FORM | ||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(Exact Name of Registrant as Specified in Its Charter) |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | ||||
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
x | Accelerated filer | o | ||||||||||||
Non-Accelerated filer | o | Smaller reporting company | ||||||||||||
Emerging growth company |
Page | ||||||||
Condensed Consolidated Statements of Operations for the Three Months ended March 31, 2023 and March 31, 2022 | ||||||||
As of March 31, 2023 | As of December 31, 2022 | ||||||||||
ASSETS: | |||||||||||
Investments in real estate: | |||||||||||
Investments in real estate, at cost | $ | $ | |||||||||
Accumulated depreciation | ( | ( | |||||||||
Investments in real estate, net | |||||||||||
Real estate held for sale | |||||||||||
Investment in real estate under development | |||||||||||
Cash and cash equivalents | |||||||||||
Restricted cash | |||||||||||
Investments in unconsolidated real estate entities | |||||||||||
Other assets | |||||||||||
Derivative assets | |||||||||||
Intangible assets, net of accumulated amortization of $ | |||||||||||
Total Assets | $ | $ | |||||||||
LIABILITIES AND EQUITY: | |||||||||||
Indebtedness, net | $ | $ | |||||||||
Accounts payable and accrued expenses | |||||||||||
Accrued interest payable | |||||||||||
Dividends payable | |||||||||||
Derivative liabilities | |||||||||||
Other liabilities | |||||||||||
Total Liabilities | |||||||||||
Equity: | |||||||||||
Stockholders’ equity: | |||||||||||
Preferred stock, $ issued and outstanding, respectively | |||||||||||
Common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Accumulated other comprehensive income | |||||||||||
Accumulated deficit | ( | ( | |||||||||
Total stockholders’ equity | |||||||||||
Noncontrolling interests | |||||||||||
Total Equity | |||||||||||
Total Liabilities and Equity | $ | $ |
For the Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
REVENUE: | |||||||||||
Rental and other property revenue | $ | $ | |||||||||
Other revenue | |||||||||||
Total revenue | |||||||||||
EXPENSES: | |||||||||||
Property operating expenses | |||||||||||
Property management expenses | |||||||||||
General and administrative expenses | |||||||||||
Depreciation and amortization expense | |||||||||||
Casualty losses (gains), net | ( | ||||||||||
Total expenses | |||||||||||
Interest expense | ( | ( | |||||||||
Gain on sale of real estate assets, net | |||||||||||
Merger and integration costs | ( | ||||||||||
Other income, net | |||||||||||
Loss from investments in unconsolidated real estate entities | ( | ( | |||||||||
Restructuring costs | ( | ||||||||||
Net income: | |||||||||||
Income allocated to noncontrolling interest | ( | ( | |||||||||
Net income allocable to common shares | $ | $ | |||||||||
Earnings per share: | |||||||||||
Basic | $ | $ | |||||||||
Diluted | $ | $ | |||||||||
Weighted-average shares: | |||||||||||
Basic | |||||||||||
Diluted |
For the Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net income | $ | $ | |||||||||
Other comprehensive (loss) income: | |||||||||||
Change in fair value of interest rate hedges | ( | ||||||||||
Realized gains (losses) on interest rate hedges reclassified to earnings | ( | ||||||||||
Total other comprehensive (loss) income | ( | ||||||||||
Comprehensive (loss) income before allocation to noncontrolling interests | ( | ||||||||||
Allocation to noncontrolling interests | ( | ||||||||||
Comprehensive (loss) income | $ | ( | $ |
Common Shares | Par Value Common Shares | Additional Paid In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Accumulated Deficit) | Total Stockholders’ Equity | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Common dividends declared ($ | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | ( | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of shares related to equity award tax withholding | ( | — | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Conversion of noncontrolling interest to common shares | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common shares, net | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Distribution to noncontrolling interest declared ($ | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2023 | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Common Shares | Par Value Common Shares | Additional Paid In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings (Accumulated Deficit) | Total Stockholders’ Equity | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Common dividends declared ($ | — | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
Repurchase of shares related to equity award tax withholding | ( | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||
Conversion of noncontrolling interest to common shares | — | — | — | ( | — | |||||||||||||||||||||||||||||||||||||||||||||
Issuance of common shares, net | ( | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
Distribution to noncontrolling interest declared ($ | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to cash flow from operating activities: | |||||||||||
Depreciation and amortization | |||||||||||
Accretion of loan discounts and premiums, net | ( | ( | |||||||||
Amortization of deferred financing costs, net | |||||||||||
Stock compensation expense | |||||||||||
Gain on sale of real estate assets, net | ( | ( | |||||||||
Amortization related to derivative instruments | |||||||||||
Casualty losses (gains), net | ( | ||||||||||
Equity in loss from investments in unconsolidated real estate entities | |||||||||||
Other loss (income) | ( | ||||||||||
Changes in assets and liabilities: | |||||||||||
Other assets | |||||||||||
Accounts payable and accrued expenses | ( | ( | |||||||||
Accrued interest payable | ( | ||||||||||
Other liabilities | ( | ( | |||||||||
Cash flow provided by operating activities | |||||||||||
Cash flows from investing activities: | |||||||||||
Investments in unconsolidated real estate entities | ( | ( | |||||||||
Disposition of real estate properties, net | |||||||||||
Capital expenditures | ( | ( | |||||||||
Additions to real estate under development | ( | ( | |||||||||
Proceeds from insurance claims | |||||||||||
Cash flow (used in) provided by investing activities | ( | ||||||||||
Cash flows from financing activities: | |||||||||||
Costs from issuance of common stock, net | ( | ( | |||||||||
Proceeds from unsecured credit facility and term loans | |||||||||||
Unsecured credit facility, secured credit facility and term loan repayments | ( | ( | |||||||||
Mortgage principal repayments | ( | ( | |||||||||
Payments for deferred financing costs | ( | ||||||||||
Distributions on common stock | ( | ( | |||||||||
Distributions to noncontrolling interests | ( | ( | |||||||||
Repurchase of shares related to equity award tax withholding | ( | ( | |||||||||
Cash flow used in financing activities | ( | ( | |||||||||
Net change in cash and cash equivalents, and restricted cash | ( | ( | |||||||||
Cash and cash equivalents, and restricted cash, beginning of period | |||||||||||
Cash and cash equivalents, and restricted cash, end of the period | $ | $ | |||||||||
Reconciliation of cash, cash equivalents, and restricted cash to the Condensed Consolidated Balance Sheets | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Restricted cash | |||||||||||
Total cash, cash equivalents, and restricted cash, end of period | $ | $ |
As of March 31, 2023 | As of December 31, 2022 | |||||||||||||||||||||||||
Financial Instrument | Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||
Cash and cash equivalents | $ | $ | $ | $ | ||||||||||||||||||||||
Restricted cash | ||||||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||
Debt: | ||||||||||||||||||||||||||
Unsecured Revolver | ||||||||||||||||||||||||||
Unsecured Term loans | ||||||||||||||||||||||||||
Secured credit facilities | ||||||||||||||||||||||||||
Mortgages | ||||||||||||||||||||||||||
Derivative liabilities |
As of March 31, 2023 | As of December 31, 2022 | Depreciable Lives (In years) | |||||||||||||||
Land | $ | $ | — | ||||||||||||||
Building | |||||||||||||||||
Furniture, fixtures and equipment | |||||||||||||||||
Total investments in real estate | $ | $ | |||||||||||||||
Accumulated depreciation | ( | ( | |||||||||||||||
Investments in real estate, net | $ | $ |
Carrying Value As Of | ||||||||||||||||||||||||||||||||
Investments in Unconsolidated Real Estate Entities | Location | Units(1) (Unaudited) | IRT Ownership Interest | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||||||
Metropolis at Innsbrook | Richmond, VA | % | $ | $ | ||||||||||||||||||||||||||||
Views of Music City II / The Crockett | Nashville, TN | % | ||||||||||||||||||||||||||||||
Virtuoso | Huntsville, AL | % | ||||||||||||||||||||||||||||||
Lakeline Station | Austin, TX | % | ||||||||||||||||||||||||||||||
The Mustang | Dallas, TX | % | ||||||||||||||||||||||||||||||
Total | $ | $ |
Debt: | Outstanding Principal | Unamortized Debt Issuance Costs | Unamortized Loan (Discount)/Premiums | Carrying Amount | Type | Weighted Average Rate (3) | Weighted Average Maturity (in years) | |||||||||||||||||||||||||||||||||||||
Unsecured revolver (1) | $ | $ | ( | $ | $ | Floating | ||||||||||||||||||||||||||||||||||||||
