Key Takeaways Invitation Homes reported Q4 core FFO of $0.48 per share, up from $0.47, with revenues up 4%.INVH lifted same-store NOI 0.7% on 1.7% revenue growth as occupancy slipped 90 basis points.Invitation Homes sees 2026 core FFO of $1.90-$1.98 per share; consensus stands at $1.99.Invitation Homes Inc. (INVH) reported fourth-quarter 2025 core funds from operations (FFO) per share of 48 cents, meeting the Zacks Consensus Estimate. This compared favorably with the FFO per share of 47 cents a year ago.The ...

Core Viewpoint - REITs are regaining favor as a safe haven investment, showing a year-to-date increase of 6.9% compared to a broader market decline [1] Group 1: Market Dynamics - The turning point for market sentiment occurred in early February, coinciding with a reversal of previously hot trades and a focus on significant capital expenditure (capex) by hyperscalers during earnings season [3] - Major tech companies like Microsoft, Google, and Amazon experienced declines of 5%, 10%, and 18% respectively, contributing to a 4% drop in the Nasdaq and a 2% drop in the S&P in the first two weeks of February [7][8] - Traditional safe havens, including gold and silver, have not performed well, leading investors to consider REITs as a more reliable option [9][11] Group 2: REITs' Fundamental Strength - REITs have demonstrated strong fundamental performance over the past five years, with metrics such as FFO (Funds From Operations) growth and improved margins [13][16] - The median REIT trades at 13.8X FFO, significantly lower than the S&P's 29.3X trailing earnings, indicating a divergence in valuation [21] - REITs currently offer an FFO yield of 7.24%, compared to the S&P's earnings yield of 3.4%, allowing for larger dividend payouts [24] Group 3: Cash Flow Reliability - REITs benefit from contractual revenue streams that can extend up to 30 years, providing visibility into future cash flows and supporting consistent dividend growth [17][19] - A forecast indicates that 36 REITs are expected to increase their dividends in the first quarter of 2026, reflecting their reliable cash flow structure [17] Group 4: Direct Benefits from Tech Capex - Many REITs are positioned to benefit directly from the trillions of dollars being spent on AI infrastructure, with companies like Equinix reporting accelerating growth in AFFO per share due to increased demand for data centers [29] - The demand for infrastructure related to AI is driving significant growth opportunities for REITs, contrasting with the challenges faced by hyperscalers [29] Group 5: Market Correction and Future Outlook - The current market correction is seen as a recalibration of previously inflated tech valuations, with capital shifting towards undervalued sectors like REITs [32][33] - The outperformance of REITs in 2026 is viewed as just the beginning, with expectations for further normalization of relative value as the market adjusts [33]

Core Insights - UDR has proactively shifted approximately 25% of its Q4 lease expirations to higher-demand months in 2026 to prepare for the typical fourth-quarter slowdown [1] - The company experienced a significant improvement in lease rate growth since October, with new lease rate growth increasing by 550 basis points and renewals by 300 basis points [2] - UDR anticipates blended lease rate growth of 1.5% to 2% on average in 2026, which is about 100 basis points higher than in 2025, driven by a reduction in supply completions [4] Company Performance - UDR built occupancy to nearly 97% despite a weakening demand in late Q3, with new lease growth falling to negative 8% and renewals at 2% in October [2] - The positive operating momentum from late 2025 has continued into 2026, with further acceleration in lease rate growth and high occupancy levels [3] - The company expects full-year 2026 same-store revenue growth to fall between 0.25% to 2.25%, with blended lease rate growth contributing approximately 80 basis points [4] Market Outlook - UDR's management sees several tailwinds for 2026, including a decrease in apartment completions, which is expected to lead to rent price acceleration in the Sun Belt [5] - Rent-to-income ratios for UDR's renters are below the long-term average, indicating that residents can comfortably accept rent increases [6]

Core Viewpoint - UDR, Inc. has underperformed the broader market due to sector-specific challenges and slowing rental demand, despite a strong earnings surprise history and a moderate buy consensus from analysts [2][4][5]. Company Overview - UDR, Inc. is a publicly traded apartment real estate investment trust (REIT) based in Highlands Ranch, Colorado, focusing on high-demand multifamily communities across major U.S. metropolitan markets [1]. - The company has a market capitalization of $12.4 billion and derives most of its revenue from rental income [1]. Stock Performance - Over the past year, UDR's stock has declined by 12.1%, while the S&P 500 Index has increased by nearly 12.2% [2]. - Year-to-date, UDR's stock is up 1.2%, contrasting with a slight decline in the S&P 500 [2]. Competitive Analysis - UDR has also lagged behind the Residential REIT ETF (HAUS), which has seen a 5% decline over the past year [3]. - The ETF's year-to-date performance has been better than UDR's, indicating competitive pressures in the market [3]. Revenue and Growth Expectations - For FY2025, analysts project UDR's FFO per share to grow by 2.4% to $2.54 on a diluted basis [5]. - The company has consistently beaten or matched consensus earnings estimates in the last four quarters [5]. Analyst Ratings - Among 23 analysts covering UDR, the consensus rating is a "Moderate Buy," consisting of eight "Strong Buy" ratings, 13 "Holds," and two "Strong Sells" [5]. - Recent analysis from Goldman Sachs maintained a "Sell" rating but raised the price target from $33 to $37.50, reflecting a 13.64% increase in valuation expectations [6].

