Core Viewpoint - Centerspace has completed the sale of five communities in St. Cloud, MN, for $124.0 million, marking its exit from that market while continuing with planned dispositions in Minneapolis [1][2]. Group 1: Transaction Details - The sale involved 832 homes and is part of a broader portfolio repositioning strategy initiated in June 2025 [2]. - Proceeds from the sale will be utilized to reduce leverage and for general corporate purposes [2]. Group 2: Management Commentary - CEO Anne Olson highlighted that the transaction enhances the quality and diversification of Centerspace's portfolio, alongside recent acquisitions in Salt Lake City and Fort Collins [2]. - Future capital allocation will be carefully considered, with options including accelerated deleveraging, value-add investments, share buybacks, and dividends to shareholders [2]. Group 3: Company Overview - Centerspace operates 68 apartment communities with a total of 12,941 homes across several states, including Colorado, Minnesota, and Utah [2]. - The company has been recognized as a top workplace for six consecutive years by the Minneapolis Star Tribune [2].

Core Viewpoint - Copper Standard Resources Inc. is focusing on its existing projects in Peru while making management changes and evaluating new opportunities [2][6][9] Project Updates - The company has decided not to proceed with acquiring the Francisco José IV and V claims but retains a 100% interest in the El Ferrol property [2] - The Pacaska Project features a high-quality epithermal gold-silver target at surface and a copper-gold porphyry target at depth, with rock sampling showing gold mineralization ranging from 0.2 to 1.0 g/t Au and local values up to 17 g/t gold and 11% copper [3] - The Capricho Project contains a porphyry copper-molybdenum system with reported copper values up to 3% and is under option by Solaris Resources Inc. for a 75% interest [4] - The Paco Orco Project includes mineralized gossans with surface rock samples showing values up to 0.58% lead, 0.26% zinc, and 58 g/t silver, also under option by Solaris for a 75% interest [5] Management Changes - Steven Krause has been appointed as Chief Financial Officer effective September 30, 2025, bringing extensive experience in mining and mineral exploration [6] - Christian Uria will step down as CFO to pursue other opportunities, and the company expresses gratitude for his contributions [7] - Christian Milau will step down as a Director but will continue as a key advisor after being appointed President of Eldorado Gold Corporation [8]

Core Viewpoint - The recent non-binding takeout offer for Plymouth Industrial signifies a growing trend in M&A activity within the real estate sector, driven by favorable market conditions and significant valuation disparities among REITs [1][6]. Group 1: M&A Activity Drivers - The median REIT is currently trading at 81.8% of NAV, with some REITs as low as 46% and others at 198%, creating opportunities for accretive M&A transactions [1][6]. - Strong fundamentals in REITs are evident, with 60.7% of REITs beating earnings in Q2 2025, indicating robust performance in the sector [5][6]. - There is ample capital available for acquisitions, with private equity firms and publicly traded REITs well-capitalized following the reopening of equity and debt markets post-pandemic [6][7]. Group 2: Sector-Specific Transaction Volume - Industrial REITs have been particularly active, acquiring 90 properties in 2025 for a total of $3.94 billion [8]. - In the shopping center sector, Blackstone's buyout of ROIC and 86 individual property purchases by shopping center REITs totaling $2.39 billion highlight increased M&A interest [9]. - The multifamily sector has seen significant activity, with Equity Residential acquiring a portfolio from Blackstone for $964 million and BSR REIT selling to Avalon Bay for $618 million, alongside $2.7 billion in individual asset purchases [10]. Group 3: Targeted REITs for Acquisition - Whitestone REIT is a potential target due to its trading at $12.91, significantly below its NAV of $17.88, despite strong asset performance [12][17]. - Centerspace is trading at 73.9% of NAV, with a unique portfolio that is outperforming in its markets, making it an attractive acquisition target [18][19]. - Kite Realty is noted for its large discount to NAV and strong cash flows, presenting an opportunity for accretive acquisitions [21][23]. - Farmland Partners is strategically selling assets to buy back stock, potentially leading to a full company sale in the future [24][25]. - Armada Hoffler is trading at a substantial discount to NAV, with a market price of $7.15 compared to an NAV of $12.49, indicating a significant acquisition opportunity [25][30].

