Core Viewpoint - Elme Communities has entered into a Purchase and Sale Agreement with Cortland Partners to sell a 19-asset portfolio for $1.6 billion, initiating a plan for voluntary liquidation and asset sales to maximize shareholder value [1][2][3] Financial Distributions - The company plans to make total upfront distributions to shareholders of approximately $14.68 to $15.00 per share, assuming the completion of the Cortland Portfolio Transaction [1][6] - Additional liquidating distributions are estimated to be approximately $2.90 to $3.50 per share from the sale of remaining assets [1][6] Transaction Details - The Portfolio Sale Transaction is expected to close in the fourth quarter of 2025, pending shareholder approval and customary closing conditions [1][11] - The company will market its remaining nine multifamily assets and Watergate 600 for sale within the next 12 months [2][11] Strategic Review Process - The decision to proceed with the sale and liquidation followed a comprehensive evaluation of strategic alternatives, including engagement with over 80 potential counterparties [3][11] - The Board of Trustees unanimously determined that the sale to Cortland and subsequent asset sales would yield the highest value for shareholders compared to other options [3][11] Future Operations - Following the completion of the Portfolio Sale Transaction, the company expects to suspend regular quarterly distributions and focus on liquidating distributions from future asset sales [10][11] - The company has received a debt commitment of $520 million from Goldman Sachs Bank USA to finance assets not included in the Portfolio Sale Transaction [9] Market Presence - The transaction marks Cortland's significant expansion in the greater Washington, D.C. area and Georgia, enhancing its portfolio and operational capabilities [3][4]

Group 1 - Elme Communities will release its second quarter earnings results on August 5, 2025, after market close [1] - A conference call to discuss the earnings results is scheduled for August 6, 2025, at 10:00 am ET [1] - Instant replay of the conference call will be available until August 20, 2025, at 11:59 pm ET [1] Group 2 - Elme Communities is a multifamily real estate investment trust focused on providing quality, affordable homes in the Washington, DC metro and the Sunbelt [2] - The company aims to serve a deep, solid, and underserved base of mid-market demand, building long-term value for shareholders [2]

Industry Overview - The Zacks REIT and Equity Trust - Residential industry includes companies that own, develop, and manage various residential properties, generating revenues by renting spaces to tenants [3] - The demand for student housing is closely tied to enrollment growth at educational institutions, making it a key driver for this market segment [3] Current Market Dynamics - Strong rental demand is supported by a resilient labor market, demographic trends driving household formation, and rising homeownership costs making renting more attractive [1][4] - Residential REITs are leveraging technology to enhance tenant experience and improve operational efficiency [5] - Economic uncertainty and regional oversupply of apartments are creating challenges, potentially dampening consumer confidence and affecting renter affordability [2][6][7] Performance Metrics - The REIT and Equity Trust - Residential industry has underperformed the broader Zacks Finance sector and the S&P 500 over the past year, returning 0.5% compared to the S&P 500's increase of 9.6% [11] - The industry is currently trading at a forward 12-month price-to-FFO ratio of 16.46, above the Finance sector's forward P/E of 16.11 but below the S&P 500's forward P/E of 21.89 [14] Future Outlook - The industry is positioned in the top 38% of around 250 Zacks industries, indicating robust near-term prospects [8][9] - Analysts are gaining confidence in the growth potential of the industry, as reflected in upward revisions of funds from operations (FFO) per share estimates [10] Investment Opportunities - Veris Residential focuses on Class A multifamily properties in high-demand Northeast markets, with upward revisions in FFO per share estimates suggesting growth potential [19][21] - Elme Communities targets value-oriented multifamily assets in supply-constrained markets, with a projected net operating income upside in 2025 [23][24][25] - NexPoint Residential Trust offers exposure to middle-income multifamily assets in high-growth Sunbelt markets, with upward revisions in FFO per share estimates indicating strong performance [26][27][28]