Unsecured term loans | ( | Floating | ||||||||||||||||||||||||||||||||||||||||||
Secured credit facilities (2) | ( | Floating/Fixed | ||||||||||||||||||||||||||||||||||||||||||
Mortgages | ( | Fixed | ||||||||||||||||||||||||||||||||||||||||||
Total Debt | $ | $ | ( | $ | $ |
Scheduled maturities on our indebtedness outstanding as of March 31, 2023 | ||||||||||||||||||||||||||||||||||||||
Debt: | 2023 | 2024 | 2025 | 2026 | 2027 | Thereafter | ||||||||||||||||||||||||||||||||
Unsecured revolver | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Unsecured term loans | ||||||||||||||||||||||||||||||||||||||
Secured credit facilities | ||||||||||||||||||||||||||||||||||||||
Mortgages | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ |
Debt: | Outstanding Principal | Unamortized Debt Issuance Costs | Unamortized Loan (Discount)/Premiums | Carrying Amount | Type | Weighted Average Rate (3) | Weighted Average Maturity (in years) | |||||||||||||||||||||||||||||||||||||
Unsecured revolver | $ | $ | ( | $ | $ | Floating | ||||||||||||||||||||||||||||||||||||||
Unsecured term loans | ( | Floating | ||||||||||||||||||||||||||||||||||||||||||
Secured credit facilities | ( | Floating/Fixed | ||||||||||||||||||||||||||||||||||||||||||
Mortgages | ( | Fixed | ||||||||||||||||||||||||||||||||||||||||||
Total Debt | $ | $ | ( | $ | $ |
As of March 31, 2023 | As of December 31, 2022 | |||||||||||||||||||||||||||||||||||||
Notional | Fair Value of Assets | Fair Value of Liabilities | Notional | Fair Value of Assets | Fair Value of Liabilities | |||||||||||||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||||||||||||||||
Interest rate swaps | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Interest rate collars | ||||||||||||||||||||||||||||||||||||||
Forward interest rate collars | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ |
2023 | |||||||||||
Number of Shares | Weighted Average Grant Date Fair Value Per Share | ||||||||||
Balance, January 1, | $ | ||||||||||
Granted | |||||||||||
Vested | ( | ||||||||||
Forfeited | ( | ||||||||||
Balance, March 31,(1) | $ |
(1) | The outstanding award balances above include |
For the Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net income | $ | $ | |||||||||
Income allocated to noncontrolling interest | ( | ( | |||||||||
Net income allocable to common shares | $ | $ | |||||||||
Weighted-average shares outstanding—Basic | |||||||||||
Weighted-average shares outstanding—Diluted | |||||||||||
Earnings per share—Basic | $ | $ | |||||||||
Earnings per share—Diluted | $ | $ |
(Dollars in thousands, except per unit data) | As of March 31, 2023 | For the Three Months Ended March 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||
Market | Number of Properties | Units | Gross Real Estate Assets | Period End Occupancy | Average Effective Monthly Rent per Unit | Net Operating Income | % of NOI | |||||||||||||||||||||||||||||||||||||
Atlanta, GA | 13 | 5,180 | $ | 1,070,050 | 92.8 | % | $ | 1,637 | $ | 15,267 | 15.0 | % | ||||||||||||||||||||||||||||||||
Dallas, TX | 14 | 4,007 | 854,870 | 94.2 | % | 1,783 | 12,400 | 12.2 | % | |||||||||||||||||||||||||||||||||||
Denver, CO | 9 | 2,292 | 606,372 | 94.0 | % | 1,698 | 8,379 | 8.2 | % | |||||||||||||||||||||||||||||||||||
Columbus, OH | 10 | 2,510 | 368,862 | 95.4 | % | 1,356 | 6,616 | 6.5 | % | |||||||||||||||||||||||||||||||||||
Raleigh - Durham, NC | 6 | 1,690 | 255,624 | 94.8 | % | 1,530 | 5,234 | 5.2 | % | |||||||||||||||||||||||||||||||||||
Indianapolis, IN | 7 | 1,979 | 290,841 | 94.6 | % | 1,334 | 4,981 | 4.9 | % | |||||||||||||||||||||||||||||||||||
Oklahoma City, OK | 8 | 2,147 | 321,400 | 92.5 | % | 1,163 | 4,967 | 4.9 | % | |||||||||||||||||||||||||||||||||||
Tampa-St. Petersburg, FL | 5 | 1,452 | 294,794 | 95.9 | % | 1,801 | 4,834 | 4.8 | % | |||||||||||||||||||||||||||||||||||
Nashville, TN | 5 | 1,508 | 367,696 | 92.8 | % | 1,591 | 4,596 | 4.5 | % | |||||||||||||||||||||||||||||||||||
Houston, TX | 7 | 1,932 | 323,339 | 95.4 | % | 1,427 | 4,320 | 4.3 | % | |||||||||||||||||||||||||||||||||||
Memphis, TN | 4 | 1,383 | 160,176 | 94.2 | % | 1,501 | 4,061 | 4.0 | % | |||||||||||||||||||||||||||||||||||
Birmingham, AL | 2 | 1,074 | 232,510 | 89.3 | % | 1,475 | 2,787 | 2.7 | % | |||||||||||||||||||||||||||||||||||
Charlotte, NC | 3 | 714 | 189,350 | 95.4 | % | 1,756 | 2,675 | 2.6 | % | |||||||||||||||||||||||||||||||||||
Huntsville, AL | 3 | 873 | 189,568 | 95.5 | % | 1,545 | 2,675 | 2.6 | % | |||||||||||||||||||||||||||||||||||
Lexington, KY | 3 | 886 | 160,002 | 96.4 | % | 1,272 | 2,542 | 2.5 | % | |||||||||||||||||||||||||||||||||||
Louisville, KY | 4 | 1,150 | 149,011 | 93.0 | % | 1,285 | 2,541 | 2.5 | % | |||||||||||||||||||||||||||||||||||
Myrtle Beach, SC - Wilmington, NC | 3 | 628 | 68,527 | 95.4 | % | 1,396 | 1,827 | 1.8 | % | |||||||||||||||||||||||||||||||||||
Cincinnati, OH | 2 | 542 | 122,355 | 93.9 | % | 1,553 | 1,589 | 1.6 | % | |||||||||||||||||||||||||||||||||||
Charleston, SC | 2 | 518 | 81,314 | 95.9 | % | 1,603 | 1,534 | 1.5 | % | |||||||||||||||||||||||||||||||||||
Greenville, SC | 1 | 702 | 123,319 | 95.0 | % | 1,231 | 1,497 | 1.5 | % | |||||||||||||||||||||||||||||||||||
Chicago, IL | 1 | 374 | 90,195 | 95.7 | % | 1,772 | 1,226 | 1.2 | % | |||||||||||||||||||||||||||||||||||
Orlando, FL | 1 | 297 | 50,174 | 93.2 | % | 1,787 | 869 | 0.9 | % | |||||||||||||||||||||||||||||||||||
Asheville, NC | 1 | 252 | 29,233 | 97.6 | % | 1,488 | 838 | 0.8 | % | |||||||||||||||||||||||||||||||||||
San Antonio, TX | 1 | 306 | 57,108 | 97.4 | % | 1,483 | 780 | 0.8 | % | |||||||||||||||||||||||||||||||||||
Fort Wayne, IN | 1 | 222 | 44,221 | 91.0 | % | 1,431 | 700 | 0.7 | % | |||||||||||||||||||||||||||||||||||
Austin, TX | 1 | 256 | 56,860 | 91.3 | % | 1,788 | 699 | 0.7 | % | |||||||||||||||||||||||||||||||||||
Norfolk, VA | 1 | 183 | 54,131 | 98.4 | % | 1,882 | 645 | 0.6 | % | |||||||||||||||||||||||||||||||||||
Chattanooga, TN | 1 | 192 | 37,005 | 92.7 | % | 1,374 | 476 | 0.5 | % | |||||||||||||||||||||||||||||||||||
Total/Weighted Average | 119 | 35,249 | $ | 6,648,907 | 94.1 | % | $ | 1,535 | $ | 101,555 | 100.0 | % |
SAME-STORE PORTFOLIO | NON SAME-STORE PORTFOLIO | CONSOLIDATED | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Three Months Ended March 31, | Three Months Ended March 31, | Three Months Ended March 31, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | Increase (Decrease) | % Change | 2023 | 2022 | Increase (Decrease) | % Change | 2023 | 2022 | Increase (Decrease) | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property Data: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of properties | 116 | 116 | — | —% | 3 | 3 | — | —% | 119 | 119 | — | —% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of units | 34,571 | 34,571 | — | —% | 678 | 927 | (249) | (26.9)% | 35,249 | 35,498 | (249) | (0.7)% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Average occupancy | 93.1% | 95.3% | (2.2)% | — | 95.1% | 93.0% | 2.1% | — | 93.1% | 95.2% | (2.1)% | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Average effective monthly rent, per unit | 1,530 | 1,381 | 149 | 10.8% | 1,780 | 1,095 | 685 | 62.5% | 1,535 | 1,374 | 161 | 11.7% | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rental and other property revenue | $ | 156,813 | $ | 145,826 | $ | 10,987 | 7.5 | % | $ | 4,322 | $ | 4,151 | $ | 171 | 4.1 | % | $ | 161,135 | $ | 149,977 | $ | 11,158 | 7.4 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property operating expenses | 57,510 | 54,060 | 3,450 | 6.4 | % | 1,745 | 1,823 | (78) | (4.3) | % | 59,255 | 55,883 | 3,372 | 6.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Operating Income | $ | 99,303 | $ | 91,766 | $ | 7,537 | 8.2 | % | $ | 2,577 | $ | 2,328 | $ | 249 | 10.7 | % | $ | 101,880 | $ | 94,094 | $ | 7,786 | 8.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||
Other Revenue: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other revenue | $ | 239 | $ | 385 | $ | (146) | (37.9) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate and other expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property management expenses | 6,371 | 5,556 | 815 | 14.7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
General and administrative expenses | 8,154 | 7,928 | 226 | 2.9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization expense | 53,536 | 78,174 | (24,638) | (31.5) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Casualty losses (gains), net | 151 | (1,393) | 1,544 | (110.8) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other income, net | 93 | 443 | (350) | (79.0) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss from investments in unconsolidated real estate entities | (776) | (63) | (713) | 1131.7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | (22,124) | (20,531) | (1,593) | 7.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Merger and integration costs | — | (1,895) | 1,895 | (100.0) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gain on sale of real estate assets, net | 985 | 94,712 | (93,727) | (99.0) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring costs | (3,213) | — | (3,213) | 100.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | $ | 8,872 | $ | 76,880 | $ | (68,008) | (88.5) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income allocated to noncontrolling interests | (224) | (2,280) | 2,056 | (90.2) | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income available to common shares | $ | 8,648 | $ | 74,600 | $ | (65,952) | (88.4) | % |