Core Insights - Centerspace published its 2024 ESG Report and inaugural TCFD report, emphasizing its commitment to sustainable practices in the multifamily industry [1][3] - The company met four out of five ESG goals two years ahead of schedule and improved its GRESB score from 63 to 70 [2] Group 1: ESG Commitment - Centerspace's 2024 ESG report aligns with GRI's 2024 Universal Standards and the United Nations Sustainable Development Goals [2] - The company established an ESG Committee in 2019 to lead sustainability initiatives [1] Group 2: Climate Risk Management - The inaugural TCFD report serves as a foundation for managing climate risk and aligns with industry-standard reporting frameworks [3] - Centerspace is focused on continuous improvement in disclosure and climate risk mitigation [3] Group 3: Operational Practices - The company is committed to responsible business practices, including resource stewardship, waste reduction, and energy and water conservation [4] - Centerspace operates 73 apartment communities with a total of 13,773 homes across several states [4]

Group 1 - iREIT+HOYA Capital focuses on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The importance of patience in dividend stocks is highlighted, as a 10% drip on a higher-yielding stock is more significant for income investors compared to the same drop on the S&P 500 [2] - The article emphasizes a defensive investment approach with a medium- to long-term horizon [2]

Financial Data and Key Metrics Changes - CenterSpace reported a core FFO of $1.28 per diluted share for Q2 2025, driven by a 2.9% year-on-year increase in same-store NOI [16] - Same-store revenues increased by 2.7% year-on-year, with a 60 basis point increase in occupancy and a 2.1% increase in average monthly revenue per occupied home [16] - Same-store expenses rose by 2.4% year-on-year, with controllable expenses up 3.2% and non-controllable expenses up 1.2% [16] Business Line Data and Key Metrics Changes - The same-store portfolio experienced a 2.7% year-on-year revenue increase, contributing to a 2.9% growth in NOI [4] - Leasing spreads in Minneapolis increased by 2.7%, with new leases up 2.5% and renewals up 2.8% [7] - In Denver, leasing spreads remained challenged due to record supply, although there are expectations for improvement in the future [7] Market Data and Key Metrics Changes - The occupancy rate reached 96.1% in the quarter, supported by high retention of 60.2% [5] - The rent-to-income ratio for residents was reported at 22.5%, with same-store bad debt at approximately 40 basis points for the quarter [7] - Salt Lake City showed strong momentum with the second highest level of effective rent change among institutional markets [11] Company Strategy and Development Direction - The company is focused on capital recycling to improve portfolio metrics and increase exposure to institutional markets [5] - Recent acquisitions in Colorado and Utah, along with dispositions in Minnesota, are part of the strategy to enhance growth profiles [5] - The company aims to maintain best-in-class operations while driving shareholder results through continued earnings growth [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational platform's readiness for market repositioning efforts, with strong absorption rates in many markets [5] - The anticipated drop in supply in Denver, combined with expected job growth, is expected to turn current headwinds into tailwinds [7] - Management remains optimistic about the future despite macro volatility affecting stock prices [8] Other Important Information - An impairment charge of $14.5 million was booked due to the shorter holding period for properties being marketed for sale [17] - The company expanded its line of credit capacity by $150 million to facilitate recent acquisitions [19] Q&A Session Summary Question: Can you talk about any guardrails around dilution to offset organic growth? - Management indicated they are monitoring the balance sheet closely and aim to continue growing earnings year over year while managing temporary upticks in leverage [22][23] Question: Do you have any July leasing stats? - Management noted that