Core Viewpoint - Equity Residential (EQR) is expected to report growth in revenues and funds from operations (FFO) per share for the fourth quarter and full year of 2025, despite a softening apartment market [1][7]. Company Performance - In the last reported quarter, Equity Residential achieved an in-line performance for normalized FFO per share, with increases in same-store revenues and physical occupancy year-over-year [2]. - Over the past four quarters, Equity Residential surpassed the Zacks Consensus Estimate once and met expectations three times, with an average positive surprise of 0.54% [2]. Market Conditions - The US apartment market experienced a softening in fundamentals during Q4 2025, with net move-outs of approximately 40,400 units, marking the first seasonal pullback in three years [3]. - A total of about 409,500 units were delivered in 2025, contributing to elevated competition and a decline in occupancy to 94.8% [4]. - Effective asking rents decreased by 1.7% quarter-over-quarter and 0.6% year-over-year, with over 23% of units offering incentives averaging 7% [4]. Projections for Equity Residential - For Q4 2025, same-store revenues are projected to increase by 2.6% year-over-year, with same-store net operating income (NOI) expected to grow by 2.3% [7]. - The Zacks Consensus Estimate for quarterly revenues is $789.34 million, with normalized FFO per share anticipated in the range of $1.02-$1.06, indicating a 4% year-over-year growth [8][9]. - For the full year 2025, normalized FFO per share is expected to be between $3.98-$4.02, with same-store revenue growth projected at 2.5-3.0% [9][10]. Financial Position and Strategy - Equity Residential's strategic portfolio diversification across urban and suburban markets, along with a focus on higher-income renters, is expected to support its performance amid current market pressures [6]. - The company maintains a strong balance sheet and leverages technology and operational efficiency to drive growth [6].

Core Insights - Camden Property Trust (CPT) is expected to report fourth-quarter 2025 results on February 5, with anticipated revenue growth year-over-year, although funds from operations (FFO) per share may remain flat [1][8]. Industry Overview - The U.S. apartment market experienced a softening in fundamentals during Q4 2025, with net move-outs of approximately 40,400 units, marking the first seasonal pullback in three years [3]. - Full-year absorption reached just over 365,900 units, indicating a shift back to long-term leasing trends rather than a demand collapse [3]. - Supply pressures remain significant, with around 409,500 units delivered in 2025, including about 89,400 in Q4, leading to increased competition [4]. - Occupancy rates fell to 94.8%, and effective asking rents decreased by 1.7% quarter-over-quarter, with a year-over-year decline of 0.6% in 2025 [4]. Company Performance - In the last reported quarter, Camden Property Trust achieved an FFO per share of $1.70, exceeding the Zacks Consensus Estimate by 0.59%, driven by higher same-property revenues and effective blended lease rates, despite increased interest expenses [2]. - For Q4 2025, the Zacks Consensus Estimate for CPT's revenues is $394.9 million, reflecting a growth of 2.2% from the previous year [7]. - Camden's core FFO per share estimate remains at $1.73, unchanged from the prior year, with expectations for Q4 ranging between $1.71 and $1.75 [9][8]. Market Dynamics - The apartment market's performance is uneven, with supply-heavy regions like Austin, Phoenix, and Denver facing the most significant rent pressures, while coastal and tech-oriented areas like New York and San Francisco continue to see rent growth due to tighter supply [5]. - Camden is expected to benefit from its presence in high-growth markets and a strong resident base, which may help maintain steady rental revenues [6]. - However, the elevated supply of rental units in certain markets is likely to increase competition, hindering rent growth and negatively impacting bottom-line performance [7].

