BRT Apartments (US:BRT)2025-11-06 21:16Financial Performance - Total revenues for the three months ended September 30, 2025, were $24.434 million, a slight increase of 0.2% compared to $24.396 million in the same period of 2024 [116]. - Total revenues for the nine months ended September 30, 2025, increased by $1,076,000 (1.5%) to $72,737,000 compared to $71,661,000 in 2024, driven by a 0.2% increase in rental revenue and a 232.8% increase in loan interest and other income [128]. - For the three months ended September 30, 2025, FFO decreased to $5.215 million from $5.669 million in the same period of 2024, reflecting a decrease of approximately 8% [161]. - AFFO for the three months ended September 30, 2025, was $6.737 million, slightly down from $6.769 million in the prior year [161]. - For the nine months ended September 30, 2025, FFO increased to $16.379 million from $15.786 million in 2024, representing an increase of about 3.75% [161]. - AFFO for the nine months ended September 30, 2025, rose to $20.972 million compared to $19.771 million in the same period of 2024, marking an increase of approximately 6.1% [161]. - The company reported a GAAP net loss attributable to common stockholders of $(2,707,000) for the three months ended September 30, 2025, compared to $(2,205,000) in 2024 [171]. Expenses and Costs - The company incurred total expenses of $27.780 million for the three months ended September 30, 2025, reflecting a 2.0% increase from $27.242 million in the prior year [119]. - Interest expense rose to $5.882 million, an increase of 2.4% from $5.745 million in the same quarter of 2024 [119]. - Real estate operating expenses increased by 1.4% to $11.342 million, driven by higher real estate taxes, payroll, and utilities [119][120]. - Real estate operating expenses rose by $397,000 (1.2%) to $33,009,000, influenced by increased real estate taxes, utilities, repairs, and leasing expenses [131]. - Interest expense increased by $497,000 (3.0%) to $17,265,000, mainly due to additional financing costs related to the Woodlands Financing [134]. - The company’s general and administrative expenses increased to $3,937,000 for the three months ended September 30, 2025, compared to $3,811,000 in 2024, marking an increase of about 3.3% [171]. Property and Acquisitions - As of September 30, 2025, the company wholly owns 21 multi-family properties with a total of 5,420 units and a carrying value of $600.5 million [103]. - The company completed the acquisition of 1322 North, a 214-unit property for $36.5 million, with an 80% interest in the joint venture [104]. - A second acquisition, Oaks at Victory, a 150-unit property, was completed for $23 million, also with an 80% interest in the joint venture [105]. Liquidity and Financing - As of September 30, 2025, the company had available liquidity of approximately $37.1 million, including $14.6 million in cash and cash equivalents [140]. - The company anticipates needing to fund $196.3 million in balloon payments due through 2027, which may require issuing additional equity or disposing of properties if refinancing is not possible [141]. - At September 30, 2025, the company had mortgage debt of $737.6 million, with a weighted average interest rate of 4.12% for consolidated properties [143]. - The company anticipates refinancing $42.5 million in maturing mortgages with new debt of approximately $71.4 million, expecting an increase in interest expense of about $430,000 per quarter [110][111]. Economic Environment and Challenges - The company is facing challenges from an uncertain economic environment and oversupply of multi-family properties in several competitive markets [112]. - Equity in earnings of unconsolidated joint ventures decreased from $369,000 to a loss of $75,000, primarily due to $469,000 in amortization of lease intangibles from the Auburn Acquisition [123]. Operating Metrics - NOI is defined as "Rental and other revenue from real estate properties" less "Real estate operating expenses," providing a core measure of property performance [170]. - NOI is a non-GAAP measure and does not account for general and administrative expenses, interest expenses, or gains/losses as determined by GAAP [169]. - For the three months ended September 30, 2025, the Net Operating Income (NOI) decreased to $12,689,000, down from $12,990,000 in the same period of 2024, representing a decline of approximately 2.3% [171]. - For the nine months ended September 30, 2025, the NOI was $38,370,000, compared to $38,641,000 in 2024, reflecting a decrease of about 0.7% [171]. - The decrease in NOI for the three months was primarily due to a $155,000 increase in real estate operating expenses and a $146,000 decrease in rental revenue [171]. - The increase in real estate operating expenses for the nine months was $381,000 compared to the same period in 2024 [172]. Shareholder Returns - A quarterly cash dividend of $0.25 per share was paid on October 6, 2025, totaling approximately $4.7 million [151]. - The diluted shares outstanding for FFO and AFFO were 18,951,324 for the three months ended September 30, 2025, compared to 18,758,435 in the prior year [163].