trends from June continued, with Denver showing signs of improvement, although overall leasing remains healthy [24][25] Question: How have your expectations for top-line growth changed? - Expectations for Denver have been adjusted downward, but strong performance in tertiary markets has offset this [30] Question: Can you discuss the types of buyers for the assets being sold? - There is strong buyer interest with multiple offers from both local and national capital sources [32][33] Question: What is the long-term plan for leverage? - Management aims to reduce leverage below seven times over time, ideally targeting the low fives [36][37] Question: What are the cap rates on recent acquisitions? - Recent acquisitions had cap rates in the high fours, with specific rates of 4.8% for Railway and 4.65% for Sugar Mountain [42] Question: How is the company thinking about timing of capital allocation? - Management is not racing against a clock but is focused on taking advantage of opportunities as they arise [81][82]

Financial Performance - Centerspace (CSR) reported quarterly funds from operations (FFO) of $1.28 per share, exceeding the Zacks Consensus Estimate of $1.26 per share, and showing a slight increase from $1.27 per share a year ago [1] - The company achieved revenues of $68.55 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.48%, compared to $65.04 million in the same quarter last year [2] - Over the last four quarters, Centerspace has exceeded consensus FFO estimates three times and has topped consensus revenue estimates three times as well [2] Stock Performance - Centerspace shares have declined approximately 18.1% since the beginning of the year, while the S&P 500 has gained 6.1% [3] - The current consensus FFO estimate for the upcoming quarter is $1.23 on revenues of $67.8 million, and for the current fiscal year, it is $4.95 on revenues of $270.65 million [7] Industry Outlook - The REIT and Equity Trust - Residential industry, to which Centerspace belongs, is currently ranked in the top 39% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in estimate revisions, which can impact Centerspace's stock performance [5]

[Second Quarter 2025 Earnings Release](index=2&type=section&id=Second%20Quarter%202025%20Earnings%20Release) Centerspace reported Q2 2025 financial results, including a net loss, FFO growth, updated 2025 outlook, and recent acquisitions [Financial & Operating Highlights](index=2&type=section&id=Financial%20%26%20Operating%20Highlights) Centerspace reported a Q2 2025 net loss of **$0.87** per diluted share, with Core FFO growth and improved same-store NOI and occupancy Q2 2025 Key Financial Metrics (Per Share) | Per Common Share | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net loss - diluted | $(0.87) | $(0.19) | | FFO - diluted | $1.24 | $1.23 | | Core FFO - diluted | $1.28 | $1.27 | Q2 2025 Same-Store Performance vs. Prior Periods | Same-Store Results | Q2 2025 vs. Q2 2024 | Q2 2025 vs. Q1 2025 | | :--- | :--- | :--- | | Revenues | 2.7% | 1.1% | | Expenses | 2.4% | (1.3)% | | Net Operating Income (NOI) | 2.9% | 2.6% | Q2 2025 Same-Store Operating Metrics | Same-Store Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Weighted Average Occupancy | 96.1% | 95.9% | 95.5% | | Blended Lease Rate Growth | 2.4% | 0.6% | 3.4% | | Retention Rate | 60.2% | 49.2% | 59.1% | - Acquired Sugarmont, the company's first apartment community in Salt Lake City, Utah, for an aggregate purchase price of **$149.0 million**[5](index=5&type=chunk) - Total revenue for Q2 2025 increased by **5.4% to $68.5 million**, compared to **$65.0 million** for Q2 2024[5](index=5&type=chunk) [Balance Sheet](index=3&type=section&id=Balance%20Sheet) Centerspace maintained **$206.3 million** in total liquidity at Q2 2025, primarily from available credit lines and cash - The company had **$206.3 million** of total liquidity, consisting of **$194.0 million** available under lines of credit and **$12.4 million** in cash and cash equivalents[7](index=7&type=chunk) [Updated 2025 Financial Outlook](index=3&type=section&id=Updated%202025%20Financial%20Outlook) Centerspace updated its 2025 outlook, raising Same-Store NOI