UDR (NYSE:UDR) 2025 Conference September 09, 2025 03:00 PM ET Company ParticipantsJana Galan - DirectorThomas Toomey - Chairman, President & CEOMichael Lacy - SVP & COODavid Bragg - SVP & CFOChristopher Van Ens - Vice PresidentConference Call ParticipantsNone - AnalystJana GalanGood afternoon, everyone. Welcome to Bank of America's 2025 Global Real Estate Conference. I'm Yana Gallen, and I cover the residential REITs at Bank of America. We're pleased to have with us UDR's President and CEO, Thomas Toomey, C ...

Group 1 - The debt service coverage ratio at Storehouse Lofts was reported at 1.40x in 2024, with an occupancy rate of 87% [3] - The loan for Storehouse Lofts, a 161-unit property in Philadelphia, has been moved to special servicing after a payment default, with $28 million outstanding [6] - Average apartment rents in Philadelphia have increased by $15 year over year, but have recently decreased from a peak of $1,650 in July to $1,615 [4] Group 2 - There has been "constant turnover" at the building's 7,500-square-foot tavern, which has undergone multiple name changes and recently closed in March 2025 [4] - New deliveries in parts of Philadelphia are causing supply issues, as noted by UDR's Chief Operating Officer [5] - The property was previously known as The Fairmount at Brewerytown and was redeveloped by Spain Development Group, which sold it in 2021 [6]

Group 1 - iREIT+HOYA Capital focuses on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The service offers a free two-week trial for potential investors to explore exclusive income-focused portfolios [1] Group 2 - Successful investing is characterized by acquiring good assets at favorable prices rather than merely popular assets [2] - The emphasis is on defensive stocks with a medium- to long-term investment horizon [2]

[PART I — FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section presents UDR, Inc.'s unaudited consolidated financial statements and management's discussion and analysis of financial condition and results of operations [Item 1. Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents UDR, Inc.'s unaudited consolidated financial statements, including the Balance Sheets, Statements of Operations, Comprehensive Income/(Loss), Changes in Equity, and Cash Flows, along with detailed notes explaining the basis of presentation, significant accounting policies, and specific financial line items for the periods ended June 30, 2025 and 2024 [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) This table presents UDR, Inc.'s consolidated financial position at specific dates, detailing assets, liabilities, and equity Consolidated Balance Sheets Summary | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Total assets | $10,647,085 | $10,897,586 | | Total liabilities | $6,363,954 | $6,436,691 | | Total equity | $3,325,151 | $3,443,540 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) This table outlines UDR, Inc.'s financial performance over specific periods, including revenues, operating income, and net income Consolidated Statements of Operations Summary | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Total revenues | $425,399 | $415,320 | $847,347 | $828,954 | | Operating income | $77,389 | $68,666 | $199,584 | $148,425 | | Net income attributable to UDR, Inc. | $37,673 | $28,883 | $114,393 | $72,032 | | Net income attributable to common stockholders | $36,462 | $27,673 | $111,976 | $69,591 | | Diluted EPS | $0.11 | $0.08 | $0.34 | $0.21 | [Consolidated Statements of Comprehensive Income/(Loss)](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%2F%28Loss%29) This table presents UDR, Inc.'s comprehensive income, including net income and other comprehensive income components Consolidated Statements of Comprehensive Income/(Loss) Summary | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Net income/(loss) | $40,229 | $31,013 | $122,300 | $77,323 | | Other comprehensive income/(loss) | $(1,406) | $(1,424) | $(2,665) | $3,246 | | Comprehensive income/(loss) attributable to UDR, Inc. | $36,361 | $27,557 | $111,915 | $75,028 | [Consolidated Statements of Changes in Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Equity) This section details the changes in UDR, Inc.'s equity components over time, reflecting contributions, distributions, and comprehensive income - Total equity decreased from **$3,443,540 thousand** at December 31, 2024, to **$3,325,151 thousand** at June 30, 2025, primarily due to common stock distributions declared[8](index=8&type=chunk)[13](index=13&type=chunk) Consolidated Statements of Changes in Equity Summary | Equity Component | Balance at Dec 31, 2024 (in thousands) | Balance at June 30, 2025 (in thousands) | | :----------------------------------- | :------------------------------------- | :------------------------------------ | | Preferred Stock | $43,193 | $43,193 | | Common Stock | $3,309 | $3,313 | | Additional Paid-in Capital | $7,572,480 | $7,582,852 | | Distributions in Excess of Net Income | $(4,179,415) | $(4,305,702) | | Accumulated Other Comprehensive Income/(Loss), net | $3,638 | $1,160 | | Noncontrolling Interests | $335 | $335 | | Total Equity | $3,443,540 | $3,325,151 | - Common stock distributions declared for the six months ended June 30, 2025, totaled **$(285,014) thousand**, compared to **$(280,077) thousand** for the same period in 2024[13](index=13&type=chunk)[15](index=15&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This table summarizes UDR, Inc.'s cash inflows and outflows from operating, investing, and financing activities Consolidated Statements of Cash Flows Summary | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net cash provided by/(used in) operating activities | $406,545 | $406,061 | | Net cash provided by/(used in) investing activities | $(40,938) | $(79,335) | | Net cash provided by/(used in) financing activities | $(365,925) | $(327,206) | | Net increase/(decrease) in cash, cash equivalents, and restricted cash | $(318) | $(480) | | Cash, cash equivalents, and restricted cash, end of period | $35,109 | $34,386 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and disclosures for the consolidated financial statements, covering the Company's organization, significant accounting policies, real estate assets, debt, equity, and segment information, offering context for the reported financial figures [Note 1. BASIS OF PRESENTATION](index=10&type=section&id=Note%201.%20BASIS%20OF%20PRESENTATION) UDR, Inc. is a self-administered REIT that owns, operates, acquires, renovates, develops, redevelops, and manages apartment communities in targeted U.S. markets. The unaudited interim financial statements are prepared under GAAP, consolidating wholly-owned and controlled subsidiaries, including the Operating Partnership and DownREIT Partnership, where UDR holds significant ownership interests - UDR's consolidated apartment portfolio consists of **168** communities with **55,808** apartment homes across **21** markets as of June 30, 2025[18](index=18&type=chunk) - The Company also holds ownership interests in **10,585** apartment homes through unconsolidated joint ventures or partnerships[18](index=18&type=chunk) - UDR owns **92.8%** of the Operating Partnership units and **71.3%** of the DownREIT Partnership units as of June 30, 2025[20](index=20&type=chunk) [Note 2. SIGNIFICANT ACCOUNTING POLICIES](index=11&type=section&id=Note%202.%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines UDR's key accounting policies, including recent pronouncements, principles of consolidation, real estate sales gain recognition, allowance for credit losses, notes receivable, comprehensive income, income taxes, forward sales agreements, and lease receivables, providing context for how financial transactions are recorded and reported - FASB ASU **2024-03** (Disaggregation of Income Statement Expenses) is effective for the Company for the year ended December 31, 2027[24](index=24&type=chunk) - FASB ASU **2023-09** (Improvements to Income Tax Disclosures) is effective for the Company for the year ended December 31, 2025[25](index=25&type=chunk) - The Company applies the CECL impairment model for financial assets, excluding operating lease receivables[31](index=31&type=chunk) Net Credit Recoveries/(Losses) Data | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Net credit recoveries/(losses) | $0.2 | <$(0.1) | $0.2 | <$(0.1) | Notes Receivable Summary | Notes Receivable, net (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Notes receivable | $144,083 | $286,282 | | Allowance for credit losses | $(591) | $(38,433) | | Total notes receivable, net | $143,492 | $247,849 | - The Company acquired the developer's equity interest in a **478**-apartment home community in Philadelphia in May 2025, leading to consolidation and a **$3.9 million** recognition of previously unaccrued interest and a **$0.3 million** gain on consolidation[36](index=36&type=chunk) [Note 3. REAL ESTATE OWNED](index=19&type=section&id=Note%203.%20REAL%20ESTATE%20OWNED) This note details UDR's real estate assets, including income-producing properties, properties under development, and those held for disposition. It covers changes due to acquisitions and dispositions, and the capitalization of predevelopment, development, and redevelopment costs Real Estate Owned Summary | Real Estate Owned (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Real estate owned | $16,311,298 | $16,213,363 | | Accumulated depreciation | $(7,157,371) | $(6,901,026) | | Real estate owned, net | $9,153,927 | $9,312,337 | - In May 2025, the Company acquired the developer's equity interest in a **478**-apartment home community in Philadelphia, increasing real estate assets by approximately **$166.0 million** and recognizing a **$0.3 million** gain on consolidation[58](index=58&type=chunk) - In January 2025, the Company sold two operating communities (Brooklyn, NY and Englewood, NJ) for gross proceeds of **$211.5 million**, resulting in a total gain of approximately **$47.9 million**[59](index=59&type=chunk)[60](index=60&type=chunk) Capitalized Costs Summary | Capitalized Costs (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Predevelopment, development, and redevelopment costs (excluding direct costs and interest) | $1,400 | $4,400 | $4,000 | $8,600 | | Total capitalized interest | $2,100 | $2,400 | $4,100 | $5,300 | [Note 4. VARIABLE INTEREST ENTITIES](index=20&type=section&id=Note%204.%20VARIABLE%20INTEREST%20ENTITIES) UDR has identified the Operating Partnership and DownREIT Partnership as Variable Interest Entities (VIEs) and consolidates them. This is based on UDR's role as the sole general partner, which grants it the power to direct activities significantly impacting economic performance and the obligation/right to absorb/receive significant benefits - The Operating Partnership and DownREIT Partnership are classified as VIEs because limited partners lack substantive kick-out and participating rights[65](index=65&type=chunk) - UDR consolidates these entities as the primary beneficiary, directing their activities and absorbing/receiving potentially significant losses/benefits[68](index=68&type=chunk) [Note 5. JOINT VENTURES AND PARTNERSHIPS](index=22&type=section&id=Note%205.