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Section 1: 8-K (8-K)

0000074208false00000742082020-05-062020-05-06

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): May 6, 2020

UDR, Inc.

(Exact name of registrant as specified in its charter)

Maryland

1-10524

54-0857512

(State or other jurisdiction

(Commission

(I.R.S. Employer

of incorporation)

File Number)

Identification No.)

1745 Shea Center Drive, Suite 200,
Highlands Ranch, Colorado

80129

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (720283-6120

Not Applicable

Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01

UDR

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging Growth Company         

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   

Item 2.02 Results of Operations and Financial Condition.

On May 6, 2020, UDR, Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2020. This press release is furnished as Exhibit 99.1 to this Report and refers to supplemental financial information that is available on the Company’s website and furnished as Exhibit 99.2 to this Report. This information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 Ex. No.

    

 Description

 99.1

 Earnings press release dated May 6, 2020.

 99.2

 Supplemental Financial Information dated May 6, 2020.

104

Cover Page Interactive Data File – The cover page XBRL tags are embedded within the Inline XBRL document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

UDR, Inc.

 May 6, 2020

By:

 /s/ Joseph D. Fisher

 Joseph D. Fisher

 Senior Vice President and Chief Financial Officer

 (Principal Financial Officer)

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Section 2: EX-99.1 (EX-99.1)

udr_Ex99_1

 

 

 

 

 

Image - Image1.jpeg

 

Exhibit 99.1

 

Press Release

 

 

 

 

DENVER, CO – May 6, 2020

 

 

Contact: Trent Trujillo

 

 

 

 

Phone:   720.283.6135

 

UDR ANNOUNCES FIRST QUARTER 2020 RESULTS AND WITHDRAWS FULL-YEAR 2020 GUIDANCE

 

UDR, Inc. (the “Company”) First Quarter 2020 Highlights:

·

Net income per share was $0.01, Funds from Operations (“FFO”) per share was $0.53, FFO as Adjusted (“FFOA”) per share was $0.54, and Adjusted FFO (“AFFO”) per share was $0.51.

·

Net income attributable to common stockholders was $4.2 million as compared to $23.5 million in the prior year period. The decrease was primarily due to increased depreciation from communities acquired during 2019 and 2020, partially offset by net operating income (“NOI”) growth.

·

The Company introduced Combined Same-Store metrics, which include the impact of the 11 Joint Venture communities that were acquired in 2019 totaling 3,619 homes as if they were 100 percent owned by UDR during all periods presented.

·

Year-over-year (“YOY”) Combined Same-Store revenue, expense and NOI growth was 3.0 percent, 1.7 percent and 3.5 percent, respectively.

·

The Company continues to implement its Next Generation Operating Platform, which drove Combined Same-Store controllable operating margin expansion of approximately 60 basis points YOY to 84.7 percent, and reduced Combined Same-Store controllable expenses by 1.1 percent YOY.

·

The Company’s Combined Same-Store operating margin (property NOI divided by property rental income) was 71.2 percent as compared to 70.8 percent in the prior year period.

·

As previously announced, the Company:

o

Entered into forward sales agreements under the Company’s at-the-market equity program for approximately 2.1 million common shares at a weighted average initial forward price per share of $49.56, subject to adjustments.

o

Acquired The Slade at Channelside, a 294-home community in Tampa, FL, for $85.2 million and The Arbory, a 276-home Developer Capital Program community in suburban Portland, OR, pursuant to its option, for a cash outlay of $53.9 million.

o

Committed to providing $20.1 million to a 142-home Developer Capital Program community in Thousand Oaks, CA. As of March 31, 2020, the Company had funded $6.0 million, including its preferred return, or 30 percent, of the committed amount.

 

Subsequent to Quarter-End Highlights:

·

The Company is providing a summary of April operations, which can be found on page 3 of this Press Release. Highlights include: (1) 98.0 percent of residents paid at least a portion of monthly rent, (2) cash collections of 95.5 percent, and (3) weighted average occupancy of 96.6 percent.

·

The Company sold Waterscape, a 196-home community located in Greater Seattle, WA, for gross proceeds of $92.9 million.

·

The Company is under contract, with a  nonrefundable deposit, to sell Borgata Apartment Homes, a 71-home community located in Greater Seattle, WA, for $49.7 million.

 

As a result of uncertainties due to the ongoing Novel Coronavirus (COVID-19) pandemic, the Company has withdrawn its previously provided full-year 2020 guidance outlook. 

1

“While first quarter 2020 results met expectations, it is difficult to forecast the ultimate impact the COVID-19 pandemic will have on our business, our country, and the economy. I am proud of how the Company, our associates, and our residents have risen to the challenges put to them as we continue to work together to overcome this still evolving situation,” said Tom Toomey, UDR’s Chairman and CEO. “UDR is in a strong position to manage these challenges going forward due to our experienced team, healthy liquidity profile and balance sheet, as well as our innovative Next Generation Operating Platform, which allows us to electronically interact with, and provide service to, residents and prospects throughout our diversified portfolio.”

 

 

 

 

Q1 2020

Q1 2019

Net income per common share, diluted

$0.01

$0.08

Conversion from GAAP share count

(0.001)

(0.008)

Depreciation and amortization, including JVs

0.513

0.420

Noncontrolling interests and preferred dividends

0.004

0.010

FFO per common share and unit, diluted

$0.53

$0.51

Promoted interest on settlement of note receivable, net of tax

-

(0.021)

Legal and other costs

0.002

0.012

Unrealized (gain)/loss on unconsolidated investments, net of tax

0.000

(0.001)

Severance costs and other restructuring expense

0.005

-

Casualty-related charges/(recoveries), including JVs, net

0.004

0.001

FFOA per common share and unit, diluted

$0.54

$0.50

Recurring capital expenditures

(0.029)

(0.024)

AFFO per common share and unit, diluted

$0.51

$0.47

A reconciliation of FFO, FFOA and AFFO to GAAP Net income attributable to common stockholders can be found on Attachment 2 of the Company’s first quarter Supplemental Financial Information.

 

Operations

 

In the first quarter, total revenue increased by $50.8 million year-over-year, or 18.8 percent, to $321.5 million. This increase was primarily attributable to growth in revenue from operating and acquisition communities.

In the first quarter, the Company,

·

Introduced Combined Same-Store metrics which include the impact of the 11 Joint Venture communities totaling 3,619 homes that were acquired in 2019; and,

·

Introduced Other Markets as a category for its operating reporting structure, as management believes operating results in markets where the Company operates less than 1,000 Combined Same-Store homes are not representative of fundamentals for those markets as a whole. As such, Other Markets includes six markets that the Company operates in that do not have at least 1,000 Combined Same-Store homes.

 

First quarter Combined Same-Store NOI increased 3.5 percent year-over-year, driven by Combined Same-Store revenue growth of 3.0 percent and Combined Same-Store expense growth of 1.7 percent. Weighted average Combined Same-Store physical occupancy increased by 30 basis points to 97.0 percent versus the prior year period. The first quarter annualized rate of turnover decreased by 30 basis points to 38.2 percent versus the prior year period.

2

 

Summary of Combined Same-Store Results First Quarter 2020 versus First Quarter 2019

 

 

 

 

 

(1)

 

 

 

Region

Revenue Growth

Expense

Growth/(Decline)

NOI Growth

% of Combined Same-Store

Portfolio(1)

Occupancy(2)

Number of Homes(3)

West

3.5%
3.4%
3.5%
39.3%
97.0%
12,545

Mid-Atlantic

2.4%
0.5%
3.2%
23.8%
97.3%
10,762

Northeast

2.6%
6.0%
1.0%
14.0%
96.8%
3,892

Southeast

2.6%
1.9%
2.9%
10.8%
96.8%
7,047

Southwest

3.9%

(5.1)%

10.4%
7.3%
97.1%
5,136

Other Markets

2.3%

(0.3)%

3.3%
4.8%
96.2%
2,147

Total

3.0%
1.7%
3.5%
100.0%
97.0%
41,529

(1)Based on Q1 2020 Combined Same-Store NOI.

(2)Weighted average Combined Same-Store occupancy for the quarter.

(3)During the first quarter, 41,529 apartment homes were classified as Combined Same-Store. The Company defines QTD Combined Same-Store Communities as those communities stabilized for five full consecutive quarters, including the 11 Joint Venture communities acquired in 2019 totaling 3,619 homes as if they were 100 percent owned by UDR during all periods presented. Combined Same-Store communities were owned and had stabilized occupancy and operating expenses as of the beginning of the quarter in the prior year, were not in process of any substantial redevelopment activities, and were not held for disposition.

 

In the first quarter, sequential Combined Same-Store NOI was slightly positive, driven by Combined Same-Store revenue growth of 0.9 percent and Combined Same-Store expense growth of 3.1 percent. Weighted average Combined Same-Store physical occupancy increased by 20 basis points sequentially to 97.0 percent.

 

April Operational Trends

 

Due to economic challenges and related government actions and regulations as a result of COVID-19, the Company is providing a selection of subsequent operational trends through April 2020.

 

Summary of First Quarter and April 2020 Operational Trends versus April 2019

 

 

 

 

Multifamily Operating Metric

Q1 2020

April 2020(1)

April 2019

Cash rents received (as % of billed rent)

99.6%
95.5%
99.6%

Residents who paid at least a portion of monthly rent (% of units)

99.8%
98.0%
99.8%

  Residents who paid monthly rent in full (% of units)

99.5%
95.3%
99.5%

  Residents who paid a portion of monthly rent (% of units)

0.3%
2.7%
0.3%

  Residents who have not paid at least a portion of monthly rent (% of units)

0.2%
2.0%
0.2%

Leasing Traffic(2)

835
782
966

Applications(3)

6,816
2,148
2,531

Lease Closing Ratio(4)

28.2%
54.4%
31.0%

Annualized Turnover

38.2%
40.0%
47.2%

Weighted Average Occupancy

97.0%
96.6%
96.8%

Effective Blended Lease Rate Growth(5)

2.8%
2.0%
4.3%

(1)April 2020 collections data as of May 4, 2020. 

(2)The Company defines Leasing Traffic as average daily leads. 

(3)The Company defines Applications as the total (or gross) number of applications received. 