growth guidance and adjusting Core FFO per diluted share forecast Updated 2025 Financial Outlook | Metric | Previous Outlook for 2025 | Updated Outlook for 2025 | | :--- | :--- | :--- | | Net loss per Share – diluted | $(0.71) - $(0.45) | $2.50 - $2.76 | | Same-Store Revenue | 1.50% - 3.50% | 2.00% - 3.00% | | Same-Store Expenses | 2.00% - 4.00% | 1.00% - 2.50% | | Same-Store NOI | 1.25% - 3.25% | 2.50% - 3.50% | | FFO per Share – diluted | $4.73 - $4.97 | $4.70 - $4.83 | | Core FFO per Share – diluted | $4.86 - $5.10 | $4.88 - $5.00 | - Additional assumptions for the 2025 outlook include proceeds from dispositions of **$210.0 million to $230.0 million** and value-add expenditures of **$16.0 million to $18.0 million**[13](index=13&type=chunk) [Subsequent Events](index=3&type=section&id=Subsequent%20Events) Post-quarter, Centerspace acquired Railway Flats, a 420-home apartment community in Loveland, CO, for **$132.2 million** - On July 29, 2025, the company acquired Railway Flats in Loveland, CO, for **$132.2 million**, which included assuming **$76.5 million** of mortgage debt[10](index=10&type=chunk) [Supplemental Financial and Operating Data](index=5&type=section&id=Supplemental%20Financial%20and%20Operating%20Data) This section provides detailed financial statements, non-GAAP reconciliations, debt analysis, and portfolio performance metrics [Common Share Data](index=6&type=section&id=Common%20Share%20Data) This section details Centerspace's common share performance and capitalization, including closing price, dividend yield, and market value Common Share Data Comparison | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Closing price at end of quarter | $60.19 | $67.63 | | Closing price dividend yield – annualized | 5.1% | 4.4% | | Total closing common shares, LP units, and Series E units (thousands) | 19,623 | 17,938 | | Closing market value (thousands) | $1,181,108 | $1,213,147 | [Key Financial Data](index=7&type=section&id=Key%20Financial%20Data) This section presents Centerspace's Condensed Consolidated Statements of Operations and Balance Sheets, detailing financial performance and position [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q2 2025 revenue increased to **$68.5 million**, but a **$14.5 million** impairment charge led to a **$16.8 million** net loss Q2 2025 Statement of Operations Summary (in thousands) | Line Item | Three Months Ended 6/30/2025 | Three Months Ended 6/30/2024 | | :--- | :--- | :--- | | **REVENUE** | **$68,549** | **$65,043** | | Impairment of real estate investments | $14,543 | $— | | **TOTAL EXPENSES** | **$75,345** | **$57,851** | | Operating income (loss) | $(6,796) | $7,192 | | **NET LOSS** | **$(16,785)** | **$(1,663)** | | Net loss per common share - diluted | $(0.87) | $(0.19) | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Centerspace reported **$2.01 billion** in total assets and **$1.17 billion** in total liabilities, with **$137.4 million** in assets held for sale Balance Sheet Summary (in thousands) | Line Item | As of 6/30/2025 | As of 12/31/2024 | | :--- | :--- | :--- | | Total real estate investments | $1,809,608 | $1,854,761 | | Assets held for sale, net | $137,366 | $— | | **TOTAL ASSETS** | **$2,013,239** | **$1,913,707** | | Revolving lines of credit | $216,030 | $47,359 | | **TOTAL LIABILITIES** | **$1,168,347** | **$1,014,704** | | **TOTAL EQUITY** | **$833,582** | **$882,443** | [Non-GAAP Financial Measures and Reconciliations](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section provides detailed reconciliations for key non-GAAP metrics, including NOI, FFO, Core FFO, and Adjusted EBITDA [Net Operating Income (NOI)](index=10&type=section&id=Net%20Operating%20Income%20(NOI)) Total NOI increased **5.4%** to **$42.0 million** in Q2 2025, driven by a **2.9%** rise in same-store NOI Q2 2025 NOI Reconciliation and Breakdown (in thousands) | Category | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating income (loss) | $(6,796) | $7,192 | (194.5)% | | **Net operating income (Total)** | **$42,018** | **$39,854** | **5.4%** | | Same-store NOI | $36,193 | $35,171 | 2.9% | [Same-Store Controllable