Financial Data and Key Metrics Changes - The company reported same store revenue growth of 3.9% and NOI growth of 5.5% year over year, driven by stronger rent growth in the Washington Metro portfolio and favorable real estate tax appeals in Atlanta [15] - The annualized net debt to adjusted EBITDA was 5.6 times during the first quarter, with over 60% of total capacity available on the line of credit and no secured debt [16] Business Line Data and Key Metrics Changes - Same store multifamily occupancy averaged 94.8% during the first quarter, up 50 basis points year over year [11] - The company achieved 1.9% same store blended lease rate growth during the quarter, with an initial estimated blended rate growth for April at 2.6% [11] Market Data and Key Metrics Changes - In the Washington Metro area, annual supply peaked at 2.2% annual net inventory growth, below the national average of 2.9%, with new construction starts down over 70% from their peak [8] - Northern Virginia's private sector job growth was two and a half times that of the broader Washington Metro Region over the past four years [6] Company Strategy and Development Direction - The company is undergoing a formal evaluation of strategic alternatives to maximize shareholder value, initiated from a position of strength [9] - The managed WiFi program is expected to generate additional NOI of $600,000 to $800,000 in 2025, with potential for $1,500,000 to $2,000,000 annually once fully integrated [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong fundamentals of the portfolio and business, despite a volatile macro environment [16] - The company anticipates improvement in bad debt to contribute more significantly to revenue growth in 2025 than initially expected [15] Other Important Information - The company completed 88 renovations during the quarter with an ROI of approximately 18% and plans to complete over 500 full renovations in 2025 [13] - Eviction delays in Atlanta are decreasing, supported by improved processing efficiency and legislative changes [12] Q&A Session Summary Question: Insights on the multifamily transaction market in DC - Management noted that the living sector is performing well with continued capital flows and active lenders, observing cap rates ranging from 4.25% to 5.25% depending on buyer profiles [20][22] Question: Addition of Ron to the Board and its timing - The strategic review was initiated last year, and Ron was seen as an appropriate candidate for the Board due to his skills and operating history [24][25] Question: Acceleration of the WiFi initiative income - The rollout of the Managed WiFi initiative has progressed faster than anticipated, allowing for quicker income generation [30] - There will be associated expenses, but they are expected to be less significant compared to the income generated [31] Question: Shift in revenue composition and guidance - Management confirmed that while the first quarter exceeded expectations, guidance remains unchanged as the busy leasing season approaches [34]

Financial Data and Key Metrics Changes - The company reported same store revenue growth of 3.9% and NOI growth of 5.5% year over year, driven by stronger rent growth in the Washington Metro portfolio and favorable real estate tax appeals in Atlanta [15] - The annualized net debt to adjusted EBITDA was 5.6 times during the first quarter, with over 60% of total capacity available on the line of credit and no secured debt [16] Business Line Data and Key Metrics Changes - Same store multifamily occupancy averaged 94.8% during the first quarter, up 50 basis points year over year, with a 1.9% same store blended lease rate growth [11] - The managed WiFi program is expected to generate an additional NOI of $600,000 to $800,000 in 2025 from the initial seven communities, with potential to reach $1,500,000 to $2,000,000 annually once fully integrated by mid-2026 [13][14] Market Data and Key Metrics Changes - In the Washington Metro area, annual supply peaked at 2.2% annual net inventory growth, below the national average of 2.9%, with projections to decline to 1.1% by Q4 2026, the lowest level since 2012 [8] - Northern Virginia's private sector job growth was two and a half times that of the broader Washington Metro Region over the past four years, indicating strong employment fundamentals [6] Company Strategy and Development Direction - The company is undergoing a formal evaluation of strategic alternatives to maximize shareholder value, initiated from a position of strength as a multifamily REIT [9][10] - The company is focused on enhancing its value-add renovation pipeline and platform initiatives to ensure resilient performance despite macroeconomic fluctuations [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong fundamentals of the portfolio and business, despite potential economic slowdowns and employment losses [5][16] - The company anticipates that improvements in bad debt recovery will contribute more significantly to revenue growth in 2025 than initially expected [15] Other Important Information - The company completed 88 renovations during the quarter with an ROI of approximately 18%, and plans to complete over 500 full renovations in 2025 [13] - The company is closely monitoring forward-looking demand indicators and plans to adjust pricing strategies accordingly [12] Q&A Session Summary Question: Insights on the multifamily transaction market in DC - Management noted that the living sector is performing well with continued capital flows and active lenders, indicating a competitive market with cap rates ranging from 4.25% to 5.25% depending on buyer profiles [19][22] Question: Addition of Ron to the Board and its timing - Management explained that the decision for a strategic review was made last year, and Ron's addition to the Board was part of an ongoing refreshment process to maximize shareholder value [24][25] Question: Acceleration of the WiFi initiative income - Management indicated that the rollout of the Managed WiFi initiative is progressing faster than anticipated, allowing for quicker income generation, although there will be associated expenses [29][31] Question: Shift in revenue composition and guidance - Management confirmed that while there is a strong first quarter performance, guidance remains unchanged as the busy leasing season is just beginning, with more leases to be turned over [32][34]

