Bluerock Homes Trust(BHM) - 2025 Q2 - Quarterly Report

Real Estate Investments - As of June 30, 2025, the company held 21 real estate investments, comprising 5,038 residential units, with a consolidated operating investment occupancy rate of approximately 91.4%[172] - The company acquired Southern Pines Reserve, a 272-unit residential community, for a purchase price of $56.6 million, funded by a $30.7 million senior loan, $20.0 million from the KeyBank Credit Facility, and $8.9 million in cash[182] - The company sold 85 units across various portfolios for an aggregate of approximately $15.1 million, generating net proceeds of approximately $10.7 million and a gain on sales of approximately $1.7 million[183] - The company increased its capital commitment for preferred equity interests in Wayford at Innovation Park by $2.0 million, raising the total investment to $15.4 million[186] - The company entered into a joint venture to invest $16.2 million for preferred equity interests in a 300-unit residential community in Sanford, North Carolina[186] - As of June 30, 2025, the company had funded $11.6 million of its $37.8 million commitment for preferred equity interests in multiple projects[188] Financial Performance - Total rental and other property revenues increased by 40.0% to $16.7 million for Q2 2025 compared to $11.9 million for Q2 2024[197] - Net operating income for residential communities rose by 129.7% to $5.0 million in Q2 2025, compared to $2.2 million in Q2 2024[197] - Average rental rate increased by 4.6% to $1,689 in Q2 2025 compared to $1,615 in Q2 2024[197] - Other income amounted to $0.2 million for the three months ended June 30, 2025, compared to an expense of $1.2 million for the same prior year period, primarily due to a $1.5 million gain on the sale of a preferred equity investment[210] - Net operating income (NOI) for the three months ended June 30, 2025, was $8.5 million, compared to $6.0 million for the same period in 2024[224] Occupancy and Rental Metrics - Average occupancy percentage decreased by 70 basis points to 91.6% in Q2 2025 from 92.3% in Q2 2024[197] - The company has a total of 3,640 operating units, including 94 units classified as held for sale[194] - Average rent per occupied unit increased by $74, or 4.6%, to $1,689, while average occupancy decreased by 70 basis points to 91.6% year over year[202] Expenses and Liabilities - Property operating expenses rose by $2.2 million, or 37%, to $8.2 million for the three months ended June 30, 2025, primarily due to the acquisition of 1,230 units[204] - Total property operating expenses for the six months ended June 30, 2025, increased by $4.8 million, or 44%, to $15.8 million compared to $11.0 million for the same prior year period[213] - Outstanding debt increased to $347.3 million at June 30, 2025, compared to $228.0 million at June 30, 2024[210] - The company had contractual obligations related to mortgage notes totaling $435.8 million, with estimated future required payments of $9.998 million in 2025 and $152.5 million from 2026 to 2027[230] Cash Flow and Equity - The company reported net cash provided by operating activities of $14.8 million for the six months ended June 30, 2025, despite a net loss of $13.2 million[244] - Total capital expenditures for the six months ended June 30, 2025, were $9.5 million, significantly higher than $3.8 million for the same period in 2024[246] - The company had $127.6 million in cash available as of June 30, 2025, and a capacity of $50 million on the KeyBank Credit Facility[232] - Total stockholders' equity decreased by $3.8 million from $139.1 million as of December 31, 2024, to $135.3 million as of June 30, 2025, primarily due to $5.3 million in declared dividends[192] Dividends and Stock - The company declared a quarterly dividend of $0.125 per share for Class A and Class C common stock, payable on April 4, 2025[256] - The company issued 1,201,235 shares of 6.0% Series A Redeemable Preferred Stock at $25.00 per share, generating net proceeds of approximately $26.0 million during the first half of 2025[190] - The company has a stock repurchase plan authorized for up to $5 million, with no repurchases made as of June 30, 2025[234] Risks and Market Conditions - The company is subject to risks from inflation and rising interest rates, which could impact residents' ability to pay rents and overall financial performance[178] - The company operates in markets with a focus on the knowledge-economy and high-quality of life growth markets in the Sunbelt and Western United States[171] - The company has interest rate caps and swaps covering $101.0 million of its debt to manage interest rate risk[266] Future Outlook - The company anticipates future investments in residential properties and build-to-rent communities to improve results related to its existing portfolio[229] - The company expects to maintain monthly distributions on its Series A Preferred Stock, funded through cash flow from operations and other sources[241] - The company made a commitment to fund estimated project costs of $56.9 million for the development of Abode Wendell Falls, with remaining estimated costs of $45.3 million[231]