Expenses](index=12&type=section&id=Same-Store%20Controllable%20Expenses) Q2 2025 same-store operating expenses rose **2.4%**, with controllable expenses up **3.2%** and non-controllable expenses up **1.2%** Q2 2025 Same-Store Expense Breakdown (in thousands) | Expense Category | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Controllable Expenses | $13,444 | $13,026 | 3.2% | | Total Non-controllable Expenses | $8,436 | $8,337 | 1.2% | | **Total Same-Store Expenses** | **$21,880** | **$21,363** | **2.4%** | [Funds From Operations (FFO) and Core FFO](index=13&type=section&id=Funds%20From%20Operations%20(FFO)%20and%20Core%20FFO) Q2 2025 FFO per diluted share was **$1.24**, and Core FFO was **$1.28**, reflecting adjustments for depreciation and impairment Q2 2025 FFO and Core FFO Reconciliation (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net loss available to common shareholders | $(14,515) | $(2,903) | | FFO applicable to common shares and Units | $24,537 | $22,143 | | Core FFO applicable to common shares and Units | $25,297 | $22,801 | | **FFO per share and Unit - diluted** | **$1.24** | **$1.23** | | **Core FFO per share and Unit - diluted** | **$1.28** | **$1.27** | [Adjusted EBITDA](index=14&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA for Q2 2025 was **$34.9 million**, with the six-month total reaching **$67.6 million**, after adjusting for non-operating items Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended 6/30/2025 | Three Months Ended 6/30/2024 | | :--- | :--- | :--- | | Net loss attributable to controlling interests | $(14,515) | $(1,296) | | **Adjusted EBITDA** | **$34,939** | **$33,070** | [Debt and Capital Analysis](index=15&type=section&id=Debt%20and%20Capital%20Analysis) This section provides an overview of Centerspace's debt profile, capital structure, maturity schedule, and key capitalization metrics [Debt Analysis](index=15&type=section&id=Debt%20Analysis) As of June 30, 2025, total debt was **$1.11 billion** with a **3.90%** weighted average interest rate, primarily long-term Debt Maturity Schedule as of June 30, 2025 | Maturity Year | Total Debt (in thousands) | % of Total Debt | | :--- | :--- | :--- | | 2025 (remainder) | $19,065 | 1.7% | | 2026 | $99,843 | 8.9% | | 2027 | $47,703 | 4.3% | | 2028 | $331,449 | 29.6% | | 2029 | $101,754 | 9.1% | | Thereafter | $521,478 | 46.4% | | **Subtotal** | **$1,121,292** | **100.0%** | - The weighted average interest rate on total debt was **3.90%** as of June 30, 2025, up from **3.62%** a year prior[50](index=50&type=chunk) [Capital Analysis](index=16&type=section&id=Capital%20Analysis) Q2 2025 total market capitalization was **$2.31 billion**, with total debt to market capitalization at **48.5%** and Net Debt to Adjusted EBITDA at **7.93x** Key Capitalization Metrics | Metric | 6/30/2025 | 6/30/2024 | | :--- | :--- | :--- | | Total market capitalization (in thousands) | $2,313,710 | $2,259,236 | | Total debt to total market capitalization | 48.5% | 41.4% | | Net debt/Adjusted EBITDA | 7.93x | 6.97x | | Payout ratio (Core FFO basis) | 60.2% | 59.1% | [Portfolio Analysis](index=17&type=section&id=Portfolio%20Analysis) This section details Centerspace's property portfolio, including same-store performance by region, overall operating metrics, and capital expenditures [Same-Store Comparisons](index=17&type=section&id=Same-Store%20Comparisons) Same-store NOI grew **2.9%** in Q2 2025, with regional variations, and weighted average occupancy increased to **96.1%** Q2 2025 Same-Store Performance by Region (vs. Q2 2024) | Region | NOI % Change | Weighted Average Occupancy | Average Monthly Rental Rate | | :--- | :--- | :--- | :--- | | Denver, CO | (5.9)% | 93.8% | $1,973 | | Minneapolis, MN | 5.2% | 96.6% | $1,598 | | North Dakota | 10.0% | 97.2% | $1,404 | | Omaha, NE | 13.4% | 94.2% | $1,393 | | **Same-Store Total** | **2.9%** | **96.1%** | **$1,621** | [Portfolio Summary](index=20&type=section&id=Portfolio%20Summary) Centerspace's total portfolio comprised **11,842** homes with **94.5%** occupancy and an average monthly rental rate of **$1,625** Portfolio Metrics (All Communities) | Metric | 6/30/2025 | 6/30/2024 | | :--- | :--- | :--- | | Number of Apartment