%20JOINT%20VENTURES%20AND%20PARTNERSHIPS) This note details UDR's investments in unconsolidated joint ventures and partnerships, which are accounted for under the equity method. It summarizes the Company's investment balances, income/losses from these entities, and significant transactions such as new preferred equity investments and repayments Total Investment in and Advances to Unconsolidated Joint Ventures Data | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Total investment in and advances to unconsolidated joint ventures, net | $879,781 | $917,483 | Income/(Loss) from Unconsolidated Entities Data | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :------------------------------------ | :------------------------------------ | :---------------------------------- | :---------------------------------- | | Income/(loss) from unconsolidated entities | $3,629 | $4,046 | $9,443 | $13,131 | | Joint venture management and other fees | $2,398 | $1,992 | $4,510 | $3,957 | - In April 2025, UDR entered a new preferred equity investment of **$13.0 million** in a Daly City, California operating community, earning a **12.0%** preferred return[76](index=76&type=chunk) - In June 2025, the Company received full repayment of its approximately **$54.8 million** preferred equity investment in a Queens, New York community[77](index=77&type=chunk) Combined Unconsolidated Joint Ventures Summary | Combined Unconsolidated JVs (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenues | $93,206 | $78,013 | $183,327 | $154,269 | | Net income/(loss) | $(23,808) | $(17,613) | $(40,705) | $(12,219) | [Note 6. LEASES](index=25&type=section&id=Note%206.%20LEASES) This note details UDR's lease arrangements, both as a lessee (ground leases) and a lessor (apartment, retail, and commercial space). It outlines the carrying amounts of right-of-use assets and lease liabilities, lease terms, discount rates, and future minimum lease payments Lease Metrics Summary | Lease Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Operating lease right-of-use assets | $185,125 | $186,997 | | Operating lease liabilities | $180,433 | $182,275 | - The weighted average remaining lease term for ground leases is **41.1** years, with a weighted average discount rate of **5.0%** as of June 30, 2025[88](index=88&type=chunk) Operating Lease Expense Summary | Operating Lease Expense (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total operating lease expense | $3,416 | $3,393 | $6,829 | $6,783 | - Future minimum lease payments from retail and commercial leases total **$196.2 million**, with apartment home leases generally having initial terms of **12** months or less[92](index=92&type=chunk) [Note 7. SECURED AND UNSECURED DEBT, NET](index=30&type=section&id=Note%207.%20SECURED%20AND%20UNSECURED%20DEBT%2C%20NET) This note provides a comprehensive overview of UDR's secured and unsecured debt, including principal outstanding, interest rates, and maturities. It details various credit facilities, commercial paper programs, and medium-term notes, highlighting the Company's compliance with debt covenants Secured and Unsecured Debt Summary | Debt Category (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total Secured Debt, net | $1,136,046 | $1,139,331 | | Total Unsecured Debt, net | $4,639,537 | $4,687,634 | | Total Debt, net | $5,775,583 | $5,826,965 | - As of June 30, 2025, the weighted average interest rate on total debt was **3.35%**, with a weighted average of **4.7** years to maturity[97](index=97&type=chunk) - Secured debt encumbered approximately **13%** of UDR's total real estate owned as of June 30, 2025[99](index=99&type=chunk) Unsecured Debt Program Summary | Unsecured Debt Program (in thousands) | June 30, 2025 Outstanding | Dec 31, 2024 Outstanding | June 30, 2025 Wtd Avg Rate | Dec 31, 2024 Wtd Avg Rate | | :------------------------------------ | :------------------------ | :----------------------- | :------------------------- | :------------------------ | | Commercial paper program | $220,000 | $289,900 | 4.65% | 5.4% | | Working capital credit facility | $30,215 | $9,361 | 5.17% | 6.0% | - UDR was in compliance with all debt instrument covenants at June 30, 2025[120](index=120&type=chunk) [Note 8. INCOME/(LOSS) PER SHARE](index=37&type=section&id=Note%208.%20INCOME%2F%28LOSS%29%20PER%20SHARE) This note details the calculation of basic and diluted income/(loss) per share for UDR, Inc., including the impact of common shares, OP/DownREIT Units, convertible preferred stock, and other equity instruments. It also mentions the Company's ATM sales agreement for common stock issuance Net Income Attributable to Common Stockholders and EPS | 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 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income/(loss) attributable to common stockholders | $36,462 | $27,673 | $111,976 | $69,591 | | Basic EPS | $0.11 | $0.08 | $0.34 | $0.21 | | Diluted EPS | $0.11 | $0.08 | $0.34 | $0.21 | Weighted Average Shares Outstanding | Shares Outstanding (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Weighted average common shares outstanding (Basic) | 330,778 | 329,056 | 330,703 | 328,940 | | Weighted average common shares outstanding (Diluted) | 331,715 | 329,572 | 331,717 | 329,334 | - As of June 30, 2025, **14.0 million** shares of common stock were available for future issuance under the ATM program[122](index=122&type=chunk) [Note 9. NONCONTROLLING INTERESTS](index=39&type=section&id=Note%209.%20NONCONTROLLING%20INTERESTS) This note explains the accounting for redeemable noncontrolling interests in the Operating Partnership and DownREIT Partnership, which are reported at their redemption value based on UDR's stock price. It also covers non-redeemable noncontrolling interests in other consolidated affiliates Redeemable Noncontrolling Interests Summary | Redeemable Noncontrolling Interests (in thousands) | Amount | | :------------------------------------------------- | :----- | | Redeemable noncontrolling interests at December 31, 2024 | $1,017,355 | | Mark-to-market adjustment | $(46,751) | | Conversion of OP Units/DownREIT Units | $(12,443) | | Net income attributable to redeemable noncontrolling interests | $7,884 | | Distributions to redeemable noncontrolling interests | $(20,888) | | Redeemable Long-Term and Short-Term Incentive Plan Units | $13,010 | | Allocation of other comprehensive income/(loss) | $(187) | | Redeemable noncontrolling interests at June 30, 2025 | $957,980 | - Redeemable noncontrolling interests are recorded outside of permanent equity and reported at their redemption value, based on the Company's stock price at each balance sheet date[128](index=128&type=chunk) [Note 10. FAIR VALUE OF DERIVATIVES AND FINANCIAL INSTRUMENTS](index=40&type=section&id=Note%2010.%20FAIR%20VALUE%20OF%20DERIVATIVES%20AND%20FINANCIAL%20INSTRUMENTS) This note outlines UDR's fair value measurements for financial instruments, categorizing them into a three-level hierarchy (Level 1, 2, 3) based on observability of inputs. It provides fair value estimates for notes receivable, equity securities, derivatives, and debt instruments, explaining the valuation methodologies used Fair Value of Financial Instruments | Financial Instrument (in thousands) | Fair Value at June 30, 2025 | Fair Value at December 31, 2024 | | :---------------------------------- | :-------------------------- | :------------------------------ | | Notes receivable, net (Level 3) | $141,300 | $243,546 | | Equity securities (Level 1) | $725 | $1,281 | | Derivatives - Interest rate contracts (Level 2) | $16 | $3,227 | | Secured debt instruments - fixed rate (Level 3) | $1,057,679 | $1,039,482 | | Unsecured notes (Level 3) | $4,032,636 | $3,897,187 | - Redeemable noncontrolling interests in the Operating Partnership and DownREIT Partnership are classified as Level **2**, as their valuation is based on the fair value of the Company's common stock[142](index=142&type=chunk) - No transfers into or out of any fair value hierarchy levels occurred during the six months ended June 30, 2025[136](index=136&type=chunk) [Note 11. DERIVATIVES AND HEDGING ACTIVITY](index=44&type=section&id=Note%2011.%20DERIVATIVES%20AND%20HEDGING%20ACTIVITY) This note details UDR's use of derivative financial instruments, primarily interest rate swaps and caps, to manage interest rate risk and stabilize interest expense. It outlines the fair value of these instruments and their impact on comprehensive income and interest expense - UDR uses interest rate swaps and caps as cash flow hedges to manage interest rate risk and add stability to interest expense[145](index=145&type=chunk) - As of June 30, 2025, the Company had **3** outstanding interest rate derivatives designated as cash flow hedges, with a total notional value of **$183.977 million**[151](index=151&type=chunk) - An estimated **$0.3 million** will be reclassified as a decrease to Interest expense from Accumulated other comprehensive income/(loss), net through June 30, 2026[150](index=150&type=chunk) Derivative and Hedging Activity Impact | Derivative Impact (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Unrealized holding gain/(loss) recognized in OCI | $(27) | $567 | $81 | $7,232 | | Gain/(Loss) Reclassified from Accumulated OCI into Interest expense | $1,379 | $1,991 | $2,746 | $3,986 | [Note 12. STOCK BASED COMPENSATION](index=48&type=section&id=Note%2012.%20STOCK%20BASED%20COMPENSATION) This note reports the stock-based compensation expense recognized by UDR, inclusive of awards granted to non-employee directors, which is included in General and Administrative expenses Stock Based Compensation Expense | Stock Based Compensation (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Stock based compensation expense | $8,800 | $9,400 | $16,300 | $16,700 | [Note 13. COMMITMENTS AND CONTINGENCIES](index=49&type=section&id=Note%2013.%20COMMITMENTS%20AND%20CONTINGENCIES) This note outlines UDR's financial commitments, primarily for real estate development, and discusses ongoing legal proceedings, including antitrust lawsuits related to revenue management software. The Company believes these legal matters will not have a material adverse effect on its financial condition Real Estate Commitments Summary | Real Estate Commitments (in thousands) | UDR's Investment (June 30, 2025) | UDR's Remaining Commitment | | :------------------------------------- | :------------------------------- | :------------------------- | | Wholly-owned — under development | $41,108 | $92,492 | | Real estate technology and sustainability investments | $128,404 | $40,596 | | Total | $169,512 | $133,088 | - UDR is a defendant in consolidated antitrust lawsuits related to its use of RealPage, Inc.'s revenue management software, with similar allegations filed by the District of Columbia, Maryland, and Washington[162](index=162&type=chunk) - Governmental investigations regarding antitrust matters in the multifamily industry are ongoing, but the Company believes any liability will not have a material adverse effect[162](index=162&type=chunk) [Note 14. REPORTABLE SEGMENTS](index=49&type=section&id=Note%2014.