(4)The Company defines Lease Closing Ratio as leases signed as a percentage of visits.

(5)The Company defines Effective Blended Lease Rate Growth as the combined proportional growth as a result of Effective New Lease Rate Growth (the increase in gross potential rent realized less concessions for the new lease term, or current effective rent, versus prior resident effective rent for the prior lease term on new leases commenced during the current quarter) and Effective Renewal Lease Rate Growth (the increase in gross potential rent realized less concessions for the new lease term, or current effective rent, versus prior effective rent for the prior lease term on renewed leases commenced during the current quarter).

 

3

“I am pleased to report that 98 percent of our residents paid all or part of April rent, and that operating trends, including traffic patterns and applications submitted, have improved meaningfully over the past several weeks,” said Jerry Davis, UDR’s President and Chief Operating Officer. “We continue to work with each of our residents that were negatively impacted by COVID-19, which has helped to reduce turnover, improve our retention rates and maintain strong occupancy of 96.6 percent.”

 

Retail tenant income accounts for less than 2 percent of the Company’s consolidated NOI. In April, the Company collected 63 percent of total billed retail rent. The Company has arranged, or is in discussions on arranging, rent accommodations with tenants that amount to an additional 34 percent of monthly billed retail rent. Delinquencies amount to 3 percent of total retail rent due in April.

 

Wholly Owned Transactional Activity

 

As previously announced, during the quarter the Company:

 

·

Acquired The Slade at Channelside, a 294-home community in Tampa, FL, for $85.2 million or $290,000 per home. At the time of the acquisition, the 11 year-old community had average monthly revenue per occupied home of $1,898 and occupancy of 92 percent.

 

Subsequent to quarter-end, the Company:

 

·

Sold Waterscape, a 196-home community located in Greater Seattle, WA, for gross proceeds of $92.9 million, or $474,000 per home. At the time of sale, the 6 year-old community had an average monthly revenue per occupied home of $2,476 and occupancy of 97 percent.

·

Is under contract, with a  nonrefundable deposit, to sell Borgata Apartment Homes, a 71-home community located in Greater Seattle, WA, for $49.7 million, or $700,000 per home. During the quarter, the 19 year-old community had a weighted average monthly revenue per occupied home of $3,301 and occupancy of 97 percent.

 

Development Activity

At the end of the first quarter, the Company’s development pipeline totaled $278.5 million and was 34 percent funded. The Company’s active pipeline includes 3 development communities, 1 each in Addison, TX, Denver, CO, and Dublin, CA, for a combined total of 878 homes. The development pipeline is currently expected to produce a weighted average spread between stabilized yields and current market cap rates of 150 to 200 basis points.

 

Developer Capital Program (“DCP”) Activity

 

At the end of the first quarter, the Company’s DCP investments, including accrued return, totaled $409.1 million. As previously announced, during the quarter the Company:

·

Committed to providing $20.1 million of capital to a 142-home multifamily development located in Thousand Oaks, CA. The investment yields 9.0 percent on the Company’s capital outstanding with a profit participation upon sale of the community. As of March 31, 2020, the Company had funded $6.0 million, including its preferred return, or 30 percent, of the committed amount.

·

Closed on the acquisition of The Arbory pursuant to its option, acquiring the approximately 51 percent interest it did not own from its West Coast Development Joint Venture. The Arbory is a 276-home community completed in 2018 in suburban Portland, OR. The cash outlay for the acquisition totaled $53.9 million, including the payoff of debt, and the Company’s blended all-in investment in the community was $72.3 million. At the time of acquisition, average monthly revenue per occupied home was $1,545 and occupancy was 94 percent.

 

4

Capital Markets and Balance Sheet Activity

 

As previously announced, during the first quarter the Company:

 

·

Entered into forward sales agreements under the Company’s at-the-market equity program for approximately 2.1 million common shares at a weighted average initial forward price per share of $49.56, which will be adjusted at settlement to reflect the then-current federal funds rate and the amount of dividends paid to holders of UDR common stock over the term of the forward sales agreements. No shares under the forward sales agreements have been settled. The final dates by which shares sold under the forward sales agreements must be settled range between February 12, 2021, and March 3, 2021.

·

Issued $200.0 million of unsecured debt at an effective interest rate of 2.53 percent with 9.9 years to maturity.

 

At April 30, 2020, the Company had $399.8 million outstanding under its revolving credit facility, leaving approximately $775.2 million of liquidity through a combination of cash and undrawn capacity on its credit facilities. For the remainder of 2020, the Company has only $204.0 to $269.0 million in identified potential forward capital uses, excluding scheduled debt maturities and principal amortization of $119.0 million. This is set against $195.0 million of capital sources from the completed sale of Waterscape and the potential settlement of previously announced forward equity sales agreements. The Company expects to fund any remaining capital uses with a combination of previously announced dispositions that are currently under contract, potential new debt issuances, and future AFFO in excess of dividend distributions. Please see Attachment 15 of the Company’s first quarter Supplemental Financial Information for additional details.

