Summary of the Conference Call Company Overview - The company discussed is UMH Properties, which owns 141 manufactured home communities in the Eastern United States, with over 26,500 developed home sites [2][3]. Core Business Model - UMH provides factory-built homes for sale or rent, emphasizing affordability and community living [3][4]. - The cost of a 1,000 square foot three-bedroom, two-bath house is approximately $70,000, with lot costs varying from $30,000 to $100,000 [4]. - The rental price for homes is set at around $1,000 per month, targeting individuals earning between $40,000 to $80,000 annually [4][10]. Market Demand and Growth - There is a significant shortage of affordable housing in the U.S., estimated at over 4 million units [8]. - Since 2011, UMH has rented out 10,400 homes and plans to add 800 rental units annually [6][12]. - The company has seen a 10.8% average same-property NOI growth over the past five years [17]. Financial Performance - Sales are projected to approach $40 million, with current sales at over $30 million [13]. - The company has maintained strong rent collection rates, around 98.5% to 99% [19]. - Revenue for the company is projected at $200 million, with expectations of a 5% rent increase contributing an additional $10 million [25]. Challenges and Solutions - The company faced challenges with retail financing and supply chain disruptions, particularly during the COVID-19 pandemic [12][24]. - UMH has adapted by focusing on rental homes, which has allowed them to fill communities that others could not [12]. - The company has a strong balance sheet with $35 million in cash and has recently refinanced communities to improve its financial position [43][44]. Future Outlook - UMH is optimistic about future growth, with plans to continue adding rental units and expanding its portfolio [28][32]. - The company anticipates that demographic trends will favor their business model, particularly among retirees and young families [30]. - The management believes that the rental program will continue to be successful, with homes appreciating in value over time [24][60]. Capital Needs and Financing - The company requires approximately $100 million to $150 million annually to support its growth strategy, including acquisitions and capital expenditures [42]. - Recent refinancing efforts have proven the effectiveness of their business plan, with significant increases in property appraisals [44][46]. Conclusion - UMH Properties is positioned for continued growth in the manufactured home community sector, leveraging its business model to address the ongoing demand for affordable housing while maintaining strong financial performance and operational efficiency [56][58].

Group 1 - Real estate preferred shares are currently facing significant discounts, indicating potential undervaluation in the market [1] - Investors are cautious due to the looming credit risk that could further depress valuations in the real estate sector [1] - Pearl Gray specializes in systematic analysis of Bonds, Preferreds, and REITs, focusing primarily on the Financials and Real Estate sectors [1] Group 2 - The mission of Pearl Gray is to identify actionable total return ideas by integrating rigorous academic theories with practical experience [1]

Core Viewpoint - UMH Properties, Inc. will participate in the Nareit's REITweek: 2025 Investor Conference in New York City on June 3, 2025 [1] Company Overview - UMH Properties, Inc. is a public equity REIT established in 1968, owning and operating 141 manufactured home communities with approximately 26,500 developed homesites, including 10,400 rental homes and over 1,000 self-storage units [3] - The communities are located across multiple states including New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Maryland, Michigan, Alabama, South Carolina, Florida, and Georgia [3] - Among the 141 communities, there are two in Florida with 363 sites, operated through a joint venture with Nuveen Real Estate [3] Event Details - The presentation by UMH's senior management team is scheduled for June 3, 2025, at 10:15 a.m. Eastern Time and will be available via live webcast on the company's website [2] - A replay of the webcast will be accessible for 30 days following the presentation, and presentation materials will also be available on the company's homepage [2]

Core Viewpoint - UMH Properties, Inc. has successfully added ten communities with 2,001 sites to its Fannie Mae credit facility, securing approximately $101.4 million in proceeds to support further investments and debt repayment [1][2]. Group 1: Financial Details - The loan is an interest-only loan with a fixed rate of 5.855% and a 10-year term [1]. - The ten communities were appraised at $163.5 million, equating to $82,000 per site, while the total investment in these communities is approximately $66.6 million [2]. - The increase in value of these communities is $96.9 million, representing a 146% rise from the original cost basis [2]. Group 2: Business Strategy and Operations - The proceeds from the refinancing will be utilized for additional acquisitions, expansions, rental homes, and to repay higher interest rate debt on a short-term basis [1]. - UMH Properties operates 141 manufactured home communities with around 26,500 developed homesites, including 10,400 rental homes and over 1,000 self-storage units across multiple states [3]. - The company aims to provide additional affordable housing while generating significant long-term results for shareholders [3].