%20REPORTABLE%20SEGMENTS) This note details UDR's two reportable segments: Same-Store Communities and Non-Mature Communities/Other. It provides a breakdown of rental income, operating expenses, and Net Operating Income (NOI) by segment and geographic region, along with a reconciliation of NOI to Net income attributable to UDR, Inc - UDR's two reportable segments are Same-Store Communities and Non-Mature Communities/Other, with performance evaluated based on rental income and Net Operating Income (NOI)[168](index=168&type=chunk)[171](index=171&type=chunk) Segment Rental Income, Operating Expenses, and NOI | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total segment and consolidated rental income | $423,001 | $413,328 | $842,837 | $824,997 | | Total segment and consolidated operating expenses | $132,621 | $129,327 | $267,356 | $261,600 | | Total segment and consolidated NOI | $290,380 | $284,001 | $575,481 | $563,397 | - Same-Store Communities comprised **54,915** apartment homes for the three months ended June 30, 2025, and **54,442** for the six months ended June 30, 2025[178](index=178&type=chunk)[179](index=179&type=chunk) Reportable Apartment Home Segment Assets | Reportable Apartment Home Segment Assets (in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------------------------------ | :------------ | :---------------- | | Total segment assets | $16,311,298 | $16,213,363 | | Total segment assets — net book value | $9,153,927 | $9,312,337 | - Geographic segments include West, Mid-Atlantic, Northeast, Southeast, and Southwest Regions[180](index=180&type=chunk)[184](index=184&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=59&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on UDR's financial condition and operational results, analyzing key trends, liquidity, capital resources, and segment performance. It also includes forward-looking statements, critical accounting policies, and a reconciliation of non-GAAP financial measures like FFO, FFOA, and AFFO [Forward-Looking Statements](index=59&type=section&id=Forward-Looking%20Statements) This section highlights the inherent uncertainties and risks associated with future projections and business outlook - The report contains forward-looking statements regarding property acquisitions, development, capital raising, rent growth, occupancy, and rental expense growth[187](index=187&type=chunk) - Future results could differ materially due to factors such as general market and economic conditions, inflation, competitive factors, debt financing risks, natural disasters, cybersecurity breaches, and changes in laws[188](index=188&type=chunk) - The Company disclaims any obligation to update or revise forward-looking statements[191](index=191&type=chunk) [Business Overview](index=60&type=section&id=Business%20Overview) This section provides a summary of UDR's core business as a REIT, its real estate portfolio, and operational metrics - UDR is a self-administered REIT that owns, operates, acquires, renovates, develops, redevelops, disposes of, and manages multifamily apartment communities in targeted U.S. markets[192](index=192&type=chunk) - As of June 30, 2025, the consolidated real estate portfolio included **168** communities with **55,808** apartment homes[193](index=193&type=chunk) - The Company also has an ownership interest in **10,585** apartment homes through unconsolidated joint ventures or partnerships[193](index=193&type=chunk) Same-Store Communities Key Metrics | Same-Store Communities (June 30, 2025) | Three Months Ended | Six Months Ended | | :--------------------------------------- | :----------------- | :--------------- | | Weighted Average Physical Occupancy | 96.9% | 97.0% | | Monthly Income per Occupied Home | $2,572 | $2,562 | [Liquidity and Capital Resources](index=63&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses UDR's sources of funds, debt facilities, and capital management strategies to meet financial obligations - Primary sources of liquidity include cash flow from operations, property sales, borrowings under credit agreements, and issuance of debt/equity securities[201](index=201&type=chunk) - The Company has a **$1.3 billion** unsecured revolving credit facility (maturing August 31, 2028) and a **$350.0 million** unsecured term loan (maturing January 31, 2027)[206](index=206&type=chunk) - As of June 30, 2025, **$220.0 million** of commercial paper was outstanding (weighted average rate of **4.65%**), leaving **$480.0 million** of unused capacity under the **$700.0 million** program[207](index=207&type=chunk)[209](index=209&type=chunk) - Remaining debt maturities for 2025 include approximately **$175.1 million** of secured debt and **$220.0 million** of unsecured debt (commercial paper)[211](index=211&type=chunk) [Guarantor Subsidiary Summarized Financial Information](index=65&type=section&id=Guarantor%20Subsidiary%20Summarized%20Financial%20Information) This section provides summarized financial data for the Operating Partnership, which guarantees certain of UDR's debt securities - The Operating Partnership fully and unconditionally guarantees payment of principal, premium, and interest for certain of UDR's registered debt securities[215](index=215&type=chunk) Operating Partnership Summarized Financials | Operating Partnership (in thousands) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------ | :---------------- | | Total assets | $2,751,228 | $2,797,868 | | Total liabilities | $2,206,738 | $2,130,698 | | Total capital | $544,490 | $667,170 | Operating Partnership Net Income Data | Operating Partnership Net Income (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income/(loss) | $23,833 | $18,872 | $48,375 | $37,499 | [Critical Accounting Policies and Estimates and New Accounting Pronouncements](index=67&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates%20and%20New%20Accounting%20Pronouncements) This section outlines key accounting judgments and assumptions, along with the impact of recently adopted or issued accounting standards - Critical accounting policies include capital expenditures, impairment of long-lived assets, real estate investment properties, and revenue recognition[219](index=219&type=chunk) - No significant changes in critical accounting policies from the Annual Report on Form 10-K filed February 18, 2025[220](index=220&type=chunk) [Statements of Cash Flows Analysis](index=67&type=section&id=Statements%20of%20Cash%20Flows%20Analysis) This section analyzes UDR's cash flow trends from operating, investing, and financing activities over specified periods Cash Flow Activities Summary | Cash Flow Activity (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $406,545 | $406,061 | | Net cash used in investing activities | $(40,938) | $(79,335) | | Net cash used in financing activities | $(365,925) | $(327,206) | - The decrease in cash used in investing activities was primarily due to increased proceeds from real estate sales (**$203.6 million** in H1 2025 vs **$98.7 million** in H1 2024) and decreased development spend[17](index=17&type=chunk)[224](index=224&type=chunk) - Total capital expenditures for the six months ended June 30, 2025, were **$119.9 million**, a **2.8%** decrease from **$123.4 million** in the comparable 2024 period[227](index=227&type=chunk)[231](index=231&type=chunk) - Significant financing activities included repaying **$69.9 million** (net) on the unsecured commercial paper program and paying **$283.2 million** in distributions to common stockholders[245](index=245&type=chunk) [Results of Operations Analysis](index=74&type=section&id=Results%20of%20Operations%20Analysis) This section provides a detailed analysis of UDR's financial performance, including revenue drivers, expense trends, and segment contributions Net Income Attributable to Common Stockholders and Total Property NOI | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income attributable to common stockholders | $36,462 | $27,673 | $111,976 | $69,591 | | Total property NOI | $290,380 | $284,001 | $575,481 | $563,397 | - Same-Store NOI increased by **2.9%** (**$7.9 million**) for Q2 2025 and **2.6%** (**$14.2 million**) for H1 2025, driven by higher rental income and partially offset by increased operating expenses[261](index=261&type=chunk)[264](index=264&type=chunk) - Non-Mature Communities/Other NOI decreased by **17.6%** (**$1.5 million**) for Q2 2025 and **10.1%** (**$2.1 million**) for H1 2025, primarily due to the sale of two operating communities[268](index=268&type=chunk)[269](index=269&type=chunk) - Gain on sale of real estate owned for H1 2025 was **$47.9 million**, significantly higher than **$16.9 million** in H1 2024, due to the sale of two communities[270](index=270&type=chunk) - Other depreciation and amortization increased by **$5.5 million** for H1 2025, primarily due to **$5.9 million** in software transition-related costs[276](index=276&type=chunk)[277](index=277&type=chunk) [Funds from Operations, Funds from Operations as Adjusted, and Adjusted Funds from Operations](index=82&type=section&id=Funds%20from%20Operations%2C%20Funds%20from%20Operations%20as%20Adjusted%2C%20and%20Adjusted%20Funds%20from%20Operations) This section reconciles and presents key non-GAAP financial measures used to evaluate REIT performance, including FFO, FFOA, and AFFO Funds from Operations (FFO, FFOA, AFFO) Summary | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | FFO attributable to common stockholders and unitholders, diluted | $216,592 | $215,729 | $424,884 | $429,184 | | FFOA attributable to common stockholders and unitholders, diluted | $227,543 | $221,124 | $446,614 | $438,820 | | AFFO attributable to common stockholders and unitholders, diluted | $198,342 | $194,834 | $399,008 | $395,222 | Funds from Operations Per Share/Unit | Per Share/Unit (Diluted) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | FFO | $0.61 | $0.60 | $1.19 | $1.20 | | FFOA | $0.64 | $0.62 | $1.25 | $1.23 | | AFFO | $0.56 | $0.55 | $1.12 | $1.11 | [Supplemental U.S. Federal Income Tax Considerations](index=86&type=section&id=Supplemental%20U.S.%20Federal%20Income%20Tax%20Considerations) This section outlines recent legislative changes impacting UDR's federal income tax status and REIT compliance - The 'One Big Beautiful Bill Act' (OBBB), enacted July 4, 2025, introduces changes to the Code affecting REITs[292](index=292&type=chunk) - For taxable years beginning on or after January 1, 2026, the REIT asset test requirement for taxable REIT subsidiaries (TRS) is relaxed from **20%** to **25%** of gross asset value[294](index=294&type=chunk) - The Section 199A pass-through qualified business income deduction (**20%** of qualified REIT dividends) has been permanently extended[294](index=294&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=86&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) UDR is exposed to interest rate risk from variable rate debt and refinancing risk on fixed-rate debt, which it manages using derivative financial instruments. The Company's market risk profile has not materially changed since its Annual Report on Form 10-K for the year ended December 31, 2024 - The Company is exposed to interest rate risk associated with variable rate notes payable and maturing debt that needs refinancing[293](index=293&type=chunk) - As of June 30, 2025, UDR had **$452.2 million** in variable rate debt not subject to interest rate swap contracts[246](index=246&type=chunk) - A hypothetical **100** basis point increase in market interest rates would increase interest expense for the six months ended June 30, 2025, by **$2.6 million**[246](index=246&type=chunk) - The Company uses derivative financial instruments, primarily cash flow hedges, to manage interest rate risk[248](index=248&type=chunk) - Market risk has not materially changed from the amounts reported in the Annual Report on Form 10-K for the year ended December 31, 2024[295](index=295&type=chunk) [Item 4. Controls and Procedures](index=88&type=section&id=Item%204.%20Controls%20and%20Procedures) UDR's management, including the CEO and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures as of June 30, 2025, concluding they are effective at a reasonable assurance level. No material changes in internal control over financial reporting occurred during the fiscal quarter - The Company's disclosure controls and procedures were evaluated and deemed effective at a reasonable assurance level as of June 30, 2025[298](index=298&type=chunk) - There have been no material changes in the Company's internal control over financial reporting during the fiscal quarter ended June 30, 2025[299](index=299&type=chunk) [PART II — OTHER INFORMATION](index=89&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section provides additional information on legal proceedings, risk factors, equity sales, and other disclosures not covered in the financial statements [Item 1. Legal Proceedings](index=89&type=section&id=Item%201.%20Legal%20Proceedings) UDR is involved in various legal proceedings and claims, including antitrust lawsuits related to its use of RealPage, Inc.'s revenue management software. While the Company intends to vigorously defend these suits, the outcome and potential loss cannot be predicted at this early stage, and no liability has been recorded as of June 30, 2025 - UDR is a defendant in consolidated antitrust lawsuits related to its use of RealPage, Inc.'s revenue management software, with similar allegations filed by the District of Columbia, Maryland, and Washington[162](index=162&type=chunk)[302](index=302&type=chunk) - The Company believes there are factual and legal defenses and intends to vigorously defend these suits[162](index=162&type=chunk) - As of June 30, 2025, it is not possible to predict the outcome or estimate the amount of loss, if any, and no liability has been recorded[162](index=162&type=chunk) [Item 1A. Risk Factors](index=89&type=section&id=Item%201A.%20Risk%20Factors) This section details numerous factors that could materially and adversely affect UDR's business, financial condition, and results of operations. Key risks include unfavorable market and economic conditions, geographic concentration, competition, inflation, development and construction challenges, joint venture complexities, insurance limitations, regulatory changes (including rent control), litigation, and financial market disruptions - Unfavorable apartment market and economic conditions, such as increased supply, job losses, or recession, could adversely affect occupancy levels, rental rates, and property values[304](index=304&type=chunk) - Approximately **73.6%** of UDR's total NOI for the six months ended June 30, 2025, was generated from **eight** major geographic markets, increasing exposure to regional economic or regulatory downturns[305](index=305&type=chunk) - Development and construction activities are subject to risks including financing difficulties, supply chain constraints, permitting delays, cost overruns, and failure to achieve anticipated yields[315](index=315&type=chunk) - Property ownership through partnerships and joint ventures may limit UDR's ability to act exclusively in its own interest, and partners may fail to perform as expected, requiring additional capital contributions[320](index=320&type=chunk) - The adoption of, or changes to, rent control, rent stabilization, eviction, and tenants' rights laws could limit UDR's ability to raise rents or charge fees, adversely affecting results of operations and property values[337](index=337&type=chunk) - Changing interest rates could increase interest costs on variable rate debt and refinancing, adversely affecting cash flows and the market price of common stock[366](index=366&type=chunk) - Failure to qualify as a REIT would subject UDR to federal income tax at corporate rates and eliminate dividend deductions, significantly impacting financial condition and stock value[380](index=380&type=chunk)[381](index=381&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=123&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the second quarter of 2025, UDR issued **1,838** shares of common stock in exchange for Operating Partnership units tendered for redemption. The Company did not repurchase any shares under its publicly announced share repurchase program, but did repurchase a small number of shares from employees to satisfy tax obligations related to restricted stock vesting - During the three months ended June 30, 2025, UDR issued **1,838** shares of common stock upon redemption of OP Units[403](index=403&type=chunk) - No shares were repurchased under the **15 million** share repurchase program during the three months ended June 30, 2025[404](index=404&type=chunk) - Less than **1 thousand** shares were repurchased from employees at an average price of **$40.45** per share to satisfy statutory minimum tax obligations related to restricted stock vesting[405](index=405&type=chunk) [Item 3. Defaults Upon Senior Securities](index=125&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The Company reported no defaults upon senior securities for the period - No defaults upon senior securities were reported[406](index=406&type=chunk) [Item 4. Mine Safety Disclosures](index=125&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to UDR, Inc.'s operations - Mine Safety Disclosures are not applicable to the Company[407](index=407&type=chunk) [Item 5. Other Information](index=125&type=section&id=Item%205.%20Other%20Information) During the three months ended June 30, 2025, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement" - No director or officer adopted or terminated a Rule **10b5-1** or non-Rule **10b5-1** trading arrangement during the three months ended June 30, 2025[408](index=408&type=chunk) [Item 6. Exhibits](index=126&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the 10-Q report, including corporate organizational documents, certifications from the CEO and CFO, and Inline XBRL data - Exhibits include Articles of Restatement, Articles of Amendment, Amended and Restated Bylaws, List of Guarantor Subsidiaries, Rule **13a-14(a)** Certifications (CEO, CFO), Section **1350** Certifications (CEO, CFO), and Inline XBRL data[409](index=409&type=chunk) [Signatures](index=127&type=section&id=Signatures) The report is officially signed by the Company's Senior Vice President and Chief Financial Officer - The report was signed by David D. Bragg, Senior Vice President and Chief Financial Officer, on July 31, 2025[411](index=411&type=chunk)

Financial Data and Key Metrics Changes - UDR's second quarter FFOA per share was $0.64, exceeding the high end of previously provided guidance, reflecting a $0.03 or 5% sequential increase driven by higher same store NOI and lower expense growth [22][23] - The company raised its full year 2025 FFOA per share guidance range to $2.49 to $2.55, with a midpoint of $2.52 representing a $0.02 per share improvement compared to prior guidance [23][24] - Same store revenue and NOI growth for the second quarter were 2.5% and 2.9% respectively, better than expected [11][20] Business Line Data and Key Metrics Changes - Same store revenue growth guidance for 2025 was raised to a new range of 1.75% to 3.25%, with a midpoint increase of 25 basis points [14][16] - Annualized resident turnover was reported at 4.2%, significantly better than the prior year and the historical average [12][20] - Income growth from rentable items was 10%, driven by continued innovation and value-added services [12][20] Market Data and Key Metrics Changes - Coastal markets showed strong performance with a second quarter weighted average occupancy of 97.2% and blended lease rate growth of 4% [17][18] - The West Coast demonstrated the strongest momentum with a second quarter weighted average occupancy of 96.9% and blended lease rate growth of 4.2% [18][19] - Sunbelt markets lagged behind with a second quarter weighted average occupancy of 96.7% and slightly negative year-to-date same store revenue growth [20][21] Company Strategy and Development Direction - UDR's strategy focuses on enhancing customer experience, driving innovation, and capital deployment to drive earnings accretion [7][8] - The company aims to leverage its investment-grade balance sheet and substantial liquidity to fund capital needs and pursue attractive investment opportunities [8][25] - UDR remains optimistic about the long-term prospects for the apartment industry, citing favorable supply and demand dynamics [10][21] Management's Comments on Operating Environment and Future Outlook - Management noted that employment and income growth in 2025 exceeded expectations, leading to healthy demand for apartments and record high absorption [5][21] - The company expressed confidence in its ability to drive revenue growth through strategic initiatives and operational excellence [10][21] - Management acknowledged the challenges in the Sunbelt markets but anticipated a return of pricing power as supply pressures decrease [19][21] Other Important Information - UDR was named a top workplace winner in the real estate industry for the second consecutive year, reflecting its strong corporate culture [8] - The company recently appointed Dave Bragg as the new Chief Financial Officer, bringing extensive industry experience [9] Q&A Session Summary Question: Can you elaborate on the blended lease assumption for the second half of the year? - Management indicated that the guidance raise was based on strong execution and that they expect renewal growth to be in the 4% to 4.5% range for the back half of the year, slightly lower than previous months [28][30] Question: Which market's expectations have changed the most? - The West Coast has performed better than expected, while the Sunbelt has not met initial expectations but is showing signs of improvement [39][40] Question: What opportunities are being seen on the external growth front? - The transaction market remains healthy, with UDR focusing on joint venture acquisitions and selective recapitalizations [44][49] Question: How is the company planning to fund upcoming debt maturities? - UDR plans to refinance upcoming debt and maintain its commercial paper program, ensuring liquidity remains strong [50][51] Question: Can you provide insights on the Philadelphia property acquisition? - The acquisition of the Philadelphia property has resulted in improved occupancy from 83% to 97% in a short period, indicating effective management [60][61]