The Company’s total indebtedness as of March 31, 2020 was $4.9 billion, with maturities through 2022 totaling approximately $106.0 million (or approximately 2 percent of total consolidated debt outstanding), excluding principal amortization and amounts on the Company’s working capital credit facility. The Company ended the quarter with fixed‑rate debt representing 92.8 percent of its total debt, a total blended interest rate of 3.28 percent and a weighted average years to maturity of 7.1 years. The Company’s consolidated leverage was 35.0 percent versus 34.2 percent a year ago, its consolidated net‑debt-to-EBITDAre was 6.0x versus 6.1x a year ago and its consolidated fixed charge coverage ratio was 4.8x versus 4.9x a year ago.

Senior Management

 

Effective April 1, 2020, Warren L. Troupe transitioned from the role of Senior Executive Vice President to Senior Advisor to the Office of the Chairman. In conjunction with the transition, Mr. Troupe has agreed to a consulting agreement with the Company running through December 2022 and renews annually thereafter unless terminated by either party. In this role, Mr. Troupe will continue to assist with the Company’s transactional, risk management, legal and capital markets activities, as well as provide expertise pertaining to special projects for the Chairman.

 

Dividend

 

As previously announced, the Company’s Board of Directors declared a regular quarterly dividend on its common stock for the first quarter of 2020 in the amount of $0.3600 per share. The dividend was paid in cash on April 30, 2020 to UDR common stock shareholders of record as of April 10, 2020. The first quarter 2020 dividend represented the 190th consecutive quarterly dividend paid by the Company on its common stock.

 

Supplemental Information

 

The Company offers Supplemental Financial Information that provides details on the financial position and operating results of the Company which is available on the Company's website at ir.udr.com.

 

5

Conference Call and Webcast Information

 

UDR will host a webcast and conference call at 3:00 p.m. Eastern Time on May 7, 2020 to discuss first quarter results as well as high-level views for 2020.

 

The webcast will be available on UDR's website at ir.udr.com. To listen to a live broadcast, access the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software.

 

To participate in the teleconference dial 877-705-6003 for domestic and 201-493-6725 for international. A passcode is not necessary.

 

This quarter, given the combination of a high volume of conference calls occurring during this time of year generally and the impact that the COVID-19 pandemic has had on staffing and capacity at our conference call provider, we anticipate potential delays if you dial in to be connected to the live call. As a result, we encourage stockholders and interested parties to join us for the Company’s earnings results discussion via the webcast link. If you choose to dial in to the live call, please allow extra time to be connected to the call.

 

A replay of the conference call will be available through June 7, 2020, by dialing 844-512-2921 for domestic and 412-317-6671 for international and entering the confirmation number, 13701957, when prompted for the passcode.

 

A replay of the call will also be available for 30 days on UDR's website at ir.udr.com.

Full Text of the Earnings Report and Supplemental Data

 

The full text of the earnings report and Supplemental Financial Information will be available on the Company’s website at ir.udr.com.  

 

Forward-Looking Statements

 

Certain statements made in this press release may constitute “forward-looking statements.” Words such as “expects,” “intends,” “believes,” “anticipates,” “plans,” “likely,” “will,” “seeks,” “estimates” and variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements, by their nature, involve estimates, projections, goals, forecasts and assumptions and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in a forward-looking statement, due to a number of factors, which include, but are not limited to, the impact of the COVID-19 pandemic and measures intended to prevent its spread or address its effects, unfavorable changes in the apartment market, changing economic conditions, the impact of inflation/deflation on rental rates and property operating expenses, expectations concerning availability of capital and the stabilization of the capital markets, the impact of competition and competitive pricing, acquisitions, developments and redevelopments not achieving anticipated results, delays in completing developments, redevelopments and lease-ups on schedule, expectations on job growth, home affordability and demand/supply ratio for multifamily housing, expectations concerning development and redevelopment activities, expectations on occupancy levels and rental rates, expectations concerning the joint ventures with third parties, expectations that technology will help grow net operating income, expectations on annualized net operating income and other risk factors discussed in documents filed by the Company with the SEC from time to time, including the Company's Annual Report on Form 10-K and the Company's Quarterly Reports on Form 10-Q. Actual results may differ materially from those described in the forward-looking statements. These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this press release, and the Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in the Company's expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required under the U.S. securities laws.

 

6

About UDR, Inc. 

UDR, Inc. (NYSE: UDR), an S&P 500 company, is a leading multifamily real estate investment trust with a demonstrated performance history of delivering superior and dependable returns by successfully managing, buying, selling, developing and redeveloping attractive real estate communities in targeted U.S. markets. As of March 31, 2020, UDR owned or had an ownership position in 51,587 apartment homes including 878 homes under development. For over 47 years, UDR has delivered long-term value to shareholders, the best standard of service to Residents and the highest quality experience for Associates.

7

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Section 3: EX-99.2 (EX-99.2)

udr_Ex99_2

Exhibit 99.2

Financial Highlights

 

UDR, Inc.

As of End of First Quarter 2020

(Unaudited) (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Actual Results

 

 

 

 

Dollars in thousands, except per share and unit

 

 

 

1Q 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Metrics

 

 

 

 

 

 

 

 

 

 

Net income/(loss) attributable to UDR, Inc.

 

 

 

$5,221

 

 

 

 

 

 

Net income/(loss) attributable to common stockholders

 

 

 

$4,155

 

 

 

 

 

 

Income/(loss) per weighted average common share, diluted

 

 

 

$0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Metrics

 

 

 

 

 

 

 

 

 

 

FFO per common share and unit, diluted

 

 

 

$0.53

 

 

 

 

 

 

FFO as Adjusted per common share and unit, diluted

 

 

 

$0.54

 

 

 

 

 

 

Adjusted Funds from Operations ("AFFO") per common share and unit, diluted

 

 

 

$0.51

 

 

 

 

 

 

Dividend declared per share and unit

 

 

 

$0.36

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Combined Same-Store Operating Metrics (4)

 

 

 

 

 

 

 

 

 

 

Combined Revenue growth

 

 

 

3.0%

 

 

 

 

 

 

Combined Expense growth

 

 

 

1.7%

 

 

 

 

 

 

Combined NOI growth

 

 

 

3.5%

 

 

 

 

 

 

Combined Physical Occupancy

 

 

 

97.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Property Metrics

 

 

 

Homes

 

Communities

 

% of Total NOI

 

 

Combined Same-Store (4)

 

 

 

41,529

 

132

 

80.9%

 

 

Acquired JV Same-Store Portfolio (4)

 

 

 

(3,619)

 

(11)

 

-6.9%

 

 

UDR Same-Store

 

 

 

37,910

 

121

 

74.0%

 

 

Stabilized, Non-Mature

 

 

 

4,561

 

12

 

10.1%

 

 

Acquired JV Same-Store Portfolio (4)

 

 

 

3,619

 

11

 

6.9%

 

 

Acquired Communities

 

 

 

570

 

2

 

0.6%

 

 

Redevelopment

 

 

 

652

 

2

 

2.1%

 

 

Development, completed

 

 

 

-

 

-

 

-

 

 

Non-Residential / Other

 

 

 

N/A

 

N/A

 

1.2%

 

 

Joint Venture (includes completed Joint Venture developments) (2)

 

 

 

3,130

 

14

 

5.1%

 

 

Total completed homes

 

 

 

50,442

 

162

 

100.0%

 

 

Sold and Held for Disposition

 

 

 

267

 

2

 

-

 

 

Under Development

 

 

 

878

 

3

 

-

 

 

Total Quarter-end homes (2)(3)

 

 

 

51,587

 

167

 

100%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance Sheet Metrics (adjusted for non-recurring items)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1Q 2020

 

1Q 2019

 

 

 

 

Consolidated Interest Coverage Ratio

 

 

 

5.0x

 

5.0x

 

 

 

 

Consolidated Fixed Charge Coverage Ratio

 

 

 

4.8x

 

4.9x

 

 

 

 

Consolidated Debt as a percentage of Total Assets

 

 

 

35.0%

 

34.2%

 

 

 

 

Consolidated Net Debt-to-EBITDAre

 

 

 

6.0x

 

6.1x

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Picture 3


(1)

See Attachment 16 for definitions and other terms.

(2)

Joint venture NOI is based on UDR's share.  Homes and communities at 100%.

(3)

Excludes 2,483 homes that are part of the Developer Capital Program  as described in Attachment 12(B).

(4)

Amounts include the Acquired JV Same-Store Portfolio Communities as if these communities were 100% owned by UDR during all periods presented. These communities were stabilized as of the beginning of the quarter in the prior year, were not in process of any substantial redevelopment activities, and were not held for disposition. Because these communities became wholly owned by UDR in 2019 (the 11 communities and 3,619 homes were previously owned by UDR unconsolidated JVs), they are not included in the UDR Same-Store Communities. These 11 communities will be eligible to join the UDR Same-Store Communities on January 1, 2021.

 

1

Picture 9

Attachment 1

 

UDR, Inc.

Consolidated Statements of Operations

(Unaudited) (1)

 

 

 

 

 

 

 

 

Three Months Ended

 

 

March 31,

In thousands, except per share amounts

 

2020

 

2019

 

 

 

 

 

REVENUES:

 

 

 

 

Rental income

 

$
320,093

 

$
267,922

Joint venture management and other fees

 

1,388

 

2,751

Total revenues

 

321,481

 

270,673

 

 

 

 

 

OPERATING EXPENSES:

 

 

 

 

Property operating and maintenance

 

49,483

 

41,939

Real estate taxes and insurance

 

45,145

 

36,300

Property management

 

9,203

 

7,703

Other operating expenses

 

4,966

 

5,646

Real estate depreciation and amortization

 

155,476

 

112,468

General and administrative

 

14,978

 

12,467

Casualty-related charges/(recoveries), net

 

1,251

 

 -

Other depreciation and amortization

 

2,025

 

1,656

Total operating expenses

 

282,527

 

218,179

 

 

 

 

 

Operating income

 

38,954

 

52,494

 

 

 

 

 

Income/(loss) from unconsolidated entities

 

3,367

 

49

Interest expense

 

(39,317)

 

(33,542)

Interest income and other income/(expense), net

 

2,700

 

9,813

 

 

 

 

 

Income/(loss) before income taxes

 

5,704

 

28,814

Tax (provision)/benefit, net

 

(164)

 

(2,212)

 

 

 

 

 

Net Income/(loss)

 

5,540

 

26,602

Net (income)/loss attributable to redeemable noncontrolling interests in the OP and DownREIT Partnership

 

(313)

 

(2,057)

Net (income)/loss attributable to noncontrolling interests

 

(6)

 

(42)

 

 

 

 

 

Net income/(loss) attributable to UDR, Inc.

 

5,221

 

24,503

Distributions to preferred stockholders - Series E (Convertible)

 

(1,066)

 

(1,011)

 

 

 

 

 

Net income/(loss) attributable to common stockholders

 

$
4,155

 

$
23,492

 

 

 

 

 

 

 

 

 

 

Income/(loss) per weighted average common share - basic:

 

$ 0.01

 

$ 0.08

Income/(loss) per weighted average common share - diluted:

 

$ 0.01

 

$ 0.08

 

 

 

 

 

Common distributions declared per share

 

$0.3600

 

$0.3425

 

 

 

 

 

Weighted average number of common shares outstanding - basic

 

294,457

 

277,002

Weighted average number of common shares outstanding - diluted

 

295,160

 

277,557

(1)

See Attachment 16 for definitions and other terms.

 

 

2

Picture 9

Attachment 2

 

UDR, Inc.

Funds From Operations

(Unaudited) (1)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

 

March 31,

In thousands, except per share and unit amounts

 

 

2020

 

2019

 

 

 

 

 

 

 

Net income/(loss) attributable to common stockholders

 

$

4,155

 

$

23,492

 

 

 

 

 

 

 

Real estate depreciation and amortization

 

 

155,476

 

 

112,468

Noncontrolling interests

 

 

319

 

 

2,099

Real estate depreciation and amortization on unconsolidated joint ventures

 

 

8,816

 

 

15,674

Funds from operations ("FFO") attributable to common stockholders and unitholders, basic

 

$

168,766

 

$

153,733

 

 

 

 

 

 

 

  Distributions to preferred stockholders - Series E (Convertible) (2)

 

 

1,066

 

 

1,011

 

 

 

 

 

 

 

FFO attributable to common stockholders and unitholders, diluted

 

$

169,832

 

$

154,744

 

 

 

 

 

 

 

FFO per weighted average common share and unit, basic 

 

$

0.53

 

$

0.51

FFO per weighted average common share and unit, diluted

 

$

0.53

 

$

0.51

 

 

 

 

 

 

 

Weighted average number of common shares and OP/DownREIT Units outstanding - basic

 

 

316,685

 

 

301,282

Weighted average number of common shares, OP/DownREIT Units, and common stock

 

 

 

 

 

 

   equivalents outstanding - diluted

 

 

320,399

 

 

304,848

 

 

 

 

 

 

 

Impact of adjustments to FFO:

 

 

 

 

 

 

  Promoted interest on settlement of note receivable, net of tax

 

$

 -

 

$

(6,482)

  Legal and other costs

 

 

758

 

 

3,660

  Unrealized (gain)/loss on unconsolidated investments, net of tax

 

 

32

 

 

(229)

  Severance costs and other restructuring expense

 

 

1,642

 

 

 -

  Casualty-related charges/(recoveries), net

 

 

1,399

 

 

15

  Casualty-related charges/(recoveries) on unconsolidated joint ventures, net

 

 

31

 

 

146

 

 

$

3,862

 

$

(2,890)

 

 

 

 

 

 

 

FFO as Adjusted attributable to common stockholders and unitholders, diluted

 

$

173,694

 

$

151,854

 

 

 

 

 

 

 

FFO as Adjusted per weighted average common share and unit, diluted

 

$

0.54

 

$

0.50

 

 

 

 

 

 

 

Recurring capital expenditures

 

 

(9,209)

 

 

(7,218)

AFFO attributable to common stockholders and unitholders, diluted

 

$

164,485

 

$

144,636

 

 

 

 

 

 

 

AFFO per weighted average common share and unit, diluted

 

$

0.51

 

$

0.47


(1)

See Attachment 16 for definitions and other terms.

(2)

Series E preferred shares are dilutive for purposes of calculating FFO per share for the three months ended March 31, 2020 and March 31, 2019.  Consequently, distributions to Series E preferred stockholders are added to FFO and the weighted average number of shares are included in the denominator when calculating FFO per common share and unit, diluted.

3

Picture 9

 

Attachment 3

 

UDR, Inc.

Consolidated Balance Sheets

(Unaudited) (1)

 

 

 

 

 

 

 

 

March 31,

 

December 31,

In thousands, except share and per share amounts

 

2020

 

2019

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

Real estate owned:

 

 

 

 

Real estate held for investment

 

$
12,608,022

 

$
12,532,324

Less: accumulated depreciation

 

(4,231,269)

 

(4,131,330)

Real estate held for investment, net

 

8,376,753

 

8,400,994

Real estate under development

 

 

 

 

(net of accumulated depreciation of $81 and $23)

 

95,245

 

69,754

Real estate held for disposition

 

 

 

 

(net of accumulated depreciation of $41,121 and $0)

 

73,529

 

 -

Total real estate owned, net of accumulated depreciation

 

8,545,527

 

8,470,748

 

 

 

 

 

Cash and cash equivalents

 

980

 

8,106

Restricted cash

 

21,949

 

25,185

Notes receivable, net

 

151,543

 

153,650

Investment in and advances to unconsolidated joint ventures, net

 

588,395

 

588,262

Operating lease right-of-use assets

 

203,410

 

204,225

Other assets

 

179,301

 

186,296

Total assets

 

$
9,691,105

 

$
9,636,472

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

Secured debt

 

$
1,144,201

 

$
1,149,441

Unsecured debt

 

3,740,937

 

3,558,083

Operating lease liabilities

 

197,829

 

198,558

Real estate taxes payable

 

33,134

 

29,445

Accrued interest payable

 

31,494

 

45,199

Security deposits and prepaid rent

 

48,474

 

48,353

Distributions payable

 

115,259

 

109,382

Accounts payable, accrued expenses, and other liabilities

 

82,254

 

90,032

Total liabilities

 

5,393,582

 

5,228,493

 

 

 

 

 

Redeemable noncontrolling interests in the OP and DownREIT Partnership

 

819,133

 

1,018,665

 

 

 

 

 

Equity:

 

 

 

 

Preferred stock, no par value; 50,000,000 shares authorized

 

 

 

 

2,780,994 shares of 8.00% Series E Cumulative Convertible issued

 

 

 

 

and outstanding (2,780,994 shares at December 31, 2019)

 

46,200

 

46,200

14,543,281 shares of Series F outstanding (14,691,274 shares

 

 

 

 

at December 31, 2019)

 

 1

 

 1

Common stock, $0.01 par value; 350,000,000 shares authorized

 

 

 

 

294,881,038 shares issued and outstanding (294,588,305 shares at December 31, 2019)

 

2,949

 

2,946

Additional paid-in capital

 

5,788,471

 

5,781,975

Distributions in excess of net income

 

(2,360,636)

 

(2,462,132)

Accumulated other comprehensive income/(loss), net

 

(12,870)

 

(10,448)

Total stockholders' equity

 

3,464,115

 

3,358,542

Noncontrolling interests

 

14,275

 

30,772

Total equity

 

3,478,390

 

3,389,314

Total liabilities and equity

 

$
9,691,105

 

$
9,636,472

(1)

See Attachment 16 for definitions and other terms.

 

4

Picture 9

 

Attachment 4(A)

 

UDR, Inc.

Selected Financial Information

(Unaudited) (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31,

 

December 31,

Common Stock and Equivalents

 

 

 

 

 

 

 

 

 

2020

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

Common shares

 

 

 

 

 

 

 

 

 

294,620,735

 

294,340,740

Restricted shares

 

 

 

 

 

 

 

 

 

260,303

 

247,565

Total common shares

 

 

 

 

 

 

 

 

 

294,881,038

 

294,588,305

Restricted unit and common stock equivalents

 

 

 

 

 

 

 

 

 

59,632

 

766,926

Operating and DownREIT Partnership units

 

 

 

 

 

 

 

 

 

20,665,674

 

20,061,283

Class A Limited Partnership units

 

 

 

 

 

 

 

 

 

1,751,671

 

1,751,671

Series E cumulative convertible preferred shares (2)

 

 

 

3,010,843

 

3,010,843

Total common shares, OP/DownREIT units, and common stock equivalents

 

 

 

320,368,858

 

320,179,028

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Number of Shares Outstanding

 

 

 

 

 

 

 

 

 

1Q 2020

 

1Q 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares and OP/DownREIT units outstanding - basic

 

 

 

316,685,092

 

301,282,354

Weighted average number of OP/DownREIT units outstanding

 

 

 

(22,227,883)

 

(24,280,619)

Weighted average number of common shares outstanding - basic per the Consolidated Statements of Operations

 

 

 

294,457,209

 

277,001,735

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares, OP/DownREIT units, and common stock equivalents outstanding - diluted

 

 

 

320,398,509

 

304,848,093

Weighted average number of OP/DownREIT units outstanding

 

 

 

(22,227,883)

 

(24,280,619)

Weighted average number of Series E cumulative convertible preferred shares outstanding (3)

 

 

 

(3,010,843)

 

(3,010,843)

Weighted average number of common shares outstanding - diluted per the Consolidated Statements of Operations

 

 

 

295,159,783

 

277,556,631

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


(1)

See Attachment 16 for definitions and other terms.

(2)

At March 31, 2020 and December 31, 2019 there were 2,780,994 of Series E cumulative convertible preferred shares outstanding, which is equivalent to 3,010,843 shares of common stock if converted (after adjusting for the special dividend paid in 2008).

(3)

Series E cumulative convertible preferred shares are anti-dilutive for purposes of calculating Income/(loss) per weighted average common share for the three months ended March 31, 2020 and March 31, 2019.

 

5

Picture 9

Attachment 4(B)

 

UDR, Inc.