For the Three Months Ended March 31, 2023 | For the Three Months Ended March 31, 2022 | |||||||||||||||||||||||||
Amount | Per Share(1) | Amount | Per Share(2) | |||||||||||||||||||||||
Funds From Operations (FFO): | ||||||||||||||||||||||||||
Net income | $ | 8,872 | $ | 0.04 | $ | 76,880 | $ | 0.34 | ||||||||||||||||||
Adjustments: | ||||||||||||||||||||||||||
Real estate depreciation and amortization | 53,287 | 0.23 | 77,943 | 0.34 | ||||||||||||||||||||||
Our share of real estate depreciation and amortization from investments in unconsolidated real estate entities | 418 | — | — | — | ||||||||||||||||||||||
Gain on sale of real estate assets net, excluding prepayment gains | (314) | — | (94,712) | (0.42) | ||||||||||||||||||||||
FFO | $ | 62,263 | $ | 0.27 | $ | 60,111 | $ | 0.26 | ||||||||||||||||||
Core Funds From Operations (CFFO): | ||||||||||||||||||||||||||
FFO | $ | 62,263 | $ | 0.27 | $ | 60,111 | $ | 0.26 | ||||||||||||||||||
Adjustments: | ||||||||||||||||||||||||||
Other depreciation and amortization | 249 | — | 231 | — | ||||||||||||||||||||||
Casualty losses (gains), net | 151 | — | (1,393) | (0.01) | ||||||||||||||||||||||
Loan (premium accretion) discount amortization, net | (2,755) | (0.01) | (2,754) | (0.01) | ||||||||||||||||||||||
Prepayment (gains) losses on asset dispositions | (670) | — | — | — | ||||||||||||||||||||||
Other expense (income) | 42 | — | (380) | — | ||||||||||||||||||||||
Merger and integration costs | — | — | 1,895 | 0.01 | ||||||||||||||||||||||
Restructuring costs | 3,213 | 0.01 | — | — | ||||||||||||||||||||||
CFFO | $ | 62,493 | $ | 0.27 | $ | 57,710 | $ | 0.25 |
Three Months Ended March 31, | |||||||||||||||||
2023 | 2022 | % change | |||||||||||||||
Net income (loss) | $ | 8,872 | $ | 76,880 | (88.5) | % | |||||||||||
Other revenue | (239) | (385) | (37.9) | % | |||||||||||||
Property management expenses | 6,371 | 5,556 | 14.7 | % | |||||||||||||
General and administrative expenses | 8,154 | 7,928 | 2.9 | % | |||||||||||||
Depreciation and amortization expense | 53,536 | 78,174 | (31.5) | % | |||||||||||||
Casualty losses (gains), net | 151 | (1,393) | (110.8) | % | |||||||||||||
Interest expense | 22,124 | 20,531 | 7.8 | % | |||||||||||||
Gain on sale of real estate assets, net | (985) | (94,712) | (99.0) | % | |||||||||||||
Other income, net | (93) | (443) | (79.0) | % | |||||||||||||
Loss from investments in unconsolidated real estate entities | 776 | 63 | 1131.7 | % | |||||||||||||
Merger and integration costs | — | 1,895 | (100.0) | % | |||||||||||||
Restructuring costs | 3,213 | — | 100.0 | % | |||||||||||||
NOI | 101,880 | 94,094 | 8.3 | % | |||||||||||||
Less: Non same-store portfolio NOI | 2,577 | 2,328 | 10.7 | % | |||||||||||||
Same-store portfolio NOI (a) | $ | 99,303 | $ | 91,766 | 8.2 | % |
Three Months Ended March 31,(a) | |||||||||||||||||
2023 | 2022 | % change | |||||||||||||||
Revenue: | |||||||||||||||||
Rental and other property revenue | $ | 156,813 | $ | 145,826 | 7.5 | % | |||||||||||
Property Operating Expenses | |||||||||||||||||
Real estate taxes | 19,609 | 19,390 | 1.1 | % | |||||||||||||
Property insurance | 3,191 | 2,842 | 12.3 | % | |||||||||||||
Personnel expenses | 12,013 | 12,344 | (2.7) | % | |||||||||||||
Utilities | 8,036 | 7,464 | 7.7 | % | |||||||||||||
Repairs and maintenance | 5,882 | 4,275 | 37.6 | % | |||||||||||||
Contract services | 5,480 | 4,867 | 12.6 | % | |||||||||||||
Advertising expenses | 1,370 | 1,222 | 12.1 | % | |||||||||||||
Other expenses | 1,929 | 1,656 | 16.5 | % | |||||||||||||
Total property operating expenses | 57,510 | 54,060 | 6.4 | % | |||||||||||||
Net operating income | $ | 99,303 | $ | 91,766 | 8.2 | % |
NOI Margin | 63.3 | % | 62.9 | % | 0.4 | % | |||||||||||
Average Occupancy | 93.1 | % | 95.3 | % | (2.2) | % |
Average effective monthly rent, per unit | $ | 1,530 | $ | 1,381 | 10.8 | % |
For the Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Cash flow provided by operating activities | $ | 46,911 | $ | 40,580 | |||||||
Cash flow (used in) provided by investing activities | (19,521) | 127,066 | |||||||||
Cash flow used in financing activities | (36,574) | (182,557) | |||||||||
Net change in cash and cash equivalents, and restricted cash | (9,184) | (14,911) | |||||||||
Cash and cash equivalents, and restricted cash, beginning of period | 44,017 | 65,671 | |||||||||
Cash and cash equivalents, and restricted cash, end of the period | $ | 34,833 | $ | 50,760 |
Period | Total Number of Shares Purchased | Price Paid per Share (1) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (2) | ||||||||||||||||||||||
January 2023 | 4,694 | $ | 17.68 | — | $ | 250,000 | ||||||||||||||||||||
February 2023 | — | — | — | 250,000 | ||||||||||||||||||||||
March 2023 | 31,415 | 16.31 | — | 250,000 | ||||||||||||||||||||||
Total | 36,109 | $ | 16.49 | — |
2.1 | |||||
3.2 | |||||
31.1 | |||||
31.2 | |||||
32.1 | |||||
32.2 | |||||
101 | iXBRL (Inline eXtensible Business Reporting Language). The following materials, formatted in iXBRL: (i) Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022, (ii) Condensed Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022, (iii) Condensed Consolidated Statements of Comprehensive Income (Loss) for the three months ended March 31, 2023 and 2022, (iv) Condensed Consolidated Statements of Changes in Equity for the three months ended March 31, 2023 and 2022, (v) Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 and (vi) notes to the condensed consolidated financial statements as of March 31, 2023. | ||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Independence Realty Trust, Inc. | ||||||||
Date: April 28, 2023 | By: | /s/ SCOTT F. SCHAEFFER | ||||||
Scott F. Schaeffer | ||||||||
Chair of the Board and Chief Executive Officer | ||||||||
(Principal Executive Officer) | ||||||||
Date: April 28, 2023 | By: | /s/ JAMES J. SEBRA | ||||||
James J. Sebra | ||||||||
Chief Financial Officer and Treasurer | ||||||||
(Principal Financial Officer) | ||||||||
Date: April 28, 2023 | By: | /s/ JASON R. DELOZIER | ||||||
Jason R. Delozier | ||||||||
Chief Accounting Officer | ||||||||
(Principal Accounting Officer) |
By: | /s/ SCOTT F. SCHAEFFER | |||||||
Scott F. Schaeffer | ||||||||
Chair of the Board and Chief Executive Officer (Principal Executive Officer) |
By: | /s/ JAMES J. SEBRA | |||||||
James J. Sebra | ||||||||
Chief Financial Officer and Treasurer (Principal Financial Officer) |
By: | /s/ SCOTT F. SCHAEFFER | |||||||
Scott F. Schaeffer | ||||||||
Chair of the Board and Chief Executive Officer (Principal Executive Officer) |
By: | /s/ JAMES J. SEBRA | |||||||
James J. Sebra | ||||||||
Chief Financial Officer and Treasurer (Principal Financial Officer) |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Intangible assets, accumulated amortization | $ 0 | $ 700 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 224,556,870 | 224,064,940 |
Common stock, shares outstanding (in shares) | 224,556,870 | 224,064,940 |
Unvested restricted common share awards (in shares) | 274,259 | 232,134 |
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 8,872 | $ 76,880 |
Other comprehensive (loss) income: | ||
Change in fair value of interest rate hedges | (13,667) | 24,710 |
Realized gains (losses) on interest rate hedges reclassified to earnings | 3,377 | (2,120) |
Total other comprehensive (loss) income | (10,290) | 22,590 |
Comprehensive (loss) income before allocation to noncontrolling interests | (1,418) | 99,470 |
Allocation to noncontrolling interests | 65 | (2,972) |
Comprehensive (loss) income | $ (1,353) | $ 96,498 |
Condensed Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Stockholders' Equity [Abstract] | ||
Common dividends declared per share (in dollars per share) | $ 0.14 | $ 0.12 |
Distribution to noncontrolling interest declared per share (in dollars per share) | $ 0.14 | $ 0.12 |
Organization |
3 Months Ended |
---|---|
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | NOTE 1: Organization Independence Realty Trust, Inc. (“IRT”), is a self-administered and self-managed Maryland real estate investment trust (“REIT”) which was formed on March 26, 2009. Our primary purposes are to acquire, own, operate, improve and manage multifamily apartment communities in non-gateway markets. As of March 31, 2023, we owned and operated 119 (unaudited) multifamily apartment properties that contain 35,249 (unaudited) units across non-gateway U.S. markets including Atlanta, Columbus, Dallas, Denver, Houston, Indianapolis, Nashville, Oklahoma City, Raleigh-Durham, and Tampa. In addition, as of March 31, 2023, we owned interests in five unconsolidated joint ventures that are developing multifamily apartment communities. We own all of our assets and conduct substantially all of our operations through Independence Realty Operating Partnership, LP (“IROP”), of which we are the sole general partner. As used herein, the terms “we,” “our” and “us” refer to IRT and, as required by context, IROP and their subsidiaries.