Financial Data and Key Metrics Changes - UDR's second quarter FFOA per share was $0.64, exceeding the high end of previously provided guidance, reflecting a $0.03 or 5% sequential increase driven by higher same store NOI and lower expense growth [23][24] - The full year 2025 FFOA per share guidance range was raised to $2.49 to $2.55, with a midpoint of $2.52 representing a $0.02 per share improvement compared to prior guidance [24] Business Line Data and Key Metrics Changes - Second quarter same store revenue and NOI growth were 2.5% and 2.9% respectively, driven by a 2.8% blended lease rate growth, with renewal rate growth of 5% and new lease rate growth of 30 basis points [11][12] - Year over year same store expense growth was only 1.7%, significantly better than expectations, primarily due to favorable real estate taxes and insurance savings [13][16] Market Data and Key Metrics Changes - Coastal markets exceeded expectations with a second quarter weighted average occupancy of 97.2% and blended lease rate growth of 4% [17] - The West Coast demonstrated strong momentum with a second quarter weighted average occupancy of 96.9% and blended lease rate growth leading all regions at 4.2% [18] - Sunbelt markets lagged behind coastal markets, with a second quarter weighted average occupancy of 96.7% and slightly negative year-to-date same store revenue growth [20] Company Strategy and Development Direction - UDR's strategy focuses on enhancing customer experience, driving innovation, and deploying capital for earnings accretion, supported by a strong investment-grade balance sheet [6][7][9] - The company aims to leverage favorable supply and demand dynamics in the housing market to enhance growth prospects [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term prospects for the apartment industry, citing favorable job and wage growth supporting strong demand for apartments [21] - The company noted that elevated homeownership costs and housing undersupply in the U.S. should bode well for occupancy and pricing going forward [21] Other Important Information - UDR was named a top workplace winner in the real estate industry for the second consecutive year, reflecting its strong corporate culture [8] - The company has a robust pipeline of current and future initiatives expected to drive attractive growth for many years [7] Q&A Session Summary Question: Can you elaborate on the blended lease assumption for the back half of the year? - Management indicated that the guidance raise was due to strong execution and that they expect renewal growth to be in the 4% to 4.5% range for the back half of the year, slightly lower than previous months [30][34] Question: Which market's expectations have changed the most? - The West Coast has performed better than expected, while the Sunbelt has not met initial expectations but is showing signs of improvement [39][40] Question: What opportunities are being seen on the external growth front? - The transaction market remains healthy, with a focus on joint venture acquisitions and selective recapitalizations, while the development side is slower due to high construction costs [46][50] Question: Can you provide insights on the Philadelphia property acquisition? - The acquisition of the Philadelphia property was initially a drag on guidance, but the developer's repayment of interest has offset some of that impact [57][59] Question: What are the trends in the D.C. market? - D.C. remains a strong market with a 4.9% revenue growth during the quarter, maintaining high occupancy and consistent blended lease rates [68][70]

Core Insights - UDR Inc. reported second-quarter 2025 funds from operations as adjusted (FFOA) per share of 64 cents, exceeding the Zacks Consensus Estimate of 62 cents and up from 62 cents in the prior-year quarter [1][8] - The company experienced year-over-year growth in same-store net operating income (NOI) driven by higher effective blended lease rates and raised its 2025 FFOA per share guidance [1][8] Financial Performance - Quarterly revenues from rental income reached $423.0 million, surpassing the Zacks Consensus Estimate of $422.2 million, with total revenues at $425.4 million, both showing over 2% growth year-over-year [2] - Same-store revenues increased by 2.5% year-over-year, while same-store expenses rose by 1.7%, leading to a 2.9% improvement in same-store NOI [3][8] - The effective blended lease rate grew by 2.8% during the quarter, with a weighted average same-store physical occupancy of 96.9%, which increased by 10 basis points year-over-year [3] Balance Sheet and Liquidity - As of June 30, 2025, UDR had $1.1 billion in liquidity, with total debt at $5.8 billion, of which only $531.8 million (9.6%) is maturing through 2026 [4] - The net debt-to-EBITDA ratio improved to 5.5X in the second quarter, down from 5.7X in the previous quarter [4] Portfolio Activity - UDR acquired the developer's equity interest in Broadridge, a 478-unit apartment community in Philadelphia, PA, during the second quarter [6] Guidance - The company raised its full-year 2025 FFOA per share guidance midpoint to $2.52 from $2.50, with expectations for third-quarter 2025 FFOA per share in the range of 62-64 cents [7][9] - For 2025, UDR projects same-store revenue growth rates between 1.75-3.25%, same-store expenses between 2.50% and 3.50%, and same-store NOI between 1.50% and 3.00% [9]

Core Insights - UDR reported revenue of $423 million for the quarter ended June 2025, reflecting a 2.3% increase year-over-year and a slight surprise of +0.18% over the Zacks Consensus Estimate of $422.24 million [1] - The earnings per share (EPS) for the quarter was $0.64, significantly higher than $0.08 in the same quarter last year, with an EPS surprise of +3.23% compared to the consensus estimate of $0.62 [1] Financial Performance Metrics - Weighted Average Physical Occupancy was reported at 96.7%, slightly below the average estimate of 96.9% from four analysts [4] - Rental income was $423 million, exceeding the average estimate of $422.15 million from seven analysts, marking a year-over-year increase of +2.3% [4] - Joint venture management and other fees amounted to $2.4 million, surpassing the average estimate of $2.16 million from six analysts, representing a significant year-over-year increase of +20.4% [4] - Net Earnings Per Share (Diluted) was reported at $0.11, slightly below the average estimate of $0.12 from seven analysts [4] Stock Performance - UDR shares have returned -0.6% over the past month, contrasting with the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Group 1 - UDR reported quarterly funds from operations (FFO) of $0.64 per share, exceeding the Zacks Consensus Estimate of $0.62 per share, and up from $0.62 per share a year ago, representing an FFO surprise of +3.23% [1] - The company posted revenues of $423 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.18%, compared to year-ago revenues of $413.33 million [2] - UDR has surpassed consensus revenue estimates two times over the last four quarters [2] Group 2 - The stock's immediate price movement will depend on management's commentary on the earnings call and future FFO expectations [3] - UDR shares have declined approximately 6.5% since the beginning of the year, while the S&P 500 has gained 8.3% [3] - The current consensus FFO estimate for the coming quarter is $0.63 on revenues of $426.95 million, and for the current fiscal year, it is $2.50 on revenues of $1.7 billion [7] Group 3 - The Zacks Industry Rank for REIT and Equity Trust - Residential is currently in the top 35% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] - Empirical research shows a strong correlation between near-term stock movements and trends in estimate revisions, which can be tracked by investors [5] - The estimate revisions trend for UDR was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it will perform in line with the market in the near future [6]

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Key Financial and Operating Metrics](index=1&type=section&id=Key%20Financial%20and%20Operating%20Metrics) UDR, Inc. achieved solid financial and operational performance in Q2 2025, with diluted FFO per share of $0.61 and FFO as Adjusted of $0.64, alongside updated full-year guidance Q2 2025 and Full-Year 2025 Financial Highlights | Metric | 2Q 2025 Actual Results | YTD 2025 Actual Results | 3Q 2025 Guidance | Full-Year 2025 Guidance | | :----------------------------------- | :---------------- | :---------------- | :---------------- | :---------------- | | **GAAP Metrics** | | | | | | Net Income/(Loss) Attributable to UDR, Inc. (Thousand USD) | $37,673 | $114,393 | -- | -- | | Net Income/(Loss) Attributable to Common Stockholders (Thousand USD) | $36,462 | $111,976 | -- | -- | | Diluted Earnings/(Loss) Per Share ($) | $0.11 | $0.34 | $0.11 to $0.13 | $0.53 to $0.59 | | **Per Share Metrics** | | | | | | Diluted FFO Per Share ($) | $0.61 | $1.19 | $0.61 to $0.63 | $2.42 to $2.48 | | Diluted FFO as Adjusted Per Share ($) | $0.64 | $1.25 | $0.62 to $0.64 | $2.49 to $2.55 | | Dividend Per Share ($) | $0.43 | $0.86 | $0.43 | $1.72 (2) | | **Same-Store Operating Metrics** | | | | | | Revenue Growth/(Decline) (Straight-Line) (%) | 2.5% | 2.5% | -- | 1.75% to 3.25% | | Expense Growth (%) | 1.7% | 2.4% | -- | 2.50% to 3.50% | | NOI Growth/(Decline) (Straight-Line) (%) | 2.9% | 2.6% | -- | 1.50% to 3.00% | | Physical Occupancy (%) | 96.9% | 97.1% | -- | -- | | **Balance Sheet Metrics** | 2Q 2025 | 2Q 2024 | | | | Consolidated Interest Coverage (x) | 5.2x | 5.1x | | | | Consolidated Fixed Charge Coverage (x) | 5.1x | 5.0x | | | | Consolidated Debt as a Percentage of Total Assets (%) | 32.4% | 32.7% | | | | Consolidated Net Debt to EBITDAre Ratio (x) | 5.5x | 5.7x | | | - The company owned **60,535 homes** and **187 communities** at the end of Q2 2025, with same-store communities accounting for **92.6% of total NOI**[2](index=2&type=chunk) [Consolidated Financial Statements](index=2&type=section&id=Consolidated%20Financial%20Statements) [Consolidated Statements of Operations](index=2&type=section&id=Attachment%201%20Consolidated%20Statements%20of%20Operations) In Q2 2025, UDR, Inc.'s total revenue increased by 2.4% year-over-year to $425.4 million, primarily driven by rental income growth, leading to a 12.7% increase in operating income Consolidated Statements of Operations Key Data (Q2 and H1 2025) | Metric (Thousand USD) | 2Q 2025 | 2Q 2024 | H1 2025 | H1 2024 | | :----------------------------------- | :------------- | :------------- | :----------- | :----------- | | Rental Income | $423,001 | $413,328 | $842,837 | $824,997 | | Total Revenue | $425,399 | $415,320 | $847,347 | $828,954 | | Total Operating Expenses | $348,010 | $346,654 | $695,702 | $697,396 | | Operating Income | $77,389 | $68,666 | $199,584 | $148,425 | | Net Income Attributable to UDR, Inc. | $37,673 | $28,883 | $114,393 | $72,032 | | Net Income Attributable to Common Stockholders | $36,462 | $27,673 | $111,976 | $69,591 | | Diluted Earnings Per Share ($) | $0.11 | $0.08 | $0.34 | $0.21 | | Common Stock Dividend Per Share ($) | $0.43 | $0.425 | $0.86 | $0.850 | - In H1 2025, the company's gain on real estate sales was **$47.9 million**, significantly increasing operating income compared to **$16.9 million** in H1 2024[6](index=6&type=chunk) [Funds From Operations (FFO)](index=3&type=section&id=Funds%20From%20Operations%20(FFO)) [Funds From Operations, FFO as Adjusted, and Available for Distribution FFO](index=3&type=section&id=Attachment%202%20Funds%20From%20Operations) In Q2 2025, diluted FFO per share was $0.61, flat year-over-year, while diluted FFO as Adjusted per share was $0.64, primarily impacted by increased legal, software conversion, and disaster-related costs FFO, FFO as Adjusted, and AFFO Key Data (Q2 and H1 2025) | Metric (Thousand USD) | 2Q 2025 | 2Q 2024 | H1 2025 | H1 2024 | | :------------------------------------------------- | :------------- | :------------- | :----------- | :----------- | | FFO Attributable to Common Stockholders and Unit Holders, Diluted | $216,592 | $215,729 | $424,884 | $429,184 | | Diluted FFO Per Share ($) | $0.61 | $0.60 | $1.19 | $1.20 | | Total Impact of Adjustments to FFO | $10,951 | $5,395 | $21,730 | $9,636 | | FFO as Adjusted Attributable to Common Stockholders and Unit Holders, Diluted | $227,543 | $221,124 | $446,614 | $438,820 | | Diluted FFO as Adjusted Per Share ($) | $0.64 | $0.62 | $1.25 | $1.23 | | Recurring Capital Expenditures (Thousand