Financial Data and Key Metrics Changes - The company reported a healthy first quarter with core FFO per share exceeding the midpoint of guidance by $0.05, driven by a consolidated portfolio performance ahead of plan with same property revenues growing 3.4% year-over-year [11][12] - Blended net effective rent growth was 2.8% for the first quarter, with new lease rates improving sequentially from the fourth quarter [4][11] - Delinquency improved to 1.3% of scheduled rent in Los Angeles, down from 3.9% in the same period last year [4][11] Business Line Data and Key Metrics Changes - New lease rates turned positive in all three major regions, led by Northern California at 1.5%, Seattle at 1.3%, and Southern California at 0.2% [5] - The turnover rate was notably low at 35%, contributing to stable occupancy levels [4] - In April, renewal rates landed in the low fours, consistent with plