Market Overview

UDR Announces First Quarter 2019 Results

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UDR, Inc. (the "Company") First Quarter 2019 Highlights:

  • Net income per share was $0.08, Funds from Operations ("FFO") per
    share was $0.51, FFO as Adjusted ("FFOA") per share was $0.50, and
    Adjusted Funds from Operations ("AFFO") per share was $0.47.
  • Net income attributable to common stockholders was $23.5 million as
    compared to $80.8 million in the prior year period. The decrease was
    primarily due to lower gains on the sale of real estate.
  • Year-over-year same-store ("SS") revenue, expense and net operating
    income ("NOI") growth was 3.8 percent, 3.0 percent and 4.1 percent,
    respectively.
  • Acquired four apartment communities comprising 1,110 homes and two
    development sites for a total cash outlay, including debt payoffs, of
    $402.9 million.
  • Commenced a $25.0 million redevelopment of 10 Hanover Square, a
    493-home community located in lower Manhattan, and a $10.5 million
    redevelopment of Garrison Square, a 160-home community located in the
    Back Bay neighborhood of Boston.
  • The UDR/MetLife Joint Venture commenced construction of Vitruvian West
    Phase 2, a $64.0 million (at 100 percent), 366-home community located
    in Addison, TX.
  • Issued approximately 4.35 million common shares through the Company's
    at-the-market equity program at a weighted average net price of $44.16
    for proceeds of $192.2 million.

Subsequent to Quarter-End Highlights:

  • Acquired Rodgers Forge, a 498-home community located in Towson, MD,
    for $86.4 million.
  • Entered into a contract to acquire Park Square, a 313-home community
    located in King of Prussia, PA, for $108.5 million.
  • Invested in a Developer Capital Program ("DCP") project located in
    Oakland, CA with a total capital commitment of $27.3 million.
                     
          Q1 2019         Q1 2018
Net income per common share, diluted         $0.08         $0.30
Conversion from GAAP share count         (0.008)         (0.028)
Net gain on the sale of depreciable real estate owned, including JVs - (0.237)
Cumulative effect of change in accounting principle - (0.007)
Depreciation and amortization, including JVs 0.420 0.413
Noncontrolling interests and preferred dividends         0.010         0.028
FFO per common share and unit, diluted         $0.51         $0.47
Promoted interest on settlement of note receivable, net of tax (0.021) -
Legal and other costs 0.011 -
Casualty-related charges/(recoveries), including JVs, net         0.001         0.003
FFOA per common share and unit, diluted         $0.50         $0.47
Recurring capital expenditures         (0.024)         (0.022)
AFFO per common share and unit, diluted         $0.47         $0.45

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 $17.4 million
year-over-year, or 6.9 percent, to $270.7 million. This increase was
primarily attributable to growth in revenue from operating, lease-up and
acquisition communities.

In the first quarter, same-store NOI increased 4.1 percent
year-over-year, driven by same-store revenue growth of 3.8 percent and
same-store expense growth of 3.0 percent. Weighted average same-store
physical occupancy decreased by 10 basis points year-over-year to 96.8
percent. The first quarter annualized rate of turnover was 39.2 percent,
representing a 110 basis point decrease year-over-year.

Summary of Same-Store Results First Quarter 2019 versus First
Quarter 2018

 
Region    

Revenue
Growth

   

Expense
Growth/
(Decline)

   

NOI
Growth

   

% of
Same-Store
NOI(1)

   

Same-Store
Occupancy(2)

   

Number of
Same-Store
Homes(3)

                       
West 4.3 % 3.5 % 4.6 % 46.2 % 96.4 % 13,942
Mid-Atlantic 3.4 %
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