USD) | ($29,201) | ($26,290) | ($47,606) | ($43,598) | | AFFO Attributable to Common Stockholders and Unit Holders, Diluted | $198,342 | $194,834 | $399,008 | $395,222 | | Diluted AFFO Per Share ($) | $0.56 | $0.55 | $1.12 | $1.11 | - In Q2 2025, legal and other costs (**$3.36 million**), software conversion-related costs (**$2.97 million**), and disaster-related expenses (**$3.38 million**) were the primary adjustments to FFO as Adjusted, totaling **$10.95 million**, a significant increase from the prior year[9](index=9&type=chunk) [Balance Sheet & Debt Metrics](index=4&type=section&id=Balance%20Sheet%20%26%20Debt%20Metrics) [Consolidated Balance Sheets](index=4&type=section&id=Attachment%203%20Consolidated%20Balance%20Sheets) As of June 30, 2025, UDR, Inc.'s total assets were $10.65 billion, a slight decrease from $10.90 billion at year-end 2024, with net real estate investments at $9.11 billion Consolidated Balance Sheets Key Data (As of June 30, 2025) | Metric (Thousand USD) | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :------------- | :------------- | | Net Real Estate Investments | $9,112,819 | $9,157,874 | | Real Estate Under Development | $41,108 | $0 | | Real Estate Held for Disposition | $0 | $154,463 | | Total Net Real Estate | $9,153,927 | $9,312,337 | | Cash and Cash Equivalents | $1,532 | $1,326 | | Net Investments and Advances in Unconsolidated Joint Ventures | $879,781 | $917,483 | | Total Assets | $10,647,085 | $10,897,586 | | Secured Debt | $1,136,046 | $1,139,331 | | Unsecured Debt | $4,639,537 | $4,687,634 | | Total Liabilities | $6,363,954 | $6,436,691 | | Equity Attributable to UDR, Inc. Stockholders | $3,324,816 | $3,443,205 | | Total Equity | $3,325,151 | $3,443,540 | [Common Stock and Equivalents](index=5&type=section&id=Attachment%204(A)%20Selected%20Financial%20Information) As of June 30, 2025, the total number of common shares and equivalents was 357,350,864, with diluted weighted average common shares increasing in both Q2 and H1 2025 Common Stock and Equivalents Outstanding | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------------- | :------------- | :------------- | | Common Stock | 331,291,669 | 330,858,719 | | Operating and DownREIT Partnership Units | 22,864,543 | 22,689,109 | | Series E Cumulative Convertible Preferred Stock (Convertible to Common Stock) | 2,815,608 | 2,815,608 | | Total Common Stock, OP/DownREIT Units, and Common Stock Equivalents | 357,350,864 | 357,407,004 | | **Weighted Average Shares** | **2Q 2025** | **2Q 2024** | | Diluted Weighted Average Common Shares (Consolidated Statements of Operations) | 331,714,889 | 329,571,646 | | **Weighted Average Shares** | **YTD 2025** | **YTD 2024** | | Diluted Weighted Average Common Shares (Consolidated Statements of Operations) | 331,716,503 | 329,333,652 | [Debt Structure and Maturities](index=6&type=section&id=Attachment%204(B)%20Selected%20Financial%20Information) As of June 30, 2025, UDR's total debt was $5.79 billion, with 92.2% at fixed rates, a weighted average interest rate of 3.30%, and a weighted average maturity of 4.7 years Debt Structure Overview (As of June 30, 2025) | Debt Type | Balance (Thousand USD) | Percentage of Total Debt (%) | Weighted Average Interest Rate (%) | Weighted Average Maturity (Years) | | :---------------- | :------------- | :------------- | :------------- | :------------- | | Secured Fixed Rate | $1,112,566 | 19.2% | 3.49% | 3.5 | | Secured Variable Rate | $27,000 | 0.5% | 3.02% | 6.7 | | Unsecured Fixed Rate | $4,225,000 | 73.0% | 3.08% | 5.4 | | Unsecured Variable Rate | $425,215 | 7.3% | 4.93% | 0.7 | | **Total Debt** | **$5,789,781** | **100.0%** | **3.30%** | **4.7** | | **Debt Maturities (Thousand USD)** | | | | | | 2025 | $395,091 | 6.8% | 4.22% | | | 2026 | $386,887 | 6.7% | 3.18% | | | 2027 | $656,939 | 11.3% | 3.66% | | | 2028 | $466,526 | 8.1% | 3.72% | | | 2029 | $615,811 | 10.6% | 3.93% | | | 2030 | $830,597 | 14.4% | 3.34% | | | 2031 | $760,930 | 13.1% | 2.92% | | | 2032 | $427,000 | 7.4% | 2.16% | | | 2033 | $650,000 | 11.2% | 1.99% | | | 2034 | $600,000 | 10.4% | 4.04% | | - As of June 30, 2025, the company's **$1.3 billion** revolving credit facility had no outstanding borrowings, maturing in August 2028 with two six-month extension options[23](index=23&type=chunk) [Coverage Ratios and Debt Covenants](index=7&type=section&id=Attachment%204(C)%20Selected%20Financial%20Information) UDR maintained strong debt coverage ratios and good compliance with debt covenants in Q2 2025, with an adjusted consolidated interest coverage of 5.2x and net debt to EBITDAre ratio of 5.5x Debt Coverage Ratios and Covenant Compliance (Q2 2025) | Metric | 2Q 2025 | | :----------------------------------- | :------------- | | EBITDAre (Thousand USD) | $277,490 | | Adjusted Consolidated EBITDAre (Thousand USD) | $262,761 | | Annualized Adjusted Consolidated EBITDAre (Thousand USD) | $1,051,044 | | Total Interest (Thousand USD) | $50,733 | | Net Debt (Thousand USD) | $5,774,051 | | **Adjusted Consolidated Interest Coverage (x)** | **5.2x** | | **Adjusted Consolidated Fixed Charge Coverage (x)** | **5.1x** | | **Adjusted Consolidated Net Debt to EBITDAre Ratio (x)** | **5.5x** | | **Unsecured Credit Facility Covenants** | **Required** | **Actual** | **Compliant** | | Maximum Leverage Ratio (%) | ≤60.0% | 31.0% | Yes | | Minimum Fixed Charge Coverage (x) | ≥1.5x | 4.8x | Yes | | Maximum Secured Debt Ratio (%) | ≤40.0% | 9.7% | Yes | | Minimum Unencumbered Pool Leverage Ratio (%) | ≥150.0% | 378.8% | Yes | | **Senior Unsecured Notes Covenants** | **Required** | **Actual** | **Compliant** | | Debt as a Percentage of Total Assets (%) | ≤65.0% | 32.5% | Yes | | Consolidated Income Available for Debt Service to Annual Debt Service Ratio (x) | ≥1.5x | 5.7x | Yes | | Secured Debt as a Percentage of Total Assets (%) | ≤40.0% | 6.4% | Yes | | Total Unencumbered Assets to Unsecured Debt Ratio (%) | ≥150.0% | 320.0% | Yes | | **Securities Ratings** | **Debt** | **Outlook** | **Commercial Paper** | | Moody's Investors Service | Baa1 | Stable | P-2 | | S&P Global Ratings | BBB+ | Stable | A-2 | - As of Q2 2025, the company's unencumbered assets totaled **$14.27 billion**, representing **87.5%** of total book value assets, demonstrating strong asset liquidity and financial flexibility[26](index=26&type=chunk) [Operating Performance](index=8&type=section&id=Operating%20Performance) [Overall Operating Information](index=8&type=section&id=Attachment%205%20Operating%20Information) In Q2 2025, UDR's total revenue reached $423.0 million, with total Net Operating Income (NOI) of $290.4 million, reflecting stable operational efficiency and high occupancy levels Overall Operating Information (Q2 2025) | Metric (Thousand USD) | 2Q 2025 | | :----------------------------------- | :------------- | | Total Revenue | $423,001 | | Same-Store Community Revenue | $410,518 | | Total Expenses | $132,621 | | Same-Store Community Expenses | $127,163 | | Total Net Operating Income (NOI) | $290,380 | | Same-Store Community NOI | $283,355 | | Same-Store Community Operating Margin (%) | 69.0% | | Same-Store Community Weighted Average Physical Occupancy (%) | 96.9% | | Total Weighted Average Physical Occupancy (%) | 96.7% | - Occupancy in stabilized but non-mature communities significantly increased from **26.9%** in Q2 2024 to **94.5%** in Q2 2025, indicating strong leasing performance in newly developed or recently stabilized communities[30](index=30&type=chunk) [Same-Store Operating Expense Information](index=9&type=section&id=Attachment%206%20Same-Store%20Operating%20Expense%20Information) In Q2 2025, same-store operating expenses increased by 1.7% year-over-year to $127.2 million, driven by higher personnel, repair, maintenance, and administrative costs, while decreasing 2.1% quarter-over-quarter Same-Store Operating Expense Year-over-Year Change (Q2 2025) | Expense Category | 2Q 2025 (Thousand USD) | 2Q 2024 (Thousand USD) | Percentage Change (%) | | :------------------- | :--------------- | :--------------- | :--------- | | Personnel | $18,902 | $17,685 | 6.9% | | Utilities | $17,867 | $17,024 | 4.9% | | Repair and Maintenance | $26,008 | $24,273 | 7.1% | | Administrative and Marketing | $10,006 | $8,974 | 11.5% | | **Total Controllable Expenses** | **$72,783** | **$67,956** | **7.1%** | | Real Estate Taxes | $49,071 | $50,871 | -3.5% | | Insurance | $5,309 | $6,216 | -14.6% | | **Total Same-Store Operating Expenses** | **$127,163** | **$125,043** | **1.7%** | Same-Store Operating Expense Quarter-over-Quarter Change (Q2 2025 vs. Q1 2025) | Expense Category | 2Q 2025 (Thousand USD) | 1Q 2025 (Thousand USD) | Percentage Change (%) | | :------------------- | :--------------- | :--------------- | :--------- | | Personnel | $18,902 | $19,539 | -3.3% | | Utilities | $17,867 | $19,217 | -7.0% | | Repair and Maintenance | $26,008 | $24,934 | 4.3% | | Administrative and Marketing | $10,006 | $9,698 | 3.2% | | **Total Controllable Expenses** | **$72,783** | **$73,388** | **-0.8%** | | Real Estate Taxes | $49,071 | $51,347 | -4.4% | | Insurance | $5,309 | $5,205 | 2.0% | | **Total Same-Store Operating Expenses** | **$127,163** | **$129,940** | **-2.1%** | [Same-Store Operating Information By Major Market](index=12&type=section&id=Attachment%208(A-G)%20Same-Store%20Operating%20Information%20By%20Major%20Market) In Q2 2025, UDR's same-store operating performance showed regional variations, with overall revenue growth of 2.5% and NOI growth of 2.9%, while new lease growth slowed and renewal growth remained stable [Current Quarter vs. Prior Year Quarter (Physical Occupancy & Revenue per Occupied Home)](index=12&type=section&id=Current%20Quarter%20vs.%20Prior%20Year%20Quarter%20(Physical%20Occupancy%20%26%20Revenue%20per%20Occupied%20Home)) Major Market Same-Store Physical Occupancy and Revenue per Occupied Home Year-over-Year Change (Q2 2025) | Region | 2Q 25 Physical Occupancy (%) | 2Q 24 Physical Occupancy (%) | Change (%) | 2Q 25 Revenue per Occupied Home ($) | 2Q 24 Revenue per Occupied Home ($) | Change (%) | | :---------------- | :--------------- | :--------------- | :--- | :----------------------- | :----------------------- | :--- | | West | 96.9% | 96.5% | 0.4% | $3,133 | $3,052 | 2.7% | | Mid-Atlantic | 97.0% | 97.1% | -0.1% | $2,339 | $2,235 | 4.7% | | Northeast | 97.2% | 97.0% | 0.2% | $3,657 | $3,537 | 3.4% | | Southeast | 96.4% | 96.6% | -0.2% | $1,977 | $1,979 | -0.1% | | Southwest | 97.0% | 96.7% | 0.3% | $1,784 | $1,804 | -1.1% | | Other Markets | 96.4% | 96.7% | -0.3% | $2,621 | $2,579 | 1.6% | | **Total/Weighted Average** | **96.9%** | **96.8%** | **0.1%** | **$2,572** | **$2,512** | **2.4%** | [Current Quarter vs. Prior Year Quarter (Revenues, Expenses, NOI)](index=13&type=section&id=Current%20Quarter%20vs.%20Prior%20Year%20Quarter%20(Revenues,%20Expenses,%20NOI)) Major Market Same-Store Revenue, Expenses, and NOI Year-over-Year Change (Q2 2025) | Region | 2Q 25 Revenue (Thousand USD) | 2Q 24 Revenue (Thousand USD) | Revenue Change (%) | 2Q 25 Expenses (Thousand USD) | 2Q 24 Expenses (Thousand USD) | Expense Change (%) | 2Q 25 NOI (Thousand USD) | 2Q 24 NOI (Thousand USD) | NOI Change (%) | | :---------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------ | | West | $119,475 | $115,834 | 3.1% | $30,420 | $30,359 | 0.2% | $89,055 | $85,475 | 4.2% | | Mid-Atlantic | $86,461 | $82,662 | 4.6% | $26,920 | $26,230 | 2.6% | $59,541 | $56,432 | 5.5% | | Northeast | $82,975 | $80,103 | 3.6% | $29,042 | $27,520 | 5.5% | $53,933 | $52,583 | 2.6% | | Southeast | $55,077 | $55,250 | -0.3% | $17,639 | $17,497 | 0.8% | $37,438 | $37,753 | -0.8% | | Southwest | $48,009 | $48,389 | -0.8% | $17,929 | $18,304 | -2.1% | $30,080 | $30,085 | 0.0% | | Other Markets | $18,521 | $18,277 | 1.3% | $5,213 | $5,133 | 1.6% | $13,308 | $13,144 | 1.2% | | **Total** | **$410,518** | **$400,515** | **2.5%** | **$127,163** | **$125,043** | **1.7%** | **$283,355** | **$275,472** | **2.9%** | [Current Quarter vs. Last Quarter (Physical Occupancy & Revenue per Occupied Home)](index=14&type=section&id=Current%20Quarter%20vs.