Homes | 11,842 | 12,883 | | Average Monthly Rental Rate | $1,625 | $1,566 | | Weighted Average Occupancy | 94.5% | 95.3% | [Capital Expenditures](index=21&type=section&id=Capital%20Expenditures) Total capital spending was **$11.1 million** in Q2 2025, with same-store recurring capital expenditures at **$4.1 million** Capital Expenditures Summary (in thousands) | Category | Three Months Ended 6/30/2025 | Three Months Ended 6/30/2024 | | :--- | :--- | :--- | | Recurring Capital Expenditures - Same-Store | $4,100 | $2,850 | | Total Value Add - Same Store | $2,643 | $5,228 | | **Total Capital Spend - All Properties** | **$11,056** | **$15,537** | [2025 Revised Financial Outlook](index=22&type=section&id=2025%20Revised%20Financial%20Outlook) Centerspace revised its 2025 financial outlook, increasing Same-Store NOI growth guidance and adjusting Core FFO per diluted share Comparison of 2025 Full-Year Outlook | Metric | 2025 Previous Outlook Range | 2025 Updated Outlook Range | | :--- | :--- | :--- | | Same-Store Revenue Growth | 1.50% - 3.50% | 2.00% - 3.00% | | Same-Store Expense Growth | 2.00% - 4.00% | 1.00% - 2.50% | | Same-Store NOI Growth | 1.25% - 3.25% | 2.50% - 3.50% | | Core FFO per diluted share | $4.86 - $5.10 | $4.88 - $5.00 | - The updated outlook includes new assumptions for proceeds from dispositions, estimated to be between **$210.0 million and $230.0 million** for the full year[78](index=78&type=chunk) Reconciliation of 2025 Updated Outlook: Net Income to Core FFO | Metric (per share) | Low | High | | :--- | :--- | :--- | | Net (income) loss per share - diluted | $2.50 | $2.76 | | FFO per share - diluted | $4.70 | $4.83 | | Core FFO per share - diluted | $4.88 | $5.00 | [Non-GAAP Financial Measures and Other Terms](index=24&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Other%20Terms) This section defines non-GAAP financial measures and key operating terms, including FFO, Core FFO, NOI, and Adjusted EBITDA - Funds From Operations (FFO) is defined according to Nareit standards as net income excluding real estate depreciation, gains/losses from property sales, and impairment write-downs[93](index=93&type=chunk)[94](index=94&type=chunk)[99](index=99&type=chunk) - Core FFO is a further adjustment to FFO, removing non-routine items or items not considered core to business operations to provide a clearer view of ongoing performance[97](index=97&type=chunk) - Net Operating Income (NOI) is defined as total real estate revenues less property operating expenses, used as a measure of property-level performance[103](index=103&type=chunk) - Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, and other non-operating or non-routine items, serving as a supplemental measure of income from operations[87](index=87&type=chunk)

Part I. Financial Information [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company reported a $16.8 million net loss in Q2 2025, driven by a $14.5 million impairment charge, despite 5.4% revenue growth and total assets reaching $2.01 billion [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $2.01 billion by June 30, 2025, primarily due to assets held for sale, while total liabilities rose to $1.17 billion, leading to a decrease in total equity Condensed Consolidated Balance Sheet Summary (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$2,013,239** | **$1,913,707** | | Total real estate investments | $1,809,608 | $1,854,761 | | Assets held for sale, net | $137,366 | $— | | **Total Liabilities** | **$1,168,347** | **$1,014,704** | | Revolving lines of credit | $216,030 | $47,359 | | Mortgages payable, net | $595,668 | $608,506 | | **Total Equity** | **$833,582** | **$882,443** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) Q2 2025 revenue grew 5.4% to $68.5 million, but a $16.8 million net loss was recorded, primarily due to a $14.5 million impairment charge and higher interest expense Q2 and H1 2025 vs 2024 Performance (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$68,549** | **$65,043** | **$135,642** | **$129,549** | | Total Expenses | $75,345 | $57,851 | $137,692 | $117,705 | | Impairment of real estate | $14,543 | $— | $14,543 | $— | | Interest