|
Summary of Significant Accounting Policies |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | NOTE 2: Summary of Significant Accounting Policies a. Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared by management in accordance with generally accepted accounting principles in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations, although we believe that the included disclosures are adequate to make the information presented not misleading. The unaudited interim condensed consolidated financial statements should be read in conjunction with our audited financial statements as of and for the year ended December 31, 2022 included in our 2022 Annual Report on Form 10-K. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our condensed consolidated financial position and condensed consolidated results of operations and cash flows are included. The results of operations for the interim periods presented are not necessarily indicative of the results for the full year. The Company evaluated subsequent events through the date its financial statements were issued. No significant recognized or non-recognized subsequent events were noted other than those described in the footnotes. b. Principles of Consolidation The condensed consolidated financial statements reflect our accounts and the accounts of IROP and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Pursuant to the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification Topic 810, “Consolidation”, IROP is considered a variable interest entity of which we are the primary beneficiary. As our significant asset is our investment in IROP, substantially all of our assets and liabilities represent the assets and liabilities of IROP. c. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. d. Cash and Cash Equivalents Cash and cash equivalents include cash held in banks and highly liquid investments with original maturities of three months or less when purchased. Cash, including amounts restricted, may at times exceed the Federal Deposit Insurance Corporation deposit insurance limit of $250 per institution. We mitigate credit risk by placing cash and cash equivalents with major financial institutions. To date, we have not experienced any losses on cash and cash equivalents. e. Restricted Cash Restricted cash includes escrows of our funds held by lenders to fund certain expenditures, such as real estate taxes and insurance, or to be released at our discretion upon the occurrence of certain pre-specified events. As of March 31, 2023 and December 31, 2022, we had $22,385 and $27,933, respectively, of restricted cash. f. Investments in Real Estate Investments in real estate are recorded at cost less accumulated depreciation. Costs, including internal costs, that both add value and appreciably extend the useful life of an asset are capitalized. Expenditures for repairs and maintenance are expensed as incurred. Investments in real estate are classified as held for sale in the period in which certain criteria are met including when the sale of the asset is probable, and actions required to complete the plan of sale indicate that it is unlikely that significant changes to the plan of sale will be made or the plan of sale will be withdrawn. Allocation of Purchase Price of Acquired Assets In accordance with FASB ASC Topic 805 (“ASC 805”), we evaluate our real estate acquisitions to determine if they should be accounted for as a business or as a group of assets. The evaluation includes an initial screen to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single asset or group of similar assets. If the screen is met, the acquisition is not a business. The properties we have acquired met the screen test and are accounted for as asset acquisitions. Under asset acquisition accounting, the costs to acquire real estate, including transaction costs related to the acquisition, are accumulated and then allocated to the individual assets and liabilities acquired based upon their relative fair value. Transaction costs and fees incurred related to the financing of an acquisition are capitalized and amortized over the life of the related financing. We estimate the fair value of acquired tangible assets (consisting of land, building and improvements), identified intangible assets (consisting of in-place leases), and assumed debt at the date of acquisition, based on the evaluation of information and estimates available at that date. The aggregate value of in-place leases is determined by evaluating various factors, including the terms of the leases that are in place and assumed lease-up periods. The value assigned to these intangible assets is amortized over the assumed lease up period, typically six months. During the three months ended March 31, 2023 and 2022, we did not acquire any in-place leases. For the three months ended March 31, 2023 and 2022, we recorded $399 and $29,082, respectively, of amortization for intangible assets. For the three months ended March 31, 2023 and 2022, we wrote-off fully amortized intangible assets of $1,099 and $0, respectively. Business Combinations For properties we acquire or transactions we enter into that are accounted for as business combinations, we apply the acquisition method of accounting under ASC 805, which requires the identification of the acquiror, the determination of the acquisition date, and the recognition and measurement, at fair value, of the assets acquired and liabilities assumed. To the extent that the fair value of net assets acquired differs from the fair value of consideration paid, ASC 805 requires the recognition of goodwill or a gain from a bargain purchase price, if any. Our merger with Steadfast Apartment REIT, Inc. on December 16, 2021 was accounted for as a business combination. For the three months ended March 31, 2023 and 2022, we incurred merger and integration costs of $0 and $1,895, respectively. These amounts were expensed as incurred, and are included in the condensed consolidated statements of operations in the item titled “Merger and integration costs”, and primarily consist of advisory fees, employee severance costs, and attorney fees. Impairment of Long-Lived Assets Management evaluates the recoverability of our investment in real estate assets, including related identifiable intangible assets, in accordance with FASB ASC Topic 360, “Property, Plant and Equipment”. This statement requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that recoverability of the assets is not assured. Management reviews our long-lived assets on an ongoing basis and evaluates the recoverability of the carrying value when there is an indicator of impairment. An impairment charge is recorded when it is determined that the carrying value of the asset exceeds the fair value. The estimated cash flows used for the impairment analysis and the determination of estimated fair value are based on our plans for the respective assets (e.g., hold period) and our views of market and economic conditions. The estimates consider matters such as current and historical rental rates, occupancies for the respective and/or comparable properties, and recent sales data for comparable properties. Changes in estimated future cash flows due to changes in our plans or views of market and economic conditions could result in recognition of impairment losses, which, under the applicable accounting guidance, could be substantial. For the three months ended March 31, 2023 and 2022, we did not incur an impairment charge. Depreciation Expense Depreciation expense for real estate assets is computed using a straight-line method based on a life of 40 years for buildings and improvements and to ten years for furniture, fixtures, and equipment. For the three months ended March 31, 2023 and 2022, we recorded $52,887 and $49,092 of depreciation expense, respectively. During the three months ended March 31, 2023 and 2022, we wrote-off fully depreciated fixed assets of $2,920 and $1,160, respectively. Casualty Related Costs Occasionally, we incur losses at our communities from wind storms, floods, fires and similar hazards. Sometimes, a portion of these losses are not fully covered by our insurance policies due to deductibles. In these cases, we estimate the carrying value of the damaged property and record a casualty loss for the difference between the estimated carrying value and the insurance proceeds. Any amount of insurance recovery in excess of the amount of the losses incurred is considered a gain contingency and is recorded in casualty losses (gains), net when the proceeds are received. During the three months ended March 31, 2023 and 2022, we incurred $151 of casualty losses and $1,393 of net casualty gains, respectively. g. Investments in Real Estate Under Development We capitalize direct and indirect project costs incurred during the development period such as construction, insurance, architectural, legal, interest costs, and real estate taxes. At such time as the development is considered substantially complete, the capitalization of certain indirect costs such as real estate taxes, interest costs, and all project-related costs in real estate under development are reclassified to investments in real estate. For the three months ended March 31, 2023 and 2022, we recorded $1,454 and $301, respectively, of capitalized interest expense, on our investments in real estate under development. As of March 31, 2023 and December 31, 2022, the carrying value of our two investments in real estate under development in Denver, Colorado totaled $124,983 and $105,518, respectively, and was recorded as a separate line item in our condensed consolidated balance sheets. h. Investments in Unconsolidated Real Estate Entities We have entered into joint ventures with unrelated third parties to acquire, develop, own, operate, and manage real estate assets. Our joint ventures are funded with a combination of debt and equity. We will consolidate entities that we control as well as any variable interest entity where we are the primary beneficiary. Under the VIE model, we will consolidate an entity when we have the ability to direct the activities of the VIE and the obligations to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, we consolidate an entity when we control the entity through ownership of a majority voting interest. We separately analyzed the initial accounting for each investment in unconsolidated entity and concluded that each is a voting interest entity and is not a VIE. Our equity interest varies for each joint venture between 50% and 90% but, in each case, we share control of the major decisions that most significantly impact the joint ventures with our partners. Since we do not control the joint venture through our ownership interest, they are accounted for under the equity method of accounting, and are included in investments in unconsolidated real estate entities on the condensed consolidated balance sheets. Under the equity method of accounting, the investments are carried at cost plus our share of net earnings or losses. For the three months ended March 31, 2023 and 2022, we recorded $1,006 and $210, respectively, of capitalized interest expense, on our investments in unconsolidated real estate entities in our condensed consolidated balance sheets. i. Revenue and Expenses Rental and Other Property Revenue We apply FASB ASC Topic 842, “Leases” (“ASC 842”) with respect to our accounting for rental income. We primarily lease apartment units under operating leases generally with terms of one year or less. Rental payments are generally due monthly and rental revenues are recognized on an accrual basis when earned. We have elected to account for lease (i.e. fixed payments including base rent) and non-lease components (i.e. tenant reimbursements and certain other service fees) as a single combined operating lease component since (1) the timing and pattern of transfer of the lease and non-lease components is the same, (2) the lease component is the predominant element, and (3) the combined single lease component would be classified as an operating lease. We make ongoing estimates of the collectability of our base rents, tenant reimbursements, and other service fees included within rental and other property revenue. If collectability is not probable, we adjust rental and other property income for the amount of uncollectible revenue. j. Derivative Instruments We may use derivative financial instruments to hedge all or a portion of the interest rate risk associated with our borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with our operating and financial structure, as well as to hedge specific anticipated transactions. While these instruments may impact our periodic cash flows, they benefit us by minimizing the risks and/or costs previously described. The counterparties to these contractual arrangements are major financial institutions with which we and our affiliates may also have other financial relationships. In the event of nonperformance by the counterparties, we are potentially exposed to credit loss. However, because of the high credit ratings of the counterparties, we do not anticipate that any of the counterparties will fail to meet their obligations. In accordance with FASB ASC Topic 815, “Derivatives and Hedging”, we measure each derivative instrument at fair value and record such amounts in our condensed consolidated balance sheets as either an asset or liability. For derivatives designated as cash flow hedges, the changes in the fair value of the effective portions of the derivative are reported in other comprehensive income and changes in the fair value of the