1 Reason to Buy AvalonBay Communities (AVB)

Core Viewpoint - AvalonBay Communities is a leading residential REIT with a strong track record of dividend payments and shareholder value growth, making it an attractive investment for passive income seekers. Group 1: Company Overview - AvalonBay Communities operates nearly 95,000 apartment units across various states, focusing on major coastal markets and expanding metro areas in the Sunbelt region [1]. - The company has delivered an average annual total return of 11.7% since its IPO, driven significantly by its dividend payments [2]. Group 2: Dividend Performance - AvalonBay currently pays a quarterly dividend of $1.75 per share, amounting to an annual dividend of $7, with a 2.9% increase earlier this year and a total increase of nearly 300% since its IPO in 1993 [4]. - The company maintains a conservative payout ratio, allowing it to retain cash for new investments while supporting its dividend payments [4]. Group 3: Financial Strength and Growth Opportunities - AvalonBay has a robust balance sheet, providing flexibility for portfolio expansion and investment opportunities [4]. - The company recently acquired eight apartment communities in Texas for $618.5 million and has $3 billion in development projects planned for completion in the coming years [5]. - With $2.8 billion in liquidity, AvalonBay is well-positioned to fund additional growth investments as opportunities arise [5]. Group 4: Market Demand and Future Outlook - The existing apartment portfolio is expected to benefit from strong demand, leading to high occupancy levels and increased rental rates [6]. - Rising rents and portfolio growth are anticipated to drive above-average net operating income growth, supporting continued dividend increases [6].