Bluerock Homes Trust(BHM) - 2023 Q4 - Annual Report

Real Estate Investments - As of December 31, 2023, the company held 18 real estate investments, comprising 4,059 residential units, with a consolidated operating occupancy rate of approximately 94.1%[147] - The company has acquired scattered-site homes with year one nominal cap rates exceeding 5% and gross rental yields exceeding 9%[134] - In 2023, the company acquired Savannah-84, increasing ownership from 80% to 100%, with 18 units added[163] - In 2023, the company sold 1 unit of Golden Pacific in May and 1 unit in October, both with a 97% ownership interest[165] Growth Strategy - The company aims to achieve sustainable long-term growth in funds from operations (FFO) and net asset value (NAV) by assembling a portfolio of pre-existing single-family rental homes and developing build-to-rent communities targeting middle-income renters[152] - The company intends to sell properties opportunistically to harvest profits and reinvest proceeds, maximizing stockholder value[155] - The company plans to commence construction on the Abode Wendell Falls project in Q2 2024, with an estimated total project cost of $56.0 million, of which $6.5 million has been incurred as of December 31, 2023[163] Financial Management - The company has a $150 million revolving credit facility to meet primary liquidity requirements, which may limit its ability to fully execute its business plan[125] - The company has utilized mortgage and other indebtedness to finance operations, which increases business risk[126] - The fair value of mortgages payable is estimated at $93.0 million as of December 31, 2023[717] - The company has interest rate caps and swaps covering $94.0 million of its debt to manage interest rate risk[718] - The company evaluates operating performance based on NOI, which excludes corporate level expenses[174] REIT Compliance - The company is required to distribute at least 90% of its REIT taxable income to maintain its REIT status, failing which it would be subject to corporate-level taxation[143] - The company intends to maintain its REIT qualification by distributing at least 90% of its REIT taxable income[166] Operational Efficiency - The company plans to implement a technology-aided platform, including a data warehouse for real-time visibility into leasing and maintenance metrics, to enhance operational efficiency and drive net operating income (NOI) margin expansion[161] - The company has a stock repurchase plan in place to manage market risk[716] - The company’s disclosure controls and procedures were deemed effective as of December 31, 2023[721] Management and Risk Factors - The company has a limited operating history as a REIT, making future performance difficult to predict[132] - The company relies on key personnel from its external manager, and their departure could materially affect its business[137]