ineffective portions of cash flow hedges, if any, are recognized in earnings. For derivatives not designated as hedges, the changes in fair value of the derivative instrument are recognized in earnings. Any derivatives that we designate in hedge relationships are done so at inception. At inception, we determine whether or not the derivative is highly effective in offsetting changes in the designated interest rate risk associated with the identified indebtedness using regression analysis. At each reporting period, we update our regression analysis and use the hypothetical derivative method to measure any ineffectiveness. k. Fair Value of Financial Instruments In accordance with FASB ASC Topic 820, “Fair Value Measurements and Disclosures”, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity for disclosure purposes. Assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their value. Hierarchical levels, as defined in FASB ASC Topic 820, “Fair Value Measurements and Disclosures” and directly related to the amount of subjectivity associated with the inputs to fair valuations of these assets and liabilities, are as follows: •Level 1: Valuations are based on unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. The types of assets carried at Level 1 fair value generally are equity securities listed in active markets. As such, valuations of these investments do not entail a significant degree of judgment. •Level 2: Valuations are based on quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or for which all significant inputs are observable, either directly or indirectly. •Level 3: Inputs are unobservable for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. FASB ASC Topic 825, “Financial Instruments” requires disclosure of the fair value of financial instruments for which it is practicable to estimate that value. Given that cash and cash equivalents and restricted cash are short term in nature with limited fair value volatility, the carrying amount is deemed to be a reasonable approximation of fair value and the fair value input is classified as a Level 1 fair value measurement. The fair value input for derivatives is classified as a Level 2 fair value measurement within the fair value hierarchy. The fair value of our unsecured credit facility, term loans, and mortgage indebtedness is based on a discounted cash flows valuation technique. As this technique utilizes current credit spreads, which are generally unobservable, this is classified as a Level 3 fair value measurement within the fair value hierarchy. We determine appropriate credit spreads based on the type of debt and its maturity. There were no transfers between levels in the fair value hierarchy for the three months ended March 31, 2023. The following table summarizes the carrying amount and the fair value of our financial instruments as of the periods indicated:
l. Deferred Financing Costs Costs incurred in connection with debt financing are deferred and classified within indebtedness and charged to interest expense over the terms of the related debt agreements, under the effective interest method. m. Office Leases In accordance with FASB ASC Topic 842, “Leases”, lessees are required to recognize a right-of-use asset and a lease liability on the balance sheet at the lease commencement date for all leases, except those leases with terms of less than a year. We lease corporate office space under leases with terms of up to 10 years and that may include extension options, but that do not include any residual value guarantees or restrictive covenants. As of March 31, 2023, we had $2,914 of operating lease right-of-use assets and $3,237 of operating lease liabilities related to our corporate office leases. The operating lease right-of-use assets are presented within other assets and the operating lease liabilities are presented within other liabilities in our condensed consolidated balance sheets. We recorded $210 and $461 of total operating lease expense during the three months ended March 31, 2023 and 2022, respectively, which is recorded within property management expense and general and administrative expenses in our condensed consolidated statements of operations. n. Income Taxes We have elected to be taxed as a REIT. Accordingly, we recorded no income tax expense for the three months ended March 31, 2023 and 2022. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our ordinary taxable income to stockholders. As a REIT, we generally are not subject to federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders; however, we believe that we are organized and operate in such a manner as to qualify and maintain treatment as a REIT and intend to operate in such a manner so that we will remain qualified as a REIT for federal income tax purposes. o. Employee Retention Credit Under the terms of the March 27, 2020 Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), we were eligible and applied for assistance in the form of a refundable employee retention credit. Since applicable GAAP guidance is limited, we adopted an accounting policy, in accordance with GAAP, by analogizing to International Accounting Standard 20 “Accounting for Government Grants” to recognize employee retention credits as a reimbursement of payroll related expenses within property operating expenses, property management expenses, and general and administrative expenses in our condensed consolidated statements of operations. During the six months ended December 31, 2022, we received employee retention credit refunds totaling $6,238 and recognized $3,006 in reimbursements of previously paid employer payroll taxes and retention costs in our condensed consolidated statements of operations. The remainder is included in accounts payable and accrued expenses in our condensed consolidated balance sheets and will be recognized on a systematic basis through December 2023 as a reimbursement of payroll related expenses attributable to off-cycle compensation increases awarded to employees beginning in July 2022 and intended to support employee retention during the pandemic and its ongoing effect on the macroeconomic environment. During the three months ended March 31, 2023, we recognized reimbursements of payroll related expenses of $788 in property operating expenses, $195 in property management expenses and $74 in general and administrative expenses. p. Restructuring Costs During the three months ended March 31, 2023, we reorganized certain departments in the organization impacting a limited number of employees. The impacted employees were provided severance packages that included cash severance payments and the accelerated vesting of performance share units and restricted stock awards, as applicable. In accordance with ASC 712 “Compensation – Nonretirement Postemployment Benefits”, we recognized the full amount of restructuring costs of $3,213 during the three months ended March 31, 2023, which was presented in the restructuring costs line on the condensed consolidated statement of operations. q. Recent Accounting Pronouncements Below is a brief description of recent accounting pronouncements that could have a material effect on our financial statements. Adopted Within these Financial Statements In March 2020, the FASB issued an accounting standard classified under FASB ASC Topic 848, “Reference Rate Reform.” The amendments in this update contain practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASC 848 is optional and may be elected over time as reference rate reform activities occur. Beginning in the first quarter of 2020, we elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. We will continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. In December 2022, the FASB issued ASU 2022-06, Deferral of the Sunset Date of Topic 848 (“ASU 2022-06”) which was issued to defer the sunset date of Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform to December 31, 2024. ASU 2022-06 is effective immediately for all companies. ASU 2022-06 has no impact on the Company’s condensed consolidated financial statements for the three months ended March 31, 2023. R
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Investments in Real Estate |
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Investments in Real Estate | NOTE 3: Investments in Real Estate As of March 31, 2023, our investments in real estate consisted of 119 apartment properties (unaudited) that contain 35,249 units (unaudited). The following table summarizes our investments in real estate:
Dispositions On February 28, 2023, we sold Eagle Lake Landing apartments located in Indianapolis, Indiana for $37,300 and recognized a gain on sale of $985.
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Investments in Unconsolidated Real Estate |
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Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in Unconsolidated Real Estate | NOTE 4: Investments in Unconsolidated Real Estate As of March 31, 2023, our investments in unconsolidated real estate entities had aggregate land, building, and construction in progress costs capitalized of $241,114 and aggregate construction debt of $115,882. We do not guarantee any debt, capital payout or other obligations associated with our joint ventures. We recognize earnings or losses from our investments in unconsolidated real estate entities consisting of our proportionate share of the net earnings or losses of the joint ventures. We recognized losses of $776 and $63 from equity method investments during the three months ended March 31, 2023 and 2022, respectively, and these losses were recorded in loss from investments in unconsolidated real estate entities in our condensed consolidated statements of operations. The following table summarizes our investments in unconsolidated real estate entities as of March 31, 2023 and December 31, 2022:
(1)Represents the total number of units after development is complete and each property is placed in service. As of March 31, 2023 178-units (unaudited) at the Virtuoso investment’s development and 199-units (unaudited) at The Crockett are complete and had ongoing operations. We have one year from the delivery date to exercise our purchase option on The Crockett.
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Indebtedness |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indebtedness | NOTE 5: Indebtedness The following tables contain summary information concerning our consolidated indebtedness as of March 31, 2023:
(1)The unsecured revolver total capacity is $500,000, of which $185,478 was outstanding as of March 31, 2023. (2)The secured credit facilities include the PNC secured credit facility ("PNC MCFA") and the Newmark secured credit facility ("Newmark MCFA") of which $76,248 and $540,867 was outstanding as of March 31, 2023, respectively. (3)Represents the weighted average of the contractual interest rates in effect as of quarter end without regard to any interest rate swaps or collars. Our total weighted average effective interest rate for the three months ended March 31, 2023, after giving effect to the impact of interest rate swaps and collars, and excluding the impact of loan premium amortization, discount accretion, and interest capitalization was 4.1%. The following table contains summary information concerning our consolidated indebtedness as of March 31, 2023:
The following table contains summary information concerning our consolidated indebtedness as of December 31, 2022:
(1)The unsecured revolver total capacity was $500,000, of which $165,978 was outstanding as of December 31, 2022. (2)The secured credit facilities include the PNC MCFA and the Newmark MCFA of which $76,248 and $558,880 was outstanding as of December 31, 2022, respectively. (3)Represents the weighted average of the contractual interest rates in effect as of quarter end without regard to any interest rate swaps or collars. Our total weighted average effective interest rate as of the year ended December 31, 2022, after giving effect to the impact of interest rate swaps and collars, and excluding the impact of loan premium amortization and discount accretion was 4.1%. As of March 31, 2023, we were in compliance with all financial covenants contained in the documents governing our indebtedness.
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Derivative Financial Instruments |
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Derivative Financial Instruments | NOTE 6: Derivative Financial Instruments The following table summarizes the aggregate notional amounts and estimated net fair values of our derivative instruments as of March 31, 2023 and December 31, 2022:
Effective interest rate swaps and caps are reported in accumulated other comprehensive income, and the fair value of these hedge agreements is recorded as derivative assets or liabilities on the face of our condensed consolidated balance sheets. For our interest rate swaps and collars that are considered highly effective hedges, we reclassified realized (gains) losses of ($3,377) and $2,120 to earnings within interest expense for the three months ended March 31, 2023 and 2022, and we expect gains of $16,069 to be reclassified out of accumulated other comprehensive (loss) income to earnings over the next 12 months. On March 16, 2023, we entered into an interest rate swap contract with a notional value of $200,000, a strike rate of 3.39% and a maturity date of March 17, 2030. We designated this interest rate swap as a cash flow hedge at inception and determined that the hedge is highly effective in offsetting interest rate fluctuations associated with the identified indebtedness.