Core Insights - Essex Property Trust, Inc. (ESS) is expected to report its Q4 and full-year 2025 results on February 4, with anticipated year-over-year growth in revenues and core funds from operations (FFO) per share [1][10] Company Performance - In the last reported quarter, Essex Property achieved a core FFO per share surprise of 0.25%, driven by growth in same-property revenues and net operating income (NOI), although higher operating and interest expenses dampened results [2][10] - Over the past four quarters, Essex Property's earnings have consistently exceeded the Zacks Consensus Estimate, with an average surprise of 0.76% [3] Market Conditions - The US apartment market showed signs of softening in Q4 2025, with net move-outs of approximately 40,400 units, marking the first seasonal pullback in three years [4] - Supply pressures remain significant, with about 409,500 units delivered in 2025, including 89,400 in Q4, leading to a decline in occupancy to 94.8% and a 1.7% decrease in effective asking rents quarter-over-quarter [5] - Coastal and tech-oriented markets like New York and San Francisco continue to experience modest rent growth, while supply-heavy markets such as Austin and Phoenix face more significant rent pressures [6] Projections and Estimates - The Zacks Consensus Estimate for Essex Property's Q4 revenues is $476.57 million, reflecting a 4.86% year-over-year increase, with same-property revenues estimated at $414.75 million [9][10] - For Q4 2025, core FFO per share is projected to be between $3.93 and $4.03, with the consensus estimate remaining at $4.00, indicating a 2.04% year-over-year increase [11] - For full-year 2025, core FFO per share is expected to be in the range of $15.89 to $15.99, with a consensus estimate of $15.97, representing a 2.37% year-over-year increase on revenues of $1.88 billion [12] Challenges Ahead - Essex Property may face leasing challenges in Q4 due to elevated supply impacting rent growth and occupancy, alongside persistent higher interest expenses [8][10]

Core Insights - AvalonBay Communities, Inc. (AVB) is set to announce its fourth-quarter and full-year 2025 results on February 4, with a previous negative surprise of 2.14% in core funds from operations (FFO) per share in the last quarter, attributed to weaker-than-expected top-line growth [1][2] Company Performance - Over the past four quarters, AvalonBay's earnings have surpassed the Zacks Consensus Estimate twice, with an average negative surprise of 0.36% [2] - The Zacks Consensus Estimate for fourth-quarter revenues is $768.33 million, indicating a year-over-year increase of 3.75% [10] - The consensus for same-store economic occupancy is projected at 95.65% for the fourth quarter [10] - The quarterly core FFO per share estimate has been revised down by 2 cents to $2.84, reflecting a year-over-year growth of 1.43% [11] Market Conditions - The US apartment market experienced a softening in fundamentals during the fourth quarter of 2025, with net move-outs of approximately 40,400 units, marking the first seasonal pullback in three years [3] - Full-year absorption totaled over 365,900 units, indicating a return to long-term leasing trends rather than a demand collapse [3] - Approximately 409,500 units were delivered in 2025, with 89,400 units in the fourth quarter, leading to increased competition despite a slowdown in completions [4] Financial Outlook - AvalonBay has lowered its core FFO per share growth outlook to 2.2% from 3.5%, with same-store residential NOI growth reduced to 2% from 2.7% due to lower revenue growth and higher expense growth [7] - The company has faced challenges from lower-than-expected job growth, leading to revenue moderation and higher operating costs in the second half of 2025 [8] - For full-year 2025, the Zacks Consensus Estimate for core FFO per share has been revised down by 3 cents to $11.24, indicating a year-over-year increase of 2.09% on revenues of $3.04 billion [12] Competitive Landscape - Market performance remains uneven, with supply-heavy Sun Belt markets experiencing the steepest rent pressure, while coastal and tech-oriented metros continue to see rent growth due to tighter supply [5] - AvalonBay's near-term outlook has moderated amid decelerating rent growth and rising expenses, but a solid balance sheet and limited upcoming supply in core markets position the company for long-term stability [6]

This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Dive Brief: Parkview Financial REIT has foreclosed upon a new 102-unit residential property at 1919 Market St. in West Oakland, California, after a loan failure, SiliconValley.com reported on Jan. 15. The outlet reported that an affiliate of the property’s developer, oWow, lost the asset through foreclosure. At that time, the unpaid debt was $58.5 million. ...

Core Thesis - UDR, Inc. is viewed positively due to its strong operational performance and attractive valuation compared to peers, despite recent stock price declines [1][3][7] Company Overview - UDR, Inc. is a US-focused apartment REIT that operates primarily in supply-constrained coastal markets, positioning it well for future growth [2] - As of January 13th, UDR's share price was $36.13, with trailing and forward P/E ratios of 82.27 and 55.56 respectively [1] Financial Performance - UDR has delivered solid operating results, showing some of the strongest same-property income growth in its peer group [4] - The company has a current dividend yield of approximately 4.7% and has maintained over twenty years of consecutive dividend growth [5] Valuation and Market Position - UDR's stock trades at the lowest valuation among its peers, with an implied cap rate above 6% and an estimated 30% discount to net asset value [3] - The REIT sector is experiencing a broader mispricing, with public REITs trading at higher implied cap rates compared to private market transactions [6] Future Outlook - As supply pressures ease, rent growth is expected to reaccelerate, enhancing UDR's income profile [5] - The current market conditions, including declining interest rates, may lead to increased interest in income-generating assets, positioning UDR for significant upside potential [7]