%20Last%20Quarter%20(Physical%20Occupancy%20%26%20Revenue%20per%20Occupied%20Home)) Major Market Same-Store Physical Occupancy and Revenue per Occupied Home Quarter-over-Quarter Change (Q2 2025 vs. Q1 2025) | Region | 2Q 25 Physical Occupancy (%) | 1Q 25 Physical Occupancy (%) | Change (%) | 2Q 25 Revenue per Occupied Home ($) | 1Q 25 Revenue per Occupied Home ($) | Change (%) | | :---------------- | :--------------- | :--------------- | :--- | :----------------------- | :----------------------- | :--- | | West | 96.9% | 97.2% | -0.3% | $3,133 | $3,102 | 1.0% | | Mid-Atlantic | 97.0% | 97.5% | -0.5% | $2,339 | $2,321 | 0.9% | | Northeast | 97.2% | 97.3% | -0.1% | $3,657 | $3,621 | 1.0% | | Southeast | 96.4% | 97.0% | -0.6% | $1,977 | $1,966 | 0.6% | | Southwest | 97.0% | 97.3% | -0.3% | $1,784 | $1,777 | 0.4% | | Other Markets | 96.4% | 96.1% | 0.3% | $2,621 | $2,600 | 0.8% | | **Total/Weighted Average** | **96.9%** | **97.2%** | **-0.3%** | **$2,572** | **$2,550** | **0.9%** | [Current Quarter vs. Last Quarter (Revenues, Expenses, NOI)](index=15&type=section&id=Current%20Quarter%20vs.%20Last%20Quarter%20(Revenues,%20Expenses,%20NOI)) Major Market Same-Store Revenue, Expenses, and NOI Quarter-over-Quarter Change (Q2 2025 vs. Q1 2025) | Region | 2Q 25 Revenue (Thousand USD) | 1Q 25 Revenue (Thousand USD) | Revenue Change (%) | 2Q 25 Expenses (Thousand USD) | 1Q 25 Expenses (Thousand USD) | Expense Change (%) | 2Q 25 NOI (Thousand USD) | 1Q 25 NOI (Thousand USD) | NOI Change (%) | | :---------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------ | | West | $119,475 | $118,638 | 0.7% | $30,420 | $31,796 | -4.3% | $89,055 | $86,842 | 2.5% | | Mid-Atlantic | $86,461 | $86,222 | 0.3% | $26,920 | $27,207 | -1.1% | $59,541 | $59,015 | 0.9% | | Northeast | $82,975 | $82,253 | 0.9% | $29,042 | $29,796 | -2.5% | $53,933 | $52,457 | 2.8% | | Southeast | $55,077 | $55,116 | -0.1% | $17,639 | $17,598 | 0.2% | $37,438 | $37,518 | -0.2% | | Southwest | $48,009 | $47,962 | 0.1% | $17,929 | $18,346 | -2.3% | $30,080 | $29,616 | 1.6% | | Other Markets | $18,521 | $18,312 | 1.1% | $5,213 | $5,197 | 0.3% | $13,308 | $13,115 | 1.5% | | **Total** | **$410,518** | **$408,503** | **0.5%** | **$127,163** | **$129,940** | **-2.1%** | **$283,355** | **$278,563** | **1.7%** | [Current Year-to-Date vs. Prior Year-to-Date (Physical Occupancy & Revenue per Occupied Home)](index=16&type=section&id=Current%20Year-to-Date%20vs.%20Prior%20Year-to-Date%20(Physical%20Occupancy%20%26%20Revenue%20per%20Occupied%20Home)) Major Market Same-Store Physical Occupancy and Revenue per Occupied Home Year-to-Date Change (H1 2025) | Region | YTD 25 Physical Occupancy (%) | YTD 24 Physical Occupancy (%) | Change (%) | YTD 25 Revenue per Occupied Home ($) | YTD 24 Revenue per Occupied Home ($) | Change (%) | | :---------------- | :--------------- | :--------------- | :--- | :----------------------- | :----------------------- | :--- | | West | 97.0% | 96.8% | 0.2% | $3,129 | $3,047 | 2.7% | | Mid-Atlantic | 97.3% | 97.2% | 0.1% | $2,321 | $2,220 | 4.6% | | Northeast | 97.3% | 97.2% | 0.1% | $3,638 | $3,516 | 3.5% | | Southeast | 96.7% | 96.7% | 0.0% | $1,973 | $1,970 | 0.1% | | Southwest | 97.2% | 96.6% | 0.6% | $1,781 | $1,799 | -1.0% | | Other Markets | 96.3% | 97.0% | -0.7% | $2,610 | $2,561 | 1.9% | | **Total/Weighted Average** | **97.1%** | **96.9%** | **0.2%** | **$2,561** | **$2,502** | **2.4%** | [Current Year-to-Date vs. Prior Year-to-Date (Revenues, Expenses, NOI)](index=17&type=section&id=Current%20Year-to-Date%20vs.%20Prior%20Year-to-Date%20(Revenues,%20Expenses,%20NOI)) Major Market Same-Store Revenue, Expenses, and NOI Year-to-Date Change (H1 2025) | Region | YTD 25 Revenue (Thousand USD) | YTD 24 Revenue (Thousand USD) | Revenue Change (%) | YTD 25 Expenses (Thousand USD) | YTD 24 Expenses (Thousand USD) | Expense Change (%) | YTD 25 NOI (Thousand USD) | YTD 24 NOI (Thousand USD) | NOI Change (%) | | :---------------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------- | :--------------- | :--------------- | :------ | | West | $235,836 | $228,922 | 3.0% | $61,994 | $59,798 | 3.7% | $173,842 | $169,124 | 2.8% | | Mid-Atlantic | $167,985 | $160,539 | 4.6% | $52,443 | $50,612 | 3.6% | $115,542 | $109,927 | 5.1% | | Northeast | $165,228 | $159,523 | 3.6% | $58,839 | $56,466 | 4.2% | $106,389 | $103,057 | 3.2% | | Southeast | $110,194 | $110,101 | 0.1% | $35,238 | $35,108 | 0.4% | $74,956 | $74,993 | 0.0% | | Southwest | $95,971 | $96,427 | -0.5% | $36,275 | $36,857 | -1.6% | $59,696 | $59,570 | 0.2% | | Other Markets | $36,833 | $36,396 | 1.2% | $10,409 | $10,391 | 0.2% | $26,424 | $26,005 | 1.6% | | **Total** | **$812,047** | **$791,908** | **2.5%** | **$255,198** | **$249,232** | **2.4%** | **$556,849** | **$542,676** | **2.6%** | [Lease Rate Growth and Turnover](index=18&type=section&id=Lease%20Rate%20Growth%20and%20Turnover) Major Market Effective Lease Rate Growth and Annualized Turnover (Q2 2025) | Region | Effective Blended Lease Rate Growth (%) | Effective New Lease Rate Growth (%) | Effective Renewal Lease Rate Growth (%) | Annualized Turnover (2Q 2025) (%) | Annualized Turnover (2Q 2024) (%) | | :---------------- | :--------------- | :--------------- | :--------------- | :-------------------- | :-------------------- | | West | 4.2% | 4.4% | 4.0% | 39.1% | 44.2% | | Mid-Atlantic | 3.6% | 0.2% | 6.6% | 40.9% | 43.9% | | Northeast | 4.3% | 2.3% | 5.7% | 44.1% | 45.2% | | Southeast | 0.0% | -4.1% | 4.5% | 46.8% | 51.1% | | Southwest | -0.5% | -5.3% | 4.4% | 38.7% | 45.8% | | Other Markets | -1.1% | -5.1% | 3.1% | 45.2% | 43.1% | | **Total/Weighted Average** | **2.8%** | **0.3%** | **5.0%** | **41.2%** | **45.4%** | - In Q2 2025, overall effective blended lease rate growth was **2.8%**, with new lease growth at **0.3%** and renewal growth at **5.0%**. Annualized turnover decreased from **45.4%** in the prior year to **41.2%**, indicating improved tenant retention[62](index=62&type=chunk) [Portfolio Overview & Development](index=10&type=section&id=Portfolio%20Overview%20%26%20Development) [Apartment Home Breakout](index=10&type=section&id=Attachment%207(A)%20Apartment%20Home%20Breakout) As of June 30, 2025, UDR's apartment portfolio included 60,235 completed homes and 186 communities, with an additional 300 homes under development, and the Western region holding the largest number of homes Apartment Home Portfolio Overview (As of June 30, 2025) | Region | Same-Store Homes | Non-Mature Consolidated Homes | Total Homes (Excluding JV) | Unconsolidated Joint Venture Homes | Total Homes (Including JV) | Revenue per Occupied Home ($) | | :---------------- | :------- | :----------- | :----------- | :--------------- | :----------- | :--------------- | | West | 13,116 | - | 13,116 | 1,927 | 15,043 | $3,161 | | Mid-Atlantic | 12,697 | - | 12,697 | 360 | 13,057 | $2,474 | | Northeast | 7,784 | 478 | 8,262 | 1,876 | 10,138 | $3,281 | | Southeast | 9,631 | 330 | 9,961 | - | 9,961 | $2,227 | | Southwest | 9,244 | 85 | 9,329 | - | 9,329 | $1,798 | | Other Markets | 2,443 | - | 2,443 | 264 | 2,707 | $2,636 | | **Total** | **54,915** | **893** | **55,808** | **4,427** | **60,235** | **$2,614** | | **Total Communities** | **165** | **3** | **168** | **18** | **186** | | | **Homes Under Development** | | | | | **300** | | | **Total Homes at Quarter-End** | | | | | **60,535** | | [Non-Mature Home Summary and Net Operating Income by Market](index=11&type=section&id=Attachment%207(B)%20Non-Mature%20Home%20Summary%20and%20Net%20Operating%20Income%20by%20Market) UDR's non-mature homes are primarily in Dallas, Tampa, and Philadelphia, with the Western region contributing the largest share of NOI at 32.0% Non-Mature Home Breakout and Expected Same-Store Quarter | Community | Category | Number of Homes | Market | Expected Same-Store Quarter | | :---------------- | :--------------- | :------- | :--------- | :----------- | | Villas at Fiori | Stabilized, Non-Mature | 85 | Dallas, TX | 2Q26 | | 101 N. Meridian | Stabilized, Non-Mature | 330 | Tampa, FL | 3Q26 | | Broadridge | Acquired | 478 | Philadelphia, PA | 4Q27 | | **Total** | | **893** | | | Net Operating Income (NOI) Contribution by Market (As of June 30, 2025) | Region | Same-Store NOI Contribution (%) | Total NOI Contribution (%) | | :---------------- | :---------- | :-------- | | West | 31.4% | 32.0% | | Mid-Atlantic | 21.0% | 19.9% | | Northeast | 19.1% | 20.6% | | Southeast | 13.2% | 12.7% | | Southwest | 10.6% | 10.1% | | Other Markets | 4.7% | 4.7% | | **Total** | **100.0%** | **100.0%** | [Development and Land Summary](index=19&type=section&id=Attachment%209%20Development%20and%20Land%20Summary) UDR has one wholly-owned development project, "3099 Iowa," under construction in Riverside, CA, comprising 300 homes, and holds 7 land parcels with a total real estate cost of $230.69 million Wholly-Owned Development Project Overview (As of June 30, 2025) | Community | Location | Number of Homes | Completion Date | Budgeted Cost (Thousand USD) | Cost per Home (Thousand USD) | Expected Occupancy/Completion | | :---------------- | :--------- | :------- | :------- | :-------------- | :-------------- | :------------ | | 3099 Iowa | Riverside, CA | 300 | - | $133,600 | $445 | 1Q27/2Q27 | | **Total Under Development** | | **300** | | **$133,600** | **$445** | | | **Total Land (7 Parcels)** | Various Locations | | | **$230,690** | | | [Joint Ventures & Investment Programs](index=20&type=section&id=Joint%20Ventures%20%26%20Investment%20Programs) [Unconsolidated Joint Ventures and Partnerships](index=20&type=section&id=Attachment%2010%20Unconsolidated%20Joint%20Ventures%20and%20Partnerships) UDR holds 4,427 homes across 18 communities through joint ventures with MetLife and LaSalle, with total project debt of $890.6 million and UDR's equity investment of $467.7 million Unconsolidated Joint Venture Overview (As of June 30, 2025) | Portfolio Characteristics | UDR Ownership Percentage (%) | Number of Communities | Number of Homes | 2Q 25 Physical Occupancy (%) | 2Q 25 Revenue per Occupied Home ($) | 2Q 25 UDR's Share of NOI (Thousand USD) | | :------------------- | :----------- | :------- | :------- | :--------------- | :--------------- | :----------------------- | | UDR / MetLife | 50% | 13 | 2,837 | 96.8% | $4,281 | $11,002 | | UDR / LaSalle | 51% | 5 | 1,590 | 96.7% | $2,742 | $4,631 | | **Total** | | **18** | **4,427** | **96.7%** | **$3,723** | **$15,633** | | **Balance Sheet Characteristics** | | | | | | | | UDR / MetLife Total Project Debt (Thousand USD) | | | | | | $845,320 | | UDR / LaSalle Total Project Debt (Thousand USD) | | | | | | $45,306 | | UDR / MetLife UDR Equity Investment (Thousand USD) | | | | | | $204,812 | | UDR / LaSalle UDR Equity Investment (Thousand USD) | | | | | | $262,912 | | **Total Project Debt (Thousand USD)** | | | | | | **$890,626** | | **Total UDR Equity Investment (Thousand USD)** | | | | | | **$467,724** | | **Weighted