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Stockholders' Equity and Noncontrolling Interests |
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Mar. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity and Noncontrolling Interests | NOTE 7: Stockholders' Equity and Noncontrolling Interests Stockholders’ Equity On March 14, 2023, our board of directors declared a dividend of $0.14 per share on our common stock, which was paid on April 21, 2023 to common stockholders of record as of March 31, 2023. On May 18, 2022, our Board of Directors authorized a common stock repurchase program (the "Stock Repurchase Program") covering up to $250,000 in shares of our common stock. Under the Stock Repurchase Program, we, in our discretion, may purchase our shares from time to time in the open market or in privately negotiated transactions. The amount and timing of the purchases will depend on a number of factors, including the price and availability of our shares, trading volumes and general market conditions. The Stock Repurchase Program has no time limit and may be suspended or discontinued at any time. During the three months ended March 31, 2023, we had no repurchases of shares under the Stock Repurchase Program. As of March 31, 2023, we had $250,000 in shares of our common stock remaining authorized for purchase under the Stock Repurchase Program. On November 13, 2020, we entered into an equity distribution agreement pursuant to which we may from time to time offer and sell shares of our common stock having an aggregate offering price of up to $150,000 (the “ATM Program”) in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended. Under the ATM Program, we may also enter into one or more forward sale transactions for the sale of shares of our common stock on a forward basis. There were no forward sale transactions that had not settled as of March 31, 2023. As of March 31, 2023, shares of our common stock having an aggregate offering price of up to approximately $56,836 remained available for issuance under the ATM Program. Noncontrolling Interest During the three months ended March 31, 2023, holders of IROP units exchanged 144,600 units for 144,600 shares of our common stock. As of March 31, 2023, 5,946,571 IROP units held by unaffiliated third parties remain outstanding. On March 14, 2023, our board of directors declared a dividend of $0.14 per unit, which was paid on April 21, 2023 to IROP LP unit holders of record as of March 31, 2023.
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Equity Compensation Plans |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Compensation Plans | NOTE 8: Equity Compensation Plans Long Term Incentive Plan On May 18, 2022, our stockholders approved our 2022 Long Term Incentive Plan which provides for grants of equity and equity-based awards to our employees, officers, directors, consultants and other service providers, and such awards may take the form of restricted or unrestricted shares of common stock, non-qualified stock options, incentive stock options, restricted stock units (“RSUs"), stock appreciation rights, dividend equivalents and other equity and cash-based awards. A maximum of 8,000,000 shares of our common stock (plus up to an additional 1,280,610 shares of our common stock, to the extent that shares subject to outstanding awards under the prior plan are recycled into the 2022 Incentive Plan) may be awarded, subject to customary adjustment for stock splits, reverse stock splits and similar corporate events or transactions affecting shares of our common stock. Under the Incentive Plan, we have granted restricted shares, RSUs, and PSUs. These awards generally vest or vested over a -to four-year period. In addition, we have granted unrestricted shares to our non-employee directors. These awards generally vest or vested immediately. A summary of restricted common share award and RSU activity is presented below.
On February 7, 2023, our compensation committee awarded 216,795 PSUs to our executive officers. The number of PSUs earned will be based on attainment of certain performance criteria over a three-year period, with the actual number of shares issuable ranging between 0% and 150% of the number of PSUs granted. Half of any PSUs earned will vest, and shares will be issued in respect thereof, immediately following the end of the three-year performance period; the remaining half of any PSUs earned will vest, and shares will be issued in respect thereof, after an additional one-year period of service. During the three months ended March 31, 2023 and 2022, a portion of the RSUs and PSUs granted were issued to employees who are retirement eligible. The fact that the grantees are retirement eligible resulted in immediate recognition of the associated stock-based compensation expense totaling $2,677 and $2,422, respectively.
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Earnings Per Share |
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Earnings Per Share | NOTE 9: Earnings Per Share The following table presents a reconciliation of basic and diluted earnings (loss) per share for the three months ended March 31, 2023 and 2022:
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Other Disclosures |
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Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Other Disclosures | NOTE 10: Other Disclosures Litigation We are subject to various legal proceedings and claims that arise in the ordinary course of our business operations. Matters which arise out of allegations of bodily injury, property damage, and employment practices are generally covered by insurance. While the resolution of these matters cannot be predicted with certainty, we currently believe the final outcome of such matters will not have a material adverse effect on our financial position, results of operations or cash flows. Loss Contingencies We record an accrual for loss contingencies when a loss is probable and the amount of the loss can be reasonably estimated. Management reviews these accruals quarterly and makes revisions based on changes in facts and circumstances. When a loss contingency is not both probable and reasonably estimable, management does not accrue the loss. However, if the loss (or an additional loss in excess of an earlier accrual) is at least a reasonable possibility and material, then management discloses a reasonable estimate of the possible loss, or range of loss, if such reasonable estimate can be made. If we cannot make a reasonable estimate of the possible loss, or range of loss, then a statement to that effect is disclosed.
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Summary of Significant Accounting Policies (Policies) |
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Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of PresentationThe accompanying unaudited interim condensed consolidated financial statements have been prepared by management in accordance with generally accepted accounting principles in the United States (“GAAP”). Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations, although we believe that the included disclosures are adequate to make the information presented not misleading. The unaudited interim condensed consolidated financial statements should be read in conjunction with our audited financial statements as of and for the year ended December 31, 2022 included in our 2022 Annual Report on Form 10-K. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our condensed consolidated financial position and condensed consolidated results of operations and cash flows are included. The results of operations for the interim periods presented are not necessarily indicative of the results for the full year. The Company evaluated subsequent events through the date its financial statements were issued. |
Principles of Consolidation | Principles of ConsolidationThe condensed consolidated financial statements reflect our accounts and the accounts of IROP and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Pursuant to the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification Topic 810, “Consolidation”, IROP is considered a variable interest entity of which we are the primary beneficiary. As our significant asset is our investment in IROP, substantially all of our assets and liabilities represent the assets and liabilities of IROP. |
Use of Estimates | Use of EstimatesThe preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash EquivalentsCash and cash equivalents include cash held in banks and highly liquid investments with original maturities of three months or less when purchased. Cash, including amounts restricted, may at times exceed the Federal Deposit Insurance Corporation deposit insurance limit of $250 per institution. We mitigate credit risk by placing cash and cash equivalents with major financial institutions. To date, we have not experienced any losses on cash and cash equivalents. |
Restricted Cash | Restricted CashRestricted cash includes escrows of our funds held by lenders to fund certain expenditures, such as real estate taxes and insurance, or to be released at our discretion upon the occurrence of certain pre-specified events. |
Investments in Real Estate | Investments in Real Estate Investments in real estate are recorded at cost less accumulated depreciation. Costs, including internal costs, that both add value and appreciably extend the useful life of an asset are capitalized. Expenditures for repairs and maintenance are expensed as incurred. Investments in real estate are classified as held for sale in the period in which certain criteria are met including when the sale of the asset is probable, and actions required to complete the plan of sale indicate that it is unlikely that significant changes to the plan of sale will be made or the plan of sale will be withdrawn. Allocation of Purchase Price of Acquired Assets In accordance with FASB ASC Topic 805 (“ASC 805”), we evaluate our real estate acquisitions to determine if they should be accounted for as a business or as a group of assets. The evaluation includes an initial screen to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single asset or group of similar assets. If the screen is met, the acquisition is not a business. The properties we have acquired met the screen test and are accounted for as asset acquisitions. Under asset acquisition accounting, the costs to acquire real estate, including transaction costs related to the acquisition, are accumulated and then allocated to the individual assets and liabilities acquired based upon their relative fair value. Transaction costs and fees incurred related to the financing of an acquisition are capitalized and amortized over the life of the related financing. We estimate the fair value of acquired tangible assets (consisting of land, building and improvements), identified intangible assets (consisting of in-place leases), and assumed debt at the date of acquisition, based on the evaluation of information and estimates available at that date. The aggregate value of in-place leases is determined by evaluating various factors, including the terms of the leases that are in place and assumed lease-up periods. The value assigned to these intangible assets is amortized over the assumed lease up period, typically six months. During the three months ended March 31, 2023 and 2022, we did not acquire any in-place leases. For the three months ended March 31, 2023 and 2022, we recorded $399 and $29,082, respectively, of amortization for intangible assets. For the three months ended March 31, 2023 and 2022, we wrote-off fully amortized intangible assets of $1,099 and $0, respectively. Business Combinations For properties we acquire or transactions we enter into that are accounted for as business combinations, we apply the acquisition method of accounting under ASC 805, which requires the identification of the acquiror, the determination of the acquisition date, and the recognition and measurement, at fair value, of the assets acquired and liabilities assumed. To the extent that the fair value of net assets acquired differs from the fair value of consideration paid, ASC 805 requires the recognition of goodwill or a gain from a bargain purchase price, if any. Our merger with Steadfast Apartment REIT, Inc. on December 16, 2021 was accounted for as a business combination. For the three months ended March 31, 2023 and 2022, we incurred merger and integration costs of $0 and $1,895, respectively. These amounts were expensed as incurred, and are included in the condensed consolidated statements of operations in the item titled “Merger and integration costs”, and primarily consist of advisory fees, employee severance costs, and attorney fees. Impairment of Long-Lived Assets Management evaluates the recoverability of our investment in real estate assets, including related identifiable intangible assets, in accordance with FASB ASC Topic 360, “Property, Plant and Equipment”. This statement requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that recoverability of the assets is not assured. Management reviews our long-lived assets on an ongoing basis and evaluates the recoverability of the carrying value when there is an indicator of impairment. An impairment charge is recorded when it is determined that the carrying value of the asset exceeds the fair value. The estimated cash flows used for the impairment analysis and the determination of estimated fair value are based on our plans for the respective assets (e.g., hold period) and our views of market and economic conditions. The estimates consider matters such as current and historical rental rates, occupancies for the respective and/or comparable properties, and recent sales data for comparable properties. Changes in estimated future cash flows due to changes in our plans or views of market and economic conditions could result in recognition of impairment losses, which, under the applicable accounting guidance, could be substantial. For the three months ended March 31, 2023 and 2022, we did not incur an impairment charge. Depreciation Expense Depreciation expense for real estate assets is computed using a straight-line method based on a life of 40 years for buildings and improvements and to ten years for furniture, fixtures, and equipment. For the three months ended March 31, 2023 and 2022, we recorded $52,887 and $49,092 of depreciation expense, respectively. During the three months ended March 31, 2023 and 2022, we wrote-off fully depreciated fixed assets of $2,920 and $1,160, respectively. Casualty Related Costs Occasionally, we incur losses at our communities from wind storms, floods, fires and similar hazards. Sometimes, a portion of these losses are not fully covered by our insurance policies due to deductibles. In these cases, we estimate the carrying value of the damaged property and record a casualty loss for the difference between the estimated carrying value and the insurance proceeds. Any amount of insurance recovery in excess of the amount of the losses incurred is considered a gain contingency and is recorded in casualty losses (gains), net when the proceeds are received. During the three months ended March 31, 2023 and 2022, we incurred $151 of casualty losses and $1,393 of net casualty gains, respectively.
