 assets have mortgage debt in place. One asset is pretty unclear. And the average interest rate of the debt that we will pay off because we're going to have about $240 million of excess cash after the sales pay off kind of line of credit, et cetera, is about 6.1%.

是的。因此，這 10 項資產中有 9 項擁有抵押貸款債務。其中一項資產相當不清楚。我們將償還的債務的平均利率約為 6.1%，因為在銷售還清信貸額度等後，我們將擁有約 2.4 億美元的超額現金。

I was more questioning the average interest rate on those assets and if that played a major factor in identifying those assets for sale?

我更質疑這些資產的平均利率，這是否是確定這些待售資產的主要因素？

Yes. The average interest rate on the mortgages, there's 9 mortgages themselves are -- I don't have the exact number, low 5%, like 5%, 5.1%. I can come back to the specific.

是的。抵押貸款的平均利率，有9種抵押貸款本身——我沒有確切的數字，低至5%，例如5%、5.1%。我可以回到具體的話題。

And next, we'll move to Linda Tsai at Jefferies.

接下來，我們將邀請傑富瑞 (Jefferies) 的琳達·蔡 (Linda Tsai)。

Who are the potential buyers for the assets from your deleveraging program? And would you expect multiple bidders?

誰是你的去槓桿化計劃資產的潛在買家？您會期望有多個競標者嗎？

We've had multiple bidders, and we can't identify who the buyers are. But each property was marketed independent of the others as one-off sales, and there were multiple bidders on each one.

我們有多個投標人，但我們無法確定買家是誰。但每個房產都是獨立於其他房產進行一次性銷售的，而且每處房產都有多個競標者。

And apologies if I missed this. With the 10 assets for sale, are there other assets no longer subject to prepayment penalty that you would consider for sale?

如果我錯過了這一點，我深表歉意。在出售 10 項資產後，您是否會考慮出售其他不再受預付款罰金的資產？

There are lots of other assets that are not subject to prepayment penalties, but that was really not the driving force. The driving force was that we wanted to exit certain markets. And we couldn't do it or we decided not to do it earlier because of the prepayment penalties. But the driving force is exiting the markets and then generating the capital to retire the debt.

還有許多其他資產不受提前還款罰款的影響，但這實際上並不是驅動力。驅動力是我們想退出某些市場。我們無法這樣做，或由於預付款罰款，我們決定不提前這樣做。但推動力是退出市場，然後產生資本來償還債務。

With the sale, are you exiting all the markets you would like to exit?

透過出售，您是否會退出所有您想退出的市場？

All of the markets -- all of the -- let me start out, all of the sales are in markets that we want to exit. We will continue to view the portfolio going forward for additional markets. But at this time, we're exiting the ones we want to.

所有的市場——所有的——讓我開始，所有的銷售都在我們想要退出的市場。我們將繼續關注其他市場的投資組合。但此時，我們正在退出我們想要的那些。

And that does conclude our question-and-answer session. At this time, I'd like to turn the conference back to Scott Schaeffer for closing remarks.

我們的問答環節到此結束。這次，我想請史考特‧謝弗（Scott Schaeffer）致閉幕詞。

Thank you all for joining us today, and we look forward to speaking with you next quarter.

感謝大家今天加入我們，我們期待下個季度與您交談。

And that does conclude today's conference call. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連線。