Core Insights - UMH Properties, Inc. has published its 2024 Sustainability Report, emphasizing its commitment to sustainability and responsible management in the manufactured home community sector [1][2]. Company Overview - UMH Properties, Inc. is a public equity REIT established in 1968, owning and operating 141 manufactured home communities with approximately 26,500 developed homesites, including 10,400 rental homes and over 1,000 self-storage units [2]. Sustainability Commitment - The company’s sustainability approach focuses on providing safe, high-quality, and affordable housing, enhancing resource efficiency, and fostering vibrant neighborhoods [2]. - The latest Sustainability Report outlines the progress made in building a resilient and responsible future, highlighting transparency, accountability, and continuous improvement [2]. Operational Footprint - The manufactured home communities are located across several states, including New Jersey, New York, Ohio, Pennsylvania, Tennessee, Indiana, Maryland, Michigan, Alabama, South Carolina, Florida, and Georgia [2]. - Among the 141 communities, two are in Florida, containing 363 sites, operated through a joint venture with Nuveen Real Estate [2].

The Buy Thesis - UMH Properties (NYSE:UMH) presents a compelling investment opportunity with a combination of value and growth, featuring over five years of double-digit organic growth while trading at a significant discount to net asset value (NAV) [1] - The current trading multiple of UMH is 17.5X forward AFFO, which is notably lower than its peers in the manufactured housing sector [1] Manufactured Housing's Growth Cycle - The manufactured housing sector has experienced positive same-store net operating income (NOI) growth for over 27 consecutive years, a remarkable achievement in real estate [11] - UMH's same-store NOI has averaged just over 10% annually for the past decade, outperforming peers [11] - The sector's growth has persisted through various economic downturns, including the tech bubble, the Great Financial Crisis, and COVID-19 [11] Supply Constraints - The growth in manufactured housing is sustained by regulatory constraints that limit new supply, preventing the typical negative feedback mechanisms seen in other real estate sectors [12] - Unlike other sectors where overbuilding can cool growth, manufactured housing benefits from a capped supply due to regulatory hurdles [12] Sector Valuation - Peers of UMH, such as Equity LifeStyle Properties (ELS) and Sun Communities (SUI), trade at higher multiples of 23.4X and 22.3X 2026 estimated AFFO, respectively [15] - The market is currently undervaluing UMH, which trades at only 16.9X 2026 AFFO due to recent market sell-offs and delayed recognition of some assets [17][19] Growth Pipeline and Future Potential - UMH has a substantial growth pipeline with 3,300 vacant sites ready for occupancy and 9,600 land plots available for development [45] - The company has been acquiring communities at low occupancy, which allows for significant upside potential as these assets are improved and stabilized [41][42] - The anticipated same-store NOI growth is expected to remain in the 8%-12% range, driven by rental rate increases and occupancy growth [45] AFFO/share Dynamics - The disparity between same-store NOI growth and AFFO/share growth is attributed to equity issuance, which has doubled the share count over the past five years [22] - Deleveraging efforts have reduced debt to gross properties from over 60% to under 40%, which, while dilutive in the short term, enhances liquidity and reduces risk [33][36] - The time delay in realizing cash flows from new investments contributes to the slower AFFO/share growth compared to same-store NOI growth [38] Market Mispricing - The market is currently not fully recognizing the future growth potential of UMH's non-cash-flowing assets, which could lead to a significant revaluation as these assets begin to generate income [44] - With a fair value estimated to be approximately 30% above the current share price, there is potential for substantial gains as the market adjusts [47] Risks - UMH is somewhat insulated from supply chain disruptions due to its inventory of approximately 500 homes, but long-term supply issues could impact growth [49] - Regulatory changes could potentially introduce new competition, affecting the favorable growth dynamics of the manufactured housing sector [51]

Financial Data and Key Metrics Changes - Normalized FFO for Q1 2025 was $0.23 per diluted share, up 5% from $0.22 per diluted share in the previous year [7][21] - Rental and related income increased by 8% to $54.6 million compared to $50.3 million a year ago [21] - Community NOI increased by 8% from $30 million in 2024 to $32.5 million in 2025 [22] Business Line Data and Key Metrics Changes - Same property occupancy increased by 113 units year-to-date and 227 units over the first quarter of last year [10] - Gross home sales for the quarter were $6.7 million, down approximately 9.5% from $7.4 million last year, primarily due to the liquidation of inventory at a sales center [11] - The rental home occupancy rate increased from 94% at year-end to 94.6% at the end of Q1 [14] Market Data and Key Metrics Changes - The company has 3,400 vacant sites and 2,400 acres of vacant land available for development, positioning it well for future growth [19][30] - Demand for affordable housing remains strong, with the company experiencing high occupancy levels and rental rates [29][30] Company Strategy and Development Direction - The company plans to continue increasing earnings through the occupancy of vacant sites, development of land, and acquisitions of existing communities [9][19] - The focus on duplex manufactured homes and solar shingle technology aims to provide affordable housing solutions [32][47] - The company is optimistic about future acquisitions, particularly in light of potential opportunities arising from less experienced buyers in the market [72] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving nearly 100% occupancy and continued progress in developing expansion land [30] - The company anticipates strong demand for rental homes and expects to add 800 new rental homes to its portfolio this year [14][28] - Management remains cautious about the impact of tariffs but believes it will have a minimal effect on operations [16][18] Other Important Information - The company has a strong balance sheet with a total market capitalization of approximately $2.5 billion, up 18% from the previous year [24] - The company has over $45 million invested in expansions that are not yet generating expected yields [13] Q&A Session Summary Question: What are the rent growth expectations for this year? - Management expects to achieve a 5% rent increase, with strong demand at properties [35][36] Question: Are home prices up due to tariffs? - Prices have increased slightly by 3% to 5%, but supply chain disruptions are a bigger concern [37][38] Question: What refinancing rates are expected? - Anticipated rates for refinancing are around 5.5% to 5.75% [39] Question: Is there upward pressure on real estate taxes? - There has been a small increase in real estate taxes, but management is working on potential appeals [42][43] Question: How are solar shingle homes being received? - Initial demand is strong, with several homes already occupied and more on the way [44][45] Question: What are the return expectations for the Mantua acquisition? - Expected returns are in the 6.5% to 7% range, with significant upside potential [79][80] Question: Will rental homes be included in GSE financing? - Currently, rental homes are not included, but income from the sites is considered [86][96]

Financial Data and Key Metrics Changes - Normalized FFO for Q1 2025 was $0.23 per diluted share, up 5% from $0.22 per diluted share in Q1 2024 [6][18] - Rental and related income increased by 8% to $54.6 million compared to $50.3 million a year ago [18] - Community NOI increased by 8% from $30 million in 2024 to $32.5 million in 2025 [19] Business Line Data and Key Metrics Changes - Same property occupancy increased by 113 units year-to-date and 227 units over the first quarter of last year [8] - Gross home sales for the quarter were $6.7 million, down approximately 9.5% from $7.4 million last year, primarily due to the liquidation of inventory at a sales center [9] - The rental home occupancy rate increased from 94% at year-end to 94.6% at the end of Q1 [12] Market Data and Key Metrics Changes - The company has over $45 million invested in expansions that are not yet generating expected yields [11] - The company anticipates the development of over 150 sites this year in markets with high occupancy levels and rental rates [10] - The total market capitalization increased by 18% to approximately $2.5 billion at quarter-end compared to $2.1 billion last year [21] Company Strategy and Development Direction - The company plans to continue increasing earnings and value through the occupancy of 3,400 vacant sites and the development of 2,400 acres of vacant land [7][16] - The company is focused on addressing the affordable housing crisis and believes its vacant sites and land are key to driving organic growth [28][30] - The company is exploring selling vacant land to single-family homebuilders or for other higher and better uses [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued strong demand for affordable housing and the potential for increased occupancy and sales [27][29] - The company is monitoring the impact of tariffs and geopolitical issues but currently sees minimal impact on operations [15] - Management believes the fundamentals of manufactured housing are strong and the company is well-positioned for growth [16][29] Other Important Information - The company has a strong balance sheet and is prepared to execute on compelling acquisitions as they become available [16][27] - The company has a proven track record of executing its business plan, with a total shareholder return of approximately 30% in 2024 [15] Q&A Session Summary Question: What are the rent growth expectations for this year? - Management confirmed they still expect to achieve a 5% rent increase throughout the year due to strong demand [34][35] Question: Are home prices up compared to pre-orders due to tariffs? - Prices have increased slightly by 3% to 5%, but supply chain disruptions are a bigger concern [36][37] Question: What refinancing rates are expected? - Anticipated rates for refinancing are around 5.5% to 5.75% [38] Question: Are there notable upward pressures on real estate taxes? - There has been a small increase in real estate taxes, and management is working on potential appeals [41][43] Question: How are solar shingle homes being received? - Initial demand for solar shingle homes is strong, with several already occupied [44][45] Question: What are the gross margins on new versus used home sales? - Sales are strong, particularly due to downsizing trends among older individuals [57][61] Question: Are there larger acquisition opportunities available? - Management indicated that there are opportunities due to many new entrants in the market who may not be well-informed [72] Question: How does GSE financing work for communities with rentals? - GSE financing currently includes income from the site but not the homes themselves, impacting LTV [94][96]