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Investments in Real Estate Under Development | Investments in Real Estate Under DevelopmentWe capitalize direct and indirect project costs incurred during the development period such as construction, insurance, architectural, legal, interest costs, and real estate taxes. At such time as the development is considered substantially complete, the capitalization of certain indirect costs such as real estate taxes, interest costs, and all project-related costs in real estate under development are reclassified to investments in real estate. |
Investments in Unconsolidated Real Estate Entities | Investments in Unconsolidated Real Estate EntitiesWe have entered into joint ventures with unrelated third parties to acquire, develop, own, operate, and manage real estate assets. Our joint ventures are funded with a combination of debt and equity. We will consolidate entities that we control as well as any variable interest entity where we are the primary beneficiary. Under the VIE model, we will consolidate an entity when we have the ability to direct the activities of the VIE and the obligations to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, we consolidate an entity when we control the entity through ownership of a majority voting interest. We separately analyzed the initial accounting for each investment in unconsolidated entity and concluded that each is a voting interest entity and is not a VIE. Our equity interest varies for each joint venture between 50% and 90% but, in each case, we share control of the major decisions that most significantly impact the joint ventures with our partners. Since we do not control the joint venture through our ownership interest, they are accounted for under the equity method of accounting, and are included in investments in unconsolidated real estate entities on the condensed consolidated balance sheets. Under the equity method of accounting, the investments are carried at cost plus our share of net earnings or losses. |
Revenue and Expenses | Revenue and Expenses Rental and Other Property Revenue We apply FASB ASC Topic 842, “Leases” (“ASC 842”) with respect to our accounting for rental income. We primarily lease apartment units under operating leases generally with terms of one year or less. Rental payments are generally due monthly and rental revenues are recognized on an accrual basis when earned. We have elected to account for lease (i.e. fixed payments including base rent) and non-lease components (i.e. tenant reimbursements and certain other service fees) as a single combined operating lease component since (1) the timing and pattern of transfer of the lease and non-lease components is the same, (2) the lease component is the predominant element, and (3) the combined single lease component would be classified as an operating lease. We make ongoing estimates of the collectability of our base rents, tenant reimbursements, and other service fees included within rental and other property revenue. If collectability is not probable, we adjust rental and other property income for the amount of uncollectible revenue.
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Derivative Instruments | Derivative Instruments We may use derivative financial instruments to hedge all or a portion of the interest rate risk associated with our borrowings. The principal objective of such arrangements is to minimize the risks and/or costs associated with our operating and financial structure, as well as to hedge specific anticipated transactions. While these instruments may impact our periodic cash flows, they benefit us by minimizing the risks and/or costs previously described. The counterparties to these contractual arrangements are major financial institutions with which we and our affiliates may also have other financial relationships. In the event of nonperformance by the counterparties, we are potentially exposed to credit loss. However, because of the high credit ratings of the counterparties, we do not anticipate that any of the counterparties will fail to meet their obligations. In accordance with FASB ASC Topic 815, “Derivatives and Hedging”, we measure each derivative instrument at fair value and record such amounts in our condensed consolidated balance sheets as either an asset or liability. For derivatives designated as cash flow hedges, the changes in the fair value of the effective portions of the derivative are reported in other comprehensive income and changes in the fair value of the ineffective portions of cash flow hedges, if any, are recognized in earnings. For derivatives not designated as hedges, the changes in fair value of the derivative instrument are recognized in earnings. Any derivatives that we designate in hedge relationships are done so at inception. At inception, we determine whether or not the derivative is highly effective in offsetting changes in the designated interest rate risk associated with the identified indebtedness using regression analysis. At each reporting period, we update our regression analysis and use the hypothetical derivative method to measure any ineffectiveness.
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Fair Value of Financial Instruments | Fair Value of Financial InstrumentsIn accordance with FASB ASC Topic 820, “Fair Value Measurements and Disclosures”, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity for disclosure purposes. Assets and liabilities recorded at fair value in our condensed consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their value. Hierarchical levels, as defined in FASB ASC Topic 820, “Fair Value Measurements and Disclosures” and directly related to the amount of subjectivity associated with the inputs to fair valuations of these assets and liabilities, are as follows: •Level 1: Valuations are based on unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. The types of assets carried at Level 1 fair value generally are equity securities listed in active markets. As such, valuations of these investments do not entail a significant degree of judgment. •Level 2: Valuations are based on quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active or for which all significant inputs are observable, either directly or indirectly. •Level 3: Inputs are unobservable for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. FASB ASC Topic 825, “Financial Instruments” requires disclosure of the fair value of financial instruments for which it is practicable to estimate that value. Given that cash and cash equivalents and restricted cash are short term in nature with limited fair value volatility, the carrying amount is deemed to be a reasonable approximation of fair value and the fair value input is classified as a Level 1 fair value measurement. The fair value input for derivatives is classified as a Level 2 fair value measurement within the fair value hierarchy. The fair value of our unsecured credit facility, term loans, and mortgage indebtedness is based on a discounted cash flows valuation technique. As this technique utilizes current credit spreads, which are generally unobservable, this is classified as a Level 3 fair value measurement within the fair value hierarchy. We determine appropriate credit spreads based on the type of debt and its maturity.
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Deferred Financing Costs | Deferred Financing CostsCosts incurred in connection with debt financing are deferred and classified within indebtedness and charged to interest expense over the terms of the related debt agreements, under the effective interest method. |
Office Leases | Office LeasesIn accordance with FASB ASC Topic 842, “Leases”, lessees are required to recognize a right-of-use asset and a lease liability on the balance sheet at the lease commencement date for all leases, except those leases with terms of less than a year. We lease corporate office space under leases with terms of up to 10 years and that may include extension options, but that do not include any residual value guarantees or restrictive covenants. As of March 31, 2023, we had $2,914 of operating lease right-of-use assets and $3,237 of operating lease liabilities related to our corporate office leases. The operating lease right-of-use assets are presented within other assets and the operating lease liabilities are presented within other liabilities in our condensed consolidated balance sheets. We recorded $210 and $461 of total operating lease expense during the three months ended March 31, 2023 and 2022, respectively, which is recorded within property management expense and general and administrative expenses in our condensed consolidated statements of operations. |
Income Taxes | Income Taxes We have elected to be taxed as a REIT. Accordingly, we recorded no income tax expense for the three months ended March 31, 2023 and 2022. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our ordinary taxable income to stockholders. As a REIT, we generally are not subject to federal income tax on taxable income that we distribute to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income taxes on our taxable income at regular corporate rates and will not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year during which qualification is lost unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders; however, we believe that we are organized and operate in such a manner as to qualify and maintain treatment as a REIT and intend to operate in such a manner so that we will remain qualified as a REIT for federal income tax purposes.
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Employee Retention Credit | Employee Retention CreditUnder the terms of the March 27, 2020 Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), we were eligible and applied for assistance in the form of a refundable employee retention credit. Since applicable GAAP guidance is limited, we adopted an accounting policy, in accordance with GAAP, by analogizing to International Accounting Standard 20 “Accounting for Government Grants” to recognize employee retention credits as a reimbursement of payroll related expenses within property operating expenses, property management expenses, and general and administrative expenses in our condensed consolidated statements of operations. During the six months ended December 31, 2022, we received employee retention credit refunds totaling $6,238 and recognized $3,006 in reimbursements of previously paid employer payroll taxes and retention costs in our condensed consolidated statements of operations. The remainder is included in accounts payable and accrued expenses in our condensed consolidated balance sheets and will be recognized on a systematic basis through December 2023 as a reimbursement of payroll related expenses attributable to off-cycle compensation increases awarded to employees beginning in July 2022 and intended to support employee retention during the pandemic and its ongoing effect on the macroeconomic environment. During the three months ended March 31, 2023, we recognized reimbursements of payroll related expenses of $788 in property operating expenses, $195 in property management expenses and $74 in general and administrative expenses. |
Restructuring Costs | Restructuring CostsDuring the three months ended March 31, 2023, we reorganized certain departments in the organization impacting a limited number of employees. The impacted employees were provided severance packages that included cash severance payments and the accelerated vesting of performance share units and restricted stock awards, as applicable. In accordance with ASC 712 “Compensation – Nonretirement Postemployment Benefits”, we recognized the full amount of restructuring costs of $3,213 during the three months ended March 31, 2023, which was presented in the restructuring costs line on the condensed consolidated statement of operations. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Below is a brief description of recent accounting pronouncements that could have a material effect on our financial statements. Adopted Within these Financial Statements In March 2020, the FASB issued an accounting standard classified under FASB ASC Topic 848, “Reference Rate Reform.” The amendments in this update contain practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASC 848 is optional and may be elected over time as reference rate reform activities occur. Beginning in the first quarter of 2020, we elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. We will continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. In December 2022, the FASB issued ASU 2022-06, Deferral of the Sunset Date of Topic 848 (“ASU 2022-06”) which was issued to defer the sunset date of Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform to December 31, 2024. ASU 2022-06 is effective immediately for all companies. ASU 2022-06 has no impact on the Company’s condensed consolidated financial statements for the three months ended March 31, 2023.