Expense | $(10,724) | $(9,332) | $(20,359) | $(18,539) | | **Net Loss** | **$(16,785)** | **$(1,663)** | **$(20,966)** | **$(6,455)** | | **Net Loss per Share** | **$(0.87)** | **$(0.19)** | **$(1.09)** | **$(0.56)** | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations was $50.7 million for H1 2025, while investing activities used $164.5 million, largely for real estate acquisitions, offset by $118.8 million from financing activities Six Months Ended June 30 Cash Flow Summary (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $50,694 | $47,264 | | Net cash used by investing activities | $(164,468) | $(28,416) | | Net cash provided by (used by) financing activities | $118,838 | $(12,705) | | **Net increase in cash** | **$5,064** | **$6,143** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the company's REIT operations, including a $149.0 million acquisition, a $14.5 million impairment on assets held for sale, and total debt reaching $1.11 billion - As of June 30, 2025, Centerspace is a REIT focused on owning and managing 72 apartment communities comprising 13,353 apartment homes[25](index=25&type=chunk) - During Q2 2025, the company acquired the 341-home Sugarmont property in Salt Lake City, UT, for **$149.0 million**[101](index=101&type=chunk)[102](index=102&type=chunk) - A loss of **$14.5 million** was recorded for the impairment of five apartment communities, which were written down to fair value upon being classified as held for sale[54](index=54&type=chunk) - Subsequent to the quarter's end, on July 29, 2025, the company acquired Railway Flats, a 420-home community in Loveland, CO, for **$132.2 million**, including the assumption of **$76.5 million** in mortgage debt[131](index=131&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported a 5.4% revenue increase in Q2 2025, but a net loss of $0.87 per share due to a $14.5 million impairment, while Core FFO per share slightly increased to $1.28 [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Q2 2025 revenue grew 5.4% to $68.5 million, with same-store NOI up 2.9%, but the net loss widened to $16.8 million due to a $14.5 million impairment and higher interest expense Same-Store Performance Analysis (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Same-Store Revenue | $58,073k | $56,534k | 2.7% | | Same-Store Property Operating Expenses | $21,880k | $21,363k | 2.4% | | **Same-Store NOI** | **$36,193k** | **$35,171k** | **2.9%** | | Same-Store Weighted Average Occupancy | 96.1% | 95.5% | 0.6% | - The company recorded a **$14.5 million** impairment on five apartment communities that were reclassified to assets held for sale, which was the primary driver of the quarterly net loss[166](index=166&type=chunk) - Interest expense increased by **14.9%** in Q2 2025, primarily due to a higher outstanding balance on lines of credit used to fund a recent acquisition[170](index=170&type=chunk) [Funds from Operations and Core Funds from Operations](index=33&type=section&id=Funds%20from%20Operations%20and%20Core%20Funds%20from%20Operations) Q2 2025 FFO increased 10.8% to $24.5 million, with Core FFO per diluted share slightly rising to $1.28, reflecting improved NOI and the absence of prior-year preferred dividends FFO and Core FFO Reconciliation (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net loss available to common shareholders | $(14,515) | $(2,903) | | FFO applicable to common shares and Units | $24,537 | $22,143 | | Core FFO applicable to common shares and Units | $25,297 | $22,801 | | **FFO per share and Unit - diluted** | **$1.24** | **$1.23** | | **Core FFO per share and Unit - diluted** | **$1.28** | **$1.27** | [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, total liquidity was $206.3 million, supported by an expanded $400.0 million Unsecured Credit Facility, with major capital uses including a $150.1 million property acquisition - Total liquidity was approximately **$206.3 million** as of June 30, 2025, including **$194.0 million** available on lines of credit and **$12.4 million** in cash[191](index=191&type=chunk) - In May 2025, the company expanded its Unsecured Credit Facility borrowing capacity from **$250.0 million** to **$400.0 million**[192](index=192&type=chunk) - The company's share repurchase program, which authorized up to **$50.0 million** in repurchases, expired on March 10, 2025. No shares were repurchased in the first six months of 2025[201](index=201&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate fluctuations on variable-rate debt, with no material changes reported for the quarter - The company's main market risk is from interest rate changes affecting its variable rate debt. No material changes were reported for the quarter[214](index=214&type=chunk)[215](index=215&type=chunk)[216](index=216&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting - The CEO and CFO concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective[217](index=217&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[218](index=218&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material pending legal proceedings beyond routine litigation incidental to its business - The company is not a party to any material pending legal proceedings[220](index=220&type=chunk) [Item 1A. Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported in the current period - No material changes to previously disclosed risk factors were reported[221](index=221&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company issued unregistered common shares and redeemed 52,500 Series D preferred units, while its $50.0 million share repurchase program expired - The company's **$50.0 million** share repurchase program expired on March 10, 2025[224](index=224&type=chunk) Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Number of Shares and Units Purchased | Average Price Paid per Share and Unit | | :--- | :--- | :--- | | April 1 - 30, 2025 | 30 | $64.01 | | May 1 - 31, 2025 | — | — | | June 1 - 30, 2025 | 52,500 | $100.00 | | **Total** | **52,530** | **$99.98** | [Item 5. Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No trustees or executive officers adopted or terminated Rule 10b5-1 trading plans during Q2 2025 - No company trustees or executive officers adopted or terminated a Rule 10b5-1 trading plan during the quarter[225](index=225&type=chunk) [Item 6. Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section indexes all exhibits filed with the Form 10-Q, including corporate governance documents, incentive plans, and CEO/CFO certifications - The report includes standard exhibits such as CEO/CFO certifications under Sections 302 and 906, and financial data formatted in iXBRL[228](index=228&type=chunk)

Core Insights - Centerspace reported a net loss of $0.87 per diluted share for Q2 2025, compared to a net loss of $0.19 per diluted share in Q2 2024 [7] - Funds from Operations (FFO) per diluted share for Q2 2025 was $1.24, a decrease from $1.28 in Q2 2024 [2][7] - Core FFO per diluted share increased by 0.8% to $1.28 for Q2 2025, compared to $1.27 for the same period in 2024 [7] Financial Performance - Revenue for Q2 2025 increased by $3.5 million or 5.4% to $68.5 million, compared to $65.0 million for Q2 2024 [7] - Same-store revenues increased by 2.7% for Q2 2025 compared to Q2 2024, contributing to a 2.9% increase in same-store Net Operating Income (NOI) [7] - Same-store expenses rose by 2.4% year-over-year, while sequentially they decreased by 1.3% [2] Operational Metrics - Weighted average occupancy for Q2 2025 was 96.1%, up from 95.5% in Q2 2024 [2] - New lease rate growth was 2.1% for Q2 2025, while renewal lease rate growth was 2.6% [2] - The retention rate improved to 60.2% in Q2 2025 from 49.2% in Q2 2024 [2] Balance Sheet and Liquidity - As of the end of Q2 2025, Centerspace had total liquidity of $206.3 million, including $194.0 million available under lines of credit and $12.4 million in cash [5] - The company updated its 2025 financial outlook, projecting a net loss per share of $(0.71) to $(0.45) and FFO per share of $4.70 to $4.83 [9] Recent Developments - Centerspace acquired Sugarmont, its first apartment community in Salt Lake City, for $149.0 million [7] - On July 29, 2025, the company closed on the acquisition of Railway Flats, a 420-home apartment community in Loveland, CO, for $132.2 million [10]