Selected Financial Information

(Unaudited) (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Average

 

Average Years

Debt Structure, In thousands

 

 

 

 

 

 

Balance

 

% of Total

 

Interest Rate

 

to Maturity (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Secured

 

Fixed

 

 

 

 

$
1,086,678

 

22.3%

 

3.85%

 

5.3

 

 

Floating

 

 

 

 

27,000

 

0.6%

 

1.91%

 

12.0

 

 

Combined

 

 

 

 

1,113,678

 

22.9%

 

3.80%

 

5.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured

 

Fixed

 

 

 

 

3,430,644

(3)

70.5%

 

3.44%

 

8.2

 

 

Floating

 

 

 

 

324,797

 

6.6%

 

1.72%

 

0.9

 

 

Combined

 

 

 

 

3,755,441

 

77.1%

 

3.29%

 

7.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Debt

 

Fixed

 

 

 

 

4,517,322

 

92.8%

 

3.54%

 

7.5

 

 

Floating

 

 

 

 

351,797

 

7.2%

 

1.74%

 

1.7

 

 

Combined

 

 

 

 

4,869,119

 

100.0%

 

3.41%

 

7.1

 

 

Total Non-Cash Adjustments (4)

 

 

 

 

16,019

 

 

 

 

 

 

 

 

Total per Balance Sheet

 

 

 

 

$
4,885,138

 

 

 

3.28%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt Maturities, In thousands

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revolving Credit

 

 

 

 

 

 

 

 

 

 

Unsecured

 

Facilities & Comm.

 

 

 

 

 

Weighted Average

 

 

Secured Debt (5)

 

Debt (5)

 

Paper (2) (6) (7)

 

Balance

 

% of Total

 

Interest Rate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$
112,592

 

$

 -

 

$
215,000

 

$
327,592

 

6.7%

 

2.51%

2021

 

                                           8,763

 

 

 -

 

24,797

 

        33,560

 

0.7%

 

2.50%

2022

 

                                           9,159

 

 

 -

 

 -

 

          9,159

 

0.2%

 

4.42%

2023

 

                                       295,965

 

 

350,000

 

 -

 

      645,965

 

13.3%

 

3.44%

2024

 

95,280

 

 

315,644

 

50,000

 

460,924

 

9.5%

 

3.55%

2025

 

173,189

 

 

300,000

 

 -

 

473,189

 

9.7%

 

4.22%

2026

 

51,070

 

 

300,000

 

 -

 

351,070

 

7.2%

 

3.00%

2027

 

1,111

 

 

300,000

 

 -

 

301,111

 

6.2%

 

3.50%

2028

 

122,465

 

 

300,000

 

 -

 

422,465

 

8.7%

 

3.67%

2029

 

144,584

 

 

300,000

 

 -

 

444,584

 

9.1%

 

3.89%

Thereafter

 

99,500

 

 

1,300,000

 

 -

 

1,399,500

 

28.7%

 

3.15%

 

 

1,113,678

 

 

3,465,644

 

289,797

 

4,869,119

 

100.0%

 

3.41%

Total Non-Cash Adjustments (4)

 

30,523

 

 

(14,504)

 

 -

 

16,019

 

 

 

 

Total per Balance Sheet

 

$
1,144,201

 

$

3,451,140

 

$
289,797

 

$
4,885,138

 

 

 

3.28%

(1)

See Attachment 16 for definitions and other terms.

(2)

The 2020 maturity reflects the $215.0 million of principal outstanding at an interest rate of 1.58%, an equivalent of LIBOR plus a spread of 47 basis points, on the Company’s unsecured commercial paper program as of March 31, 2020.  Under the terms of the program the Company may issue up to a maximum aggregate amount outstanding of $500.0 million.  If the commercial paper was refinanced using the line of credit, the weighted average years to maturity would be 7.2 years without extensions and 7.3 years with extensions.  In April of 2020, the $215.0 million of unsecured commercial paper was paid off with draws on our line of credit and working capital credit facility.

(3)

Includes $315.0 million of floating rate debt that has been fixed using interest rate swaps at a weighted average all-in rate of 2.55% until January 2021.

(4)

Includes the unamortized balance of fair market value adjustments, premiums/discounts and deferred financing costs.

(5)

Includes principal amortization, as applicable.

(6)

There was $50.0 million outstanding on our $1.1 billion line of credit at March 31, 2020.  The facility has a maturity date of January 2023, plus two six-month extension options and carries an interest rate equal to LIBOR plus a spread of 82.5 basis points.  The $50.0 million outstanding on our line of credit is reflected in the above table as if the two six-month extension options were exercised.

(7)

There was $24.8 million outstanding on our $75.0 million working capital credit facility at March 31, 2020.  The facility has a maturity date of January 2021.  The working capital credit facility carries an interest rate equal to LIBOR plus a spread of 82.5 basis points.

6

Picture 9

Attachment 4(C)

 

UDR, Inc.

Selected Financial Information

(Dollars in Thousands)

(Unaudited) (1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

Coverage Ratios

 

 

 

 

 

 

 

 

 

March 31, 2020

Net income/(loss)

 

 

 

 

 

 

 

 

 

$
5,540

Adjustments:

 

 

 

 

 

 

 

 

 

 

Interest expense, including costs associated with debt extinguishment

 

 

 

 

 

 

 

 

 

39,317

Real estate depreciation and amortization