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Summary of Significant Accounting Policies (Tables) |
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Schedule of Carrying Amount and Fair Value of Financial Instrument | The following table summarizes the carrying amount and the fair value of our financial instruments as of the periods indicated:
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Investments in Real Estate (Tables) |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Investments in Real Estate | The following table summarizes our investments in real estate:
|
Investments in Unconsolidated Real Estate (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Investments in Unconsolidated Real Estate | The following table summarizes our investments in unconsolidated real estate entities as of March 31, 2023 and December 31, 2022:
(1)Represents the total number of units after development is complete and each property is placed in service. As of March 31, 2023 178-units (unaudited) at the Virtuoso investment’s development and 199-units (unaudited) at The Crockett are complete and had ongoing operations. We have one year from the delivery date to exercise our purchase option on The Crockett.
|
Indebtedness (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Information Concerning Indebtedness | The following tables contain summary information concerning our consolidated indebtedness as of March 31, 2023:
(1)The unsecured revolver total capacity is $500,000, of which $185,478 was outstanding as of March 31, 2023. (2)The secured credit facilities include the PNC secured credit facility ("PNC MCFA") and the Newmark secured credit facility ("Newmark MCFA") of which $76,248 and $540,867 was outstanding as of March 31, 2023, respectively. (3)Represents the weighted average of the contractual interest rates in effect as of quarter end without regard to any interest rate swaps or collars. Our total weighted average effective interest rate for the three months ended March 31, 2023, after giving effect to the impact of interest rate swaps and collars, and excluding the impact of loan premium amortization, discount accretion, and interest capitalization was 4.1%.The following table contains summary information concerning our consolidated indebtedness as of December 31, 2022:
(1)The unsecured revolver total capacity was $500,000, of which $165,978 was outstanding as of December 31, 2022. (2)The secured credit facilities include the PNC MCFA and the Newmark MCFA of which $76,248 and $558,880 was outstanding as of December 31, 2022, respectively. (3)Represents the weighted average of the contractual interest rates in effect as of quarter end without regard to any interest rate swaps or collars. Our total weighted average effective interest rate as of the year ended December 31, 2022, after giving effect to the impact of interest rate swaps and collars, and excluding the impact of loan premium amortization and discount accretion was 4.1%.
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Schedule of Maturities of Long-term Debt | The following table contains summary information concerning our consolidated indebtedness as of March 31, 2023:
|
Derivative Financial Instruments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Aggregate Amount and Estimated Net Fair Values of Our Derivative Instruments | The following table summarizes the aggregate notional amounts and estimated net fair values of our derivative instruments as of March 31, 2023 and December 31, 2022:
|
Equity Compensation Plans (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Restricted Common Share Awards and RSU of Incentive Plan | A summary of restricted common share award and RSU activity is presented below.
|
Earnings Per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliation of Basic and Diluted Earnings (Loss) Per Share | The following table presents a reconciliation of basic and diluted earnings (loss) per share for the three months ended March 31, 2023 and 2022:
|
Organization (Detail) |
Mar. 31, 2023
jointVenture
unit
property
|
---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of multifamily properties owned | property | 119 |
Number of units located with multifamily properties | unit | 35,249 |
Number of joint ventures | jointVenture | 5 |
Investments in Real Estate - Additional Information (Detail) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Feb. 28, 2023
USD ($)
|
Mar. 31, 2023
USD ($)
unit
property
|
Mar. 31, 2022
USD ($)
|
|
Real Estate Properties [Line Items] | |||
Number of multifamily properties owned | property | 119 | ||
Number of units located with multifamily properties | unit | 35,249 | ||
Disposition of real estate properties, net | $ 35,557 | $ 155,639 | |
Gain on sale of real estate assets, net | $ 985 | $ 94,712 | |
Eagle Lake Landing Apartments | |||
Real Estate Properties [Line Items] | |||
Disposition of real estate properties, net | $ 37,300 | ||
Gain on sale of real estate assets, net | $ 985 |
Investments in Real Estate - Summary of Investments in Real Estate (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Real Estate Properties [Line Items] | ||
Land | $ 579,094 | $ 579,094 |
Building | 5,697,855 | 5,695,711 |
Furniture, fixtures and equipment | 371,958 | 340,438 |
Total investments in real estate | 6,648,907 | 6,615,243 |
Accumulated depreciation | (475,001) | (425,034) |
Investments in real estate, net | $ 6,173,906 | $ 6,190,209 |
Building | ||
Real Estate Properties [Line Items] | ||
Depreciable Lives (In years) | 40 years | |
Furniture, fixtures and equipment | Minimum | ||
Real Estate Properties [Line Items] | ||
Depreciable Lives (In years) | 5 years | |
Furniture, fixtures and equipment | Maximum | ||
Real Estate Properties [Line Items] | ||
Depreciable Lives (In years) | 10 years |
Investments in Unconsolidated Real Estate - Additional Information (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Real Estate [Abstract] | ||
Aggregate land and construction in progress costs capitalized | $ 241,114 | |
Aggregate construction debt | 115,882 | |
Equity in loss from investments in unconsolidated real estate entities | $ 776 | $ 63 |
Indebtedness - Maturity of Indebtedness (Detail) $ in Thousands |
Mar. 31, 2023
USD ($)
|
---|---|
Debt Instrument [Line Items] | |
2023 | $ 8,473 |
2024 | 69,012 |
2025 | 177,156 |
2026 | 540,585 |
2027 | 27,405 |
Thereafter | 1,763,397 |
Mortgages | |
Debt Instrument [Line Items] | |
2023 | 8,473 |
2024 | 69,012 |
2025 | 173,631 |
2026 | 144,614 |
2027 | 15,943 |
Thereafter | 771,762 |
Unsecured revolver | |
Debt Instrument [Line Items] | |
2023 | 0 |
2024 | 0 |
2025 | 0 |
2026 | 185,478 |
2027 | 0 |
Thereafter | 0 |
Unsecured term loans | |
Debt Instrument [Line Items] | |
2023 | 0 |
2024 | 0 |
2025 | 0 |
2026 | 200,000 |
2027 | 0 |
Thereafter | 400,000 |
Secured credit facilities | |
Debt Instrument [Line Items] | |
2023 | 0 |
2024 | 0 |
2025 | 3,525 |
2026 | 10,493 |
2027 | 11,462 |
Thereafter | $ 591,635 |
Derivative Financial Instruments - Summary of Aggregate Amount and Estimated Net Fair Values of Derivative Instruments (Detail) - Cash Flow Hedge - USD ($) |
Mar. 31, 2023 |
Mar. 16, 2023 |
Dec. 31, 2022 |
---|---|---|---|
Derivative Instruments Gain Loss [Line Items] | |||
Notional | $ 950,000,000 | $ 750,000,000 | |
Fair Value of Assets | 32,783,000 | 41,109,000 | |
Fair Value of Liabilities | 2,283,000 | 0 | |
Interest rate swaps | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional | 500,000,000 | $ 200,000,000 | 300,000,000 |
Fair Value of Assets | 21,425,000 | 26,099,000 | |
Fair Value of Liabilities | 2,283,000 | 0 | |
Interest rate collars | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional | 250,000,000 | 250,000,000 | |
Fair Value of Assets | 6,474,000 | 8,317,000 | |
Fair Value of Liabilities | 0 | 0 | |
Forward interest rate collars | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional | 200,000,000 | 200,000,000 | |
Fair Value of Assets | 4,884,000 | 6,693,000 | |
Fair Value of Liabilities | $ 0 | $ 0 |
Derivative Financial Instruments - Additional Information (Detail) - Cash Flow Hedge - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Mar. 16, 2023 |
Dec. 31, 2022 |
|
Derivative Instruments Gain Loss [Line Items] | ||||
Notional | $ 950,000,000 | $ 750,000,000 | ||
Derivative, strike rate for the interest rate swap contract | 3.39% | |||
Interest Rate Swap and Collars | ||||
Derivative Instruments Gain Loss [Line Items] | ||||
Realized losses on interest rate hedges reclassified to earnings | 3,377,000 | $ 2,120,000 | ||
Amount expect to be reclassified out of accumulated other comprehensive income into earnings in future | $ (16,069,000) | |||
Estimated time for reclassification out of accumulated other comprehensive income into earnings | 12 months |
Stockholders' Equity and Noncontrolling Interests (Detail) - USD ($) |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 14, 2023 |
Mar. 31, 2023 |
Mar. 31, 2022 |
May 18, 2022 |
Nov. 13, 2020 |
|
Class Of Stock [Line Items] | |||||
Dividend declared per share (in dollars per share) | $ 0.14 | $ 0.12 | |||
Stock repurchase program, authorized amount | $ 250,000,000 | ||||
Amount remaining authorized for purchase under the stock repurchase program | $ 250,000,000 | ||||
At-the-market agreement to sell common shares, maximum offer price | $ 150,000,000 | ||||
Number of IROP unites exchanged (in shares) | 144,600 | ||||
IROP Units outstanding (in shares) | 5,946,571 | ||||
Common Shares | |||||
Class Of Stock [Line Items] | |||||
Conversion of noncontrolling interest to common shares (in shares) | 144,600 | 10,848 | |||
ATM Program | |||||
Class Of Stock [Line Items] | |||||
Common stock, capital shares reserved for future issuance (in shares) | 56,836,000 | ||||
Dividend Declared | |||||
Class Of Stock [Line Items] | |||||
Dividend declared per share (in dollars per share) | $ 0.14 |
Earnings Per Share - Reconciliation of Basic and Diluted Earnings (Loss) Per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share [Abstract] | ||
Net income | $ 8,872 | $ 76,880 |
Income allocated to noncontrolling interest | (224) | (2,280) |
Net income allocable to common shares | $ 8,648 | $ 74,600 |
Weighted-average shares outstanding—Basic (in shares) | 224,226,873 | 220,798,692 |
Weighted-average shares outstanding—Diluted (in shares) | 225,088,659 | 222,045,286 |
Earnings per share—Basic (in dollars per share) | $ 0.04 | $ 0.34 |
Earnings per share—Diluted (in dollars per share) | $ 0.04 | $ 0.34 |
Earnings Per Share - Additional Information (Detail) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings (loss) per share, amount | 5,946,571 | 8,994,165 |
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