Financial Data and Key Metrics Changes - The company reported same store revenue growth of 3.9% and NOI growth of 5.5% year over year, driven by stronger rent growth in the Washington Metro portfolio and favorable real estate tax appeals in Atlanta [15][16] - The annualized net debt to adjusted EBITDA was 5.6 times during the first quarter, with over 60% of total capacity available on the line of credit and no secured debt [16] Business Line Data and Key Metrics Changes - Same store multifamily occupancy averaged 94.8% during Q1, up 50 basis points year over year, with a 1.9% same store blended lease rate growth during the quarter [11] - The initial estimated blended rate growth for April is 2.6%, indicating a typical upswing heading into the spring leasing season [11] Market Data and Key Metrics Changes - In the Washington Metro area, annual supply peaked at 2.2% annual net inventory growth in Q1 2025, below the national average of 2.9%, with projections for a decline to 1.8% by Q4 2025 and further to 1.1% by Q4 2026 [7][8] - Northern Virginia's private sector job growth was two and a half times that of the broader Washington Metro Region over the past four years, positioning the company favorably [6] Company Strategy and Development Direction - The Board of Trustees is overseeing a formal evaluation of strategic alternatives to maximize shareholder value, initiated from a position of strength [9][10] - The company is focused on enhancing its multifamily REIT performance and profitability while navigating the current volatility in capital markets [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong fundamentals of the portfolio and business, despite a fluctuating macro environment, and highlighted the ongoing success of the value-add renovation pipeline [16] - The company anticipates that improvement in bad debt will contribute more significantly to revenue growth in 2025 than initially expected [15] Other Important Information - The company completed 88 renovations during the quarter with an ROI of approximately 18%, aiming to complete over 500 full renovations in 2025 [13] - The managed WiFi program is expected to generate additional NOI of $600,000 to $800,000 in 2025 from the initial seven communities, with further upside anticipated from future phases [14] Q&A Session Summary Question: Insights on the multifamily transaction market in DC - Management noted that the living sector is performing well with continued capital flows and active lenders, indicating a competitive environment with cap rates ranging from 4.25% to 5.25% depending on the buyer profile [19][22] Question: Addition of Ron to the Board and its timing - The strategic review process was initiated last year, and Ron's addition to the Board was part of a refreshment process aimed at maximizing shareholder value [23][24] Question: Acceleration of the WiFi initiative income - The rollout of the Managed WiFi initiative has progressed faster than anticipated, allowing for quicker income generation as the spring leasing season approaches [28][29]

Core Viewpoint - Elme (ELME) reported quarterly funds from operations (FFO) of $0.24 per share, exceeding the Zacks Consensus Estimate of $0.23 per share, marking a 4.35% surprise [1] Financial Performance - The company achieved revenues of $61.49 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.61% and showing an increase from $59.51 million year-over-year [2] - Over the last four quarters, Elme has exceeded consensus revenue estimates three times [2] Stock Performance and Outlook - Elme shares have increased approximately 2% since the beginning of the year, contrasting with the S&P 500's decline of -5.3% [3] - The future performance of Elme's stock will largely depend on management's commentary during the earnings call and the company's FFO outlook [3][4] Estimate Revisions - The current consensus FFO estimate for the upcoming quarter is $0.24 on revenues of $61.6 million, and for the current fiscal year, it is $0.95 on revenues of $247.63 million [7] - The estimate revisions trend for Elme is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The REIT and Equity Trust - Residential industry, to which Elme belongs, is currently ranked in the bottom 42% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Investor Presentation May 2025 This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities of Elme Communities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification of such securities under the securities law of any such jurisdiction. If Elme Communities were to conduct an offering of securities in the future, it will be made under an effective regi ...

