Zacks Industry Outlook LifeStyle Properties, Veris Residential and UMH Properties

Industry Overview - The REIT and Equity Trust - Residential industry includes companies that own, develop, and manage residential properties such as apartment buildings, student housing, manufactured homes, and single-family homes [3] - Student housing properties are typically located near colleges and universities and are exclusively leased to students [4] - Demand for student housing is closely tied to enrollment growth at educational institutions [5] Market Dynamics - Elevated supply of new apartment units is creating pressure on rental rates despite strong demand [6] - The construction pipeline is depleting, suggesting promising occupancy and rent growth prospects in the coming years [7] - Increased use of concessions, particularly in lease-up assets, may drive higher renter turnover [8] - Healthy rental demand is supported by a strong labor market, favorable demographics, and high homeownership costs [9][10] Technological Initiatives - Residential REITs are adopting technologies like self-guided tours, digital move-ins, smart home systems, and AI-driven tools to enhance tenant experience and streamline operations [11] Industry Performance and Valuation - The REIT and Equity Trust - Residential industry has underperformed the broader Finance sector and the S&P 500, returning 6.1% compared to the S&P 500's 24.4% increase [15] - The industry is currently trading at a forward 12-month price-to-FFO ratio of 16.52X, below the S&P 500's forward 12-month P/E of 21.81X [16] Key Companies - Equity Lifestyle Properties: Focuses on manufactured home communities, RV resorts, and campgrounds, with a strategic advantage due to increasing demand and constrained supply [17][18] - Zacks Rank of 2 (Buy) with a 6.2% year-over-year increase in 2024 FFO per share estimate [19][20] - Veris Residential: Owns and operates multifamily rental properties in the Northeast, with a focus on technology-guided revenue optimization [21] - Zacks Rank of 2 with a 15.1% year-over-year increase in 2024 FFO per share estimate [22] - UMH Properties: Operates manufactured home communities across multiple states, benefiting from strong rental demand and a joint venture with Nuveen Real Estate [23][24][25] - Zacks Rank of 2 with an 8.1% year-over-year increase in 2024 FFO per share estimate [25]