Company Highlights - UMH owns and operates 141 manufactured home communities with approximately 26,500 developed homesites across 11 states[8] - The company's rental portfolio is expanding, with approximately 10,400 units, an increase of 417 homes from March 2024 to March 2025, and anticipates adding 800 more homes this year[8] - UMH has approximately 3,400 existing vacant lots to fill and over 2,400 vacant acres to build approximately 9,600 future lots[8] - Sales & Finance division sold 370 homes over the past 12 months, generating approximately $91.6 million[9] Financial Performance (Q1 2025) - Rental and related income increased by 8%[15] - Community Net Operating Income (NOI) increased by 8%[15] - Normalized Funds from Operations (FFO) increased by 25%, and Normalized FFO per diluted share increased by 5%[15] - Same Property Community NOI increased by 8%[15] - Same Property Occupancy increased by 70 basis points, from 87.2% to 87.9%[15] Portfolio Statistics - Portfolio occupancy stands at 87.9%[18] - Average monthly site rent is $554[18] - Home rentals account for 39.9% of sites, with a home rental occupancy of 94.6%[18] - Gross asset value is $2.0 billion, and gross real estate book value is $1.7 billion[18] - Total market capitalization is $2.5 billion[18] Growth and Acquisitions - The company acquired two 100% fully occupied, age-restricted communities in New Jersey for approximately $24.6 million[15] - UMH has approximately 3,800 acres in existing communities exposed to the Marcellus and Utica Shale Regions[28] - The company has 2,375 vacant acres available for future development[59] Sales & Finance Division - Sales amounted to $6.7 million for the first quarter of 2025, with a sales price per unit of approximately $94,000[67] - The loan portfolio is $91.6 million with a weighted average interest rate of approximately 7.2%, generating approximately $12.9 million in principal and interest payments annually[67] Financial Highlights (Past 5 Years) - Total Revenue increased by 59%[79] - Community NOI increased by 79%[79] - Normalized FFO increased by 176%, and Normalized FFO per share increased by 49%[79] - Annual Dividend per share increased by 18%[79] Balance Sheet - Total Debt, Net of Unamortized Debt Issuance Costs is $606.301 million as of March 31, 2025[97] - Fixed rate debt accounts for 99.0% of total debt, while floating rate debt accounts for 1.0%[97]

Core Viewpoint - UMH Properties, Inc. reported a solid first quarter of 2025 with increased total income and improved financial metrics, reflecting the strength of its long-term business plan and operational resilience [2][7]. Financial Performance - Total Income for Q1 2025 was $61.2 million, up 6% from $57.7 million in Q1 2024 [2][4]. - Net Loss Attributable to Common Shareholders for Q1 2025 was $271,000 or $0.00 per diluted share, compared to a net loss of $6.3 million or $0.09 per diluted share in Q1 2024 [2][4]. - Funds from Operations (FFO) for Q1 2025 was $18.2 million or $0.22 per diluted share, a 10% increase from $14.0 million or $0.20 per diluted share in Q1 2024 [3][4]. - Normalized FFO for Q1 2025 was $18.8 million or $0.23 per diluted share, up 5% from $15.0 million or $0.22 per diluted share in Q1 2024 [3][4]. Operational Highlights - Same-property occupancy increased by 113 sites from year-end 2024, totaling 94.6% occupancy at the end of Q1 2025 [7]. - The company converted 109 new homes from inventory to revenue-generating rental homes, expanding its rental portfolio to approximately 10,400 homes [7]. - Gross sales revenue for home sales reached $6.7 million, with expectations for growth as the peak selling season approaches [7]. Acquisitions and Growth Strategy - The company acquired two fully occupied communities in New Jersey for approximately $24.6 million, enhancing its portfolio [8]. - Two additional communities in Maryland, containing 191 sites, are under contract for a total purchase price of $14.6 million, expected to close in Q2 2025 [7][8]. Dividend and Shareholder Returns - The annual dividend was increased for the fifth consecutive year to $0.90 per share, reflecting a total increase of $0.18 or 25% over the past five years [7][8]. - The company issued approximately 515,000 shares of common stock, generating gross proceeds of $9.4 million, and approximately 49,000 shares of Series D Preferred Stock, generating gross proceeds of $1.1 million [8]. Full Year Guidance - The company maintains its full-year 2025 guidance for normalized FFO in the range of $0.96-$1.04 per diluted share, with a midpoint expectation of $1.00 per diluted share [7][20].