Average Debt Interest Rate (%)** | | | | | | **4.03%** | [Debt and Preferred Equity Program](index=20&type=section&id=Debt%20and%20Preferred%20Equity%20Program) UDR's Debt and Preferred Equity Program has total investment commitments of $430.77 million and an invested balance of $483.6 million, with a weighted average contractual return of 9.7% and an average maturity of 2.3 years Debt and Preferred Equity Program Investment Overview (As of June 30, 2025) | Investment Classification | Investment Commitment (Thousand USD) | Balance (Thousand USD) | Contractual Return Rate (%) | Weighted Average Maturity (Years) | | :--------------------------- | :--------------- | :------------- | :----------- | :--------------- | | Non-Stabilized Communities - Preferred Equity | $96,547 | $115,092 | 10.1% | 1.0 | | Non-Stabilized Communities - Loans | $84,123 | $105,908 | 11.0% | 1.5 | | Stabilized Communities - Preferred Equity | $250,099 | $262,600 | 9.2% | 3.0 | | **Total Debt and Preferred Equity Program** | **$430,769** | **$483,600** | **9.7%** | **2.3** | | **2Q 25 Investment Income (Thousand USD)** | | **$13,393** | | | | **Other Unconsolidated Investments** | | | | | | Total Real Estate Technology and Sustainability Investments (Thousand USD) | $169,000 | $133,021 | | | | 2Q 25 Investment Income/(Loss) (Thousand USD) | | ($59) | | | - In May 2025, UDR acquired the developer's equity in its Philadelphia apartment community joint venture, resulting in the JV becoming a wholly-owned subsidiary and consolidating its financials, recognizing **$3.9 million** in unaccrued interest and **$0.3 million** in consolidation gain[71](index=71&type=chunk) - This quarter, UDR recovered approximately **$54.8 million** of its preferred equity investment in a stabilized New York City community, including accrued returns[72](index=72&type=chunk) [Acquisitions, Dispositions, and Debt and Preferred Equity Program Summary](index=21&type=section&id=Attachment%2011%20Acquisitions,%20Dispositions,%20and%20Debt%20and%20Preferred%20Equity%20Program%20Summary) In H1 2025, UDR completed two wholly-owned property dispositions totaling $211.5 million, acquired the Broadridge community for $182.5 million, and managed new investments and redemptions within its Debt and Preferred Equity Program Wholly-Owned Dispositions Overview (H1 2025) | Sale Date | Community | Location | Price (Thousand USD) | Number of Homes | Price per Home (Thousand USD) | | :--------- | :----------- | :----------- | :------------ | :------- | :-------------- | | January 2025 | One William | Englewood, NJ | $84,000 | 185 | $454 | | January 2025 | Leonard Pointe | Brooklyn, NY | $127,500 | 188 | $678 | | **Total** | | | **$211,500** | **373** | **$567** | Wholly-Owned Acquisition Overview (May 2025) | Acquisition Date | Community | Location | Price (Thousand USD) | Number of Homes | Price per Home (Thousand USD) | | :--------- | :----------- | :----------- | :------------ | :------- | :-------------- | | May 2025 | Broadridge | Philadelphia, PA | $182,500 | 478 | $382 | | **Total** | | | **$182,500** | **478** | **$382** | Debt and Preferred Equity Program Investments and Redemptions (Q2 2025) | Investment/Redemption Date | Investment Classification | Market | UDR Investment Commitment (Thousand USD) | Proceeds Received Upon Redemption (Thousand USD) | Contractual Return Rate (%) | | :-------------- | :----------- | :----------- | :------------------- | :-------------------- | :----------- | | April 2025 | Stabilized Community | San Francisco, CA | $13,000 | | 12.0% | | June 2025 | Stabilized Community | New York, NY | $40,000 | $54,760 | 11.0% | [Capital Expenditures](index=22&type=section&id=Capital%20Expenditures) [Capital Expenditure and Repair and Maintenance Summary](index=22&type=section&id=Attachment%2012%20Capital%20Expenditure%20and%20Repair%20and%20Maintenance%20Summary) In Q2 2025, UDR's recurring capital expenditures totaled $27.76 million ($502 per home), with NOI-enhancing capital expenditures at $21.15 million ($382 per home), alongside $26.25 million in repair and maintenance expenses Consolidated Home Capital Expenditure and Repair and Maintenance Summary (Q2 and H1 2025) | Metric (Thousand USD) | 2Q 2025 | Cost per Home ($) | H1 2025 | Cost per Home ($) | | :----------------------------------- | :------------- | :----------- | :----------- | :----------- | | Average Number of Homes | 55,325 | | 55,324 | | | Total Recurring Capital Expenditures | $27,757 | $502 | $45,040 | $814 | | NOI Enhancing Capital Expenditures | $21,148 | $382 | $35,203 | $636 | | **Total Recurring and NOI Enhancing Capital Expenditures** | **$48,905** | **$884** | **$80,243** | **$1,450** | | **Total Repair and Maintenance (Expensed)** | **$26,254** | **$475** | **$51,258** | **$927** | [Guidance](index=23&type=section&id=Guidance) [3Q 2025 and Full-Year 2025 Guidance](index=23&type=section&id=Attachment%2013%203Q%202025%20and%20Full-Year%202025%20Guidance) UDR updated its full-year 2025 guidance, raising diluted FFO as Adjusted per share to $2.49-$2.55 and increasing same-store revenue and NOI growth projections 3Q 2025 and Full-Year 2025 Net Income, FFO, and FFO as Adjusted Per Share Guidance | Metric | 3Q 2025 | Full-Year 2025 | Change from Prior Guidance Midpoint ($) | | :------------------------------------------------- | :-------------- | :-------------- | :----------------- | | Diluted Net Income/(Loss) Per Share ($) | $0.11 to $0.13 | $0.53 to $0.59 | ($0.05) | | Diluted FFO Per Share ($) | $0.61 to $0.63 | $2.42 to $2.48 | ($0.05) | | Diluted FFO as Adjusted Per Share ($) | $0.62 to $0.64 | $2.49 to $2.55 | $0.02 | | Diluted Weighted Average Common Stock, OP/DownREIT Units, and Common Stock Equivalents (Millions) | 357.6 | 358.0 | - | | Annualized Dividend Per Share ($) | | $1.72 | - | Full-Year 2025 Same-Store Performance Guidance (Straight-Line) | Metric | Full-Year 2025 | Change from Prior Guidance Midpoint (%) | | :------------------- | :-------------- | :----------------- | | Revenue Growth/(Decline) (%) | 1.75% to 3.25% | 0.25% | | Expense Growth (%) | 2.50% to 3.50% | (0.50%) | | NOI Growth/(Decline) (%) | 1.50% to 3.00% | 0.50% | Full-Year 2025 Investment and Corporate Expense Guidance (Million USD) | Metric | Full-Year 2025 | Change from Prior Guidance Midpoint (Million USD) | | :------------------------------------------------- | :-------------- | :----------------- | | Dispositions - Consolidated and Joint Ventures (Pro Rata) | $215 to $415 | - | | Acquisitions - Consolidated and Joint Ventures (Pro Rata) | $0 to $200 | - | | Capital Expenditures - Recurring, NOI Enhancing, and Redevelopment | $220 to $260 | - | | Consolidated Interest Expense, Net of Capitalized Interest and FFO as Adjusted Adjustments | $190 to $195 | $2.5 | | General and Administrative Expenses | $72 to $80 | $1 | [Definitions and Reconciliations](index=24&type=section&id=Definitions%20and%20Reconciliations) [Key Definitions](index=24&type=section&id=Attachment%2014(A-C)%20Definitions%20and%20Reconciliations) This section defines key financial and operational terms like FFO, FFO as Adjusted, AFFO, EBITDAre, same-store communities, NOI, capital expenditure types, and coverage ratios, ensuring consistent understanding of the company's performance reporting - FFO (Funds from Operations) is calculated according to Nareit standards to evaluate the operating performance of Real Estate Investment Trusts (REITs) and does not represent cash flow under GAAP[109](index=109&type=chunk)[110](index=110&type=chunk) - FFO as Adjusted provides a more consistent comparison of operating performance by excluding non-comparable items such as acquisition costs, debt extinguishment costs/gains, and disaster-related expenses[107](index=107&type=chunk)[108](index=108&type=chunk) - NOI (Net Operating Income) is defined as rental income less direct property operating expenses, serving as a useful metric for measuring the ongoing operating performance of communities by excluding company-level expense allocations, general and administrative costs, capital structure, and depreciation and amortization[112](index=112&type=chunk)[113](index=113&type=chunk) [FFO and FFO as Adjusted Guidance Reconciliation](index=27&type=section&id=Attachment%2014(D)%20Definitions%20and%20Reconciliations) This section reconciles GAAP net income per share to projected FFO and FFO as Adjusted per share for full-year 2025 and Q3, detailing the impact of various adjustments Reconciliation from GAAP Net Income to FFO and FFO as Adjusted Per Share (Full-Year 2025) | Metric | Low ($) | High ($) | | :------------------------------------------------- | :--- | :--- | | Projected Diluted Net Income Per Share | $0.53 | $0.59 | | GAAP Share Conversion | (0.02) | (0.02) | | Net Gain on Disposition of Depreciable Real Estate | (0.13) | (0.13) | | Depreciation | 2.00 | 2.00 | | Non-Controlling Interests | 0.03 | 0.03 | | Preferred Stock Dividends | 0.01 | 0.01 | | **Projected Diluted FFO Per Share** | **$2.42** | **$2.48** | | Legal and Other Costs | 0.02 | 0.02 | | Software Conversion-Related Costs | 0.03 | 0.03 | | Disaster-Related Expenses/(Recoveries) | 0.02 | 0.02 | | Real Estate Technology Investment Realized/Unrealized Gains/(Losses) | - | - | | **Projected Diluted FFO as Adjusted Per Share** | **$2.49** | **$2.55** | Reconciliation from GAAP Net Income to FFO and FFO as Adjusted Per Share (3Q 2025) | Metric | Low ($) | High ($) | | :------------------------------------------------- | :--- | :--- | | Projected Diluted Net Income Per Share | $0.11 | $0.13 | | GAAP Share Conversion | (0.01) | (0.01) | | Depreciation | 0.50 | 0.50 | | Non-Controlling Interests | 0.01 | 0.01 | | Preferred Stock Dividends | - | - | | **Projected Diluted FFO Per Share** | **$0.61** | **$0.63** | | Software Conversion-Related Costs | 0.01 | 0.01 | | **Projected Diluted FFO as Adjusted Per Share** | **$0.62** | **$0.64** | [Forward-Looking Statements](index=28&type=section&id=Forward-Looking%20Statements) [Forward-Looking Statements Disclaimer](index=28&type=section&id=Forward-Looking%20Statements%20Disclaimer) This report contains "forward-looking statements" involving estimates, forecasts, targets, projections, and assumptions, subject to risks and uncertainties that could cause actual results to differ materially, and the company disclaims any obligation to update these statements - Forward-looking statements inherently involve estimates, forecasts, targets, projections, and assumptions, subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed[129](index=129&type=chunk) - Risk factors include, but are not limited to: general market and economic conditions, adverse changes in apartment market and economic conditions, the impact of inflation/deflation on rental rates and property operating expenses, capital availability and capital market stability, tariff impacts, geopolitical tensions, changes in immigration policies, high interest rates, competition and competitive pricing, acquisitions, developments, and redevelopments failing to achieve anticipated results, delays in completing developments, redevelopments, and lease-ups on schedule or at anticipated rents and occupancy, changes in employment growth, housing affordability, and the supply/demand ratio for multifamily housing[129](index=129&type=chunk) - The company expressly disclaims any obligation to update or revise any forward-looking statements, except as required by U.S. securities laws[129](index=129&type=chunk)