First Quarter 2025 Results & Outlook [Financial and Operational Highlights](index=2&type=section&id=Financial%20and%20Operational%20Highlights) Elme Communities reported a net loss of $0.05 per diluted share, with Core FFO per diluted share increasing to $0.24, driven by strong operational performance Q1 2025 Financial Results per Diluted Share | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss per diluted share | $(0.05) | $(0.04) | | Core FFO per diluted share | $0.24 | $0.23 | - The CEO noted that while federal workforce reductions are a factor, the company's focus on mid-market rents and its strong presence in Northern Virginia are expected to support resilient performance[4](index=4&type=chunk) - Same-store multifamily NOI increased by **5.5%** year-over-year[5](index=5&type=chunk) - Same-store multifamily Average Occupancy rose by **0.5%** to **94.8%** year-over-year[5](index=5&type=chunk) - Effective blended Lease Rate Growth was **1.9%**, driven by **5.0%** growth on renewals, offset by a **(2.0)%** decline on new leases[5](index=5&type=chunk) - The company maintained a strong balance sheet with **$324 million** in available liquidity and an annualized Net Debt to Adjusted EBITDA ratio of **5.6x**[5](index=5&type=chunk) [Strategic Review & 2025 Guidance](index=3&type=section&id=Strategic%20Review%20%26%202025%20Guidance) The Board initiated a strategic review to maximize shareholder value, while the company reiterated its full-year 2025 Core FFO per diluted share guidance - The Board of Trustees has initiated a formal review to evaluate strategic alternatives for the company, which is currently ongoing[6](index=6&type=chunk) Full Year 2025 Guidance (in millions) | Metric | Guidance Range | | :--- | :--- | | **Core FFO per diluted share** | **$0.91 - $0.97** | | Same-store multifamily Revenue growth | 2.1% - 3.6% | | Same-store multifamily Expense growth | 2.75% - 4.25% | | Same-store multifamily NOI growth | 1.5% - 3.5% | | Other same-store NOI (Watergate 600) | $11.5 - $12.25 | | G&A, net of core adjustments | $25.25 - $26.25 | | Interest expense | $37.35 - $38.35 | 2025 Guidance Reconciliation: Net Loss to Core FFO per Share | | Low | High | | :--- | :--- | :--- | | Net loss per diluted share | $(0.17) | $(0.11) | | Real estate depreciation and amortization | 1.05 | 1.05 | | NAREIT FFO per diluted share | 0.88 | 0.94 | | Core adjustments | 0.03 | 0.03 | | **Core FFO per diluted share** | **$0.91** | **$0.97** | [Dividends](index=4&type=section&id=Dividends) Elme Communities declared a quarterly dividend of $0.18 per share, payable on July 3, 2025, to shareholders of record as of June 17, 2025 - The Board of Trustees declared a quarterly dividend of **$0.18 per share**[11](index=11&type=chunk) - The dividend will be paid on July 3, 2025, to shareholders of record on June 17, 2025[11](index=11&type=chunk) Financial Statements and Key Data [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) Elme reported Q1 2025 total real estate rental revenue of $61.5 million, with a net loss of $4.7 million, primarily due to higher general and administrative expenses Q1 2025 Statement of Operations (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Real estate rental revenue | $61,493 | $59,513 | | Total Expenses | $56,708 | $55,076 | | Real estate operating income | $4,785 | $4,437 | | Interest expense | $(9,460) | $(9,494) | | **Net loss** | **$(4,675)** | **$(3,647)** | Per Share Data | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss (Diluted) | $(0.05) | $(0.04) | | NAREIT FFO (Diluted) | $0.21 | $0.24 | | Dividends paid | $0.18 | $0.18 | [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2025, Elme's total assets were $1.83 billion, with total liabilities at $764.4 million and total equity at $1.06 billion Balance Sheet Highlights (in thousands) | Category | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total real estate held for investment, net | $1,778,889 | $1,796,014 | | Cash and cash equivalents | $6,396 | $6,144 | | **Total assets** | **$1,827,579** | **$1,845,762** | | Notes payable, net | $523,061 | $522,953 | | Line of credit | $182,000 | $176,000 | | **Total liabilities** | **$764,378** | **$763,684** | | **Total equity** | **$1,063,201** | **$1,082,078** | [Funds From Operations (FFO) and Adjusted Funds From Operations (AFFO)](index=10&type=section&id=Funds%20From%20Operations%20(FFO)%20and%20Adjusted%20Funds%20From%20Operations%20(AFFO)) In Q1 2025, NAREIT FFO was $18.6 million, while Core FFO increased to $21.6 million and Core AFFO reached $21.2 million Q1 2025 FFO Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(4,675) | $(3,647) | | Real estate depreciation and amortization | 23,239 | 24,943 | | **NAREIT FFO** | **18,564** | **21,296** | | Other non-operating expenses | 3,041 | — | | Gain on land easements | — | (1,410) | | **Core FFO** | **$21,605** | **$19,886** | Q1 2025 AFFO Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | NAREIT FFO | $18,564 | $21,296 | | Recurring capital improvements | (2,917) | (2,771) | | Other adjustments | 2,555 | 2,113 | | **AFFO** | **18,202** | **20,638** | | Other non-operating expenses | 3,041 | — | | Gain on land easements | — | (1,410) | | **Core AFFO** | **$21,243** | **$19,228** | Portfolio Analysis [Same-Store Multifamily Operating Results](index=20&type=section&id=Same-Store%20Multifamily%20Operating%20Results) Same-store multifamily NOI grew **5.5%** to **$36.5 million** in Q1 2025, driven by revenue growth and improved average occupancy of **94.8%** Q1 2025 Same-Store Multifamily Performance vs. Q1 2024 | Region | Revenue % Chg | Expense % Chg | NOI % Chg | Avg Occupancy % | Avg Rent % Chg | | :--- | :--- | :--- | :--- | :--- | :--- | | Virginia | 4.5% | 0.4% | 6.5% | 96.5% | 3.5% | | DC / Maryland | 2.0% | 2.2% | 1.9% | 94.9% | 1.9% | | Georgia | 3.6% | 2.4% | 4.6% | 90.6% | (4.4)% | | **Total** | **3.9%** | **1.2%** | **5.5%** | **94.8%** | **1.7%** | - Sequentially, total same-store NOI increased by **2.3%** from Q4 2024, largely due to a significant **11.2%** decrease in operating expenses in the Georgia portfolio[60](index=60&type=chunk) - Blended lease rate growth for the quarter was **1.9%**, composed of a **5.0%** increase on renewals and a **(2.0)%** decrease on new leases[57](index=57&type=chunk) [Same-Store Operating Expenses - Multifamily](index=22&type=section&id=Same-Store%20Operating%20Expenses%20-%20Multifamily) Total same-store operating expenses increased by **1.2%** year-over-year in Q1 2025, driven by controllable expenses but offset by lower real estate taxes Q1 2025 Same-Store Operating Expense Changes (YoY) (in thousands) | Expense Category | Q1 2025 | % Change vs Q1 2024 | | :--- | :--- | :--- | | Controllable operating expenses | $9,685 | 5.5% | | Real estate taxes | $5,878 | (7.3)% | | Utilities | $3,747 | 4.6% | | Insurance | $1,236 | 3.7% | | **Total same-store operating expenses** | **$20,546** | **1.2%** | [Schedule of Properties](index=23&type=section&id=Schedule%20of%20Properties) Elme's portfolio includes 9,374 multifamily homes with **94.8%** average occupancy and the Watergate 600 office property, which is **82.3%** leased - The total multifamily portfolio comprises **9,374 apartment homes** with an average occupancy of **94.8%** for Q1 2025[65](index=65&type=chunk) - A fire at the Elme Marietta property on March 24, 2024, has left **24 units** unavailable. These units are expected to be back in service by the end of Q4[67](index=67&type=chunk) Office Property - Watergate 600 | Property | Net Rentable SF | Leased % | Ending Occupancy % | % of Total Portfolio NOI | | :--- | :--- | :--- | :--- | :--- | | Watergate 600 | 300,000 | 82.3% | 82.3% | 8% | Capital Analysis [Adjusted EBITDA](index=26&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA for Q1 2025 increased to **$31.3 million**, primarily driven by higher operating income and adjustments for non-operating expenses Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(4,675) | $(3,647) | | Interest expense | 9,460 | 9,494 | | Real estate depreciation and amortization | 23,239 | 24,943 | | Other non-operating expenses | 3,041 | — | | Other adjustments | 199 | (1,299) | | **Adjusted EBITDA** | **$31,264** | **$29,491** | [Long Term Debt Analysis](index=27&type=section&id=Long%20Term%20Debt%20Analysis) As of March 31, 2025, Elme's total unsecured debt was **$705.1 million** with a **4.9%** weighted average interest rate and a well-staggered maturity profile Debt Composition as of March 31, 2025 (in thousands) | Debt Type | Balance Outstanding | Weighted Avg. Interest Rate | | :--- | :--- | :--- | | Fixed rate bonds | $398,212 | 4.5% | | Term loan | $124,849 | 5.8% | | Credit facility | $182,000 | 5.3% | | **Total** | **$705,061** | **4.9%** | Future Debt Maturities (in thousands) | Year | Total Debt | | :--- | :--- | | 2025 | $— | | 2026 | $125,000 | | 2027 | $— | | 2028 | $232,000 | | Thereafter | $350,000 | | **Total** | **$707,000** | - The company is in compliance with all its unsecured public and private debt covenants, with significant headroom on key metrics such as leverage and debt service coverage[84](index=84&type=chunk) [Capitalization and Dividend Payout Ratios](index=30&type=section&id=Capitalization%20and%20Dividend%20Payout%20Ratios) As of March 31, 2025, Elme's total market capitalization was **$2.24 billion**, with a debt to market capitalization ratio of **0.31:1** and a Core FFO dividend payout ratio of **75.0%** Market Capitalization as of March 31, 2025 (in thousands) | Metric | Value | | :--- | :--- | | Equity Market Capitalization | $1,533,932 | | Total Debt | $705,061 | | **Total Market Capitalization** | **$2,238,993** | | Total Debt to Market Capitalization | 0.31 : 1 | Q1 2025 Dividend Payout Ratios | Basis | Payout Ratio | | :--- | :--- | | Payout Ratio (Core FFO basis) | 75.0% | | Payout Ratio (Core AFFO basis) | 75.0% | Definitions [Non-GAAP Financial Measures](index=12&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP measures like NAREIT FFO, Core FFO, AFFO, Core AFFO, NOI, and Adjusted EBITDA to clarify operating performance and dividend capacity - **NAREIT FFO:** Calculated as net income excluding gains/losses from property sales, real estate impairments, and real estate depreciation and amortization[33](index=33&type=chunk) - **Core FFO:** Adjusts NAREIT FFO for items not indicative of operating portfolio performance, such as gains/losses on debt extinguishment, acquisition-related expenses, and costs from the strategic review[32](index=32&type=chunk) - **NOI:** Defined as real estate rental revenue less direct real estate operating expenses, used for assessing property-level performance[35](index=35&type=chunk) [Other Definitions](index=13&type=section&id=Other%20Definitions) Key operational metrics defined include Average Occupancy, Lease Rate Growth, and Same-store Portfolio, providing clarity on performance analysis - **Average Occupancy:** Based on the average daily occupied apartment homes as a percentage of total apartment homes[37](index=37&type=chunk) - **Lease Rate Growth:** The average percentage change in rent for a new or renewed lease compared to the prior lease, with the 'blended' rate being a weighted average of new and renewal growth[41](index=41&type=chunk) - **Same-store Portfolio:** Includes properties owned for the entirety of the years being compared, excluding properties under development, redevelopment, or those recently acquired or sold[45](index=45&type=chunk)

Financial Results - Elme Communities reported a net loss per diluted share of $0.05 for Q1 2025, compared to a loss of $0.04 in Q1 2024 [2][21] - Core FFO per diluted share increased to $0.24 in Q1 2025 from $0.23 in Q1 2024 [2][21] Operational Highlights - Same-store multifamily NOI increased by 5.5% year-over-year, driven by higher rental revenue and successful property tax assessment appeals [7][8] - Average occupancy for the same-store portfolio rose to 94.8%, up 0.5% from the prior year [7][8] - Retention rate during the quarter was 62%, aligning with expectations [7] Balance Sheet - As of March 31, 2025, available liquidity was $324 million, consisting of cash and availability under the revolving credit facility [7] - The annualized Net Debt to Adjusted EBITDA ratio was 5.6x, indicating a strong balance sheet with only $125 million of debt maturing before 2028 [7] Strategic Review - The board of trustees initiated a formal review to evaluate strategic alternatives for maximizing shareholder value, with no set deadline for completion [6] 2025 Guidance - Elme expects Core FFO for 2025 to range from $0.91 to $0.97 per fully diluted share [9][10] - Same-store multifamily revenue growth is projected between 2.1% and 3.6%, with NOI growth expected to be between 1.5% and 3.5% [10] Dividends - Elme Communities paid a quarterly dividend of $0.18 per share on April 3, 2025, and announced another dividend of the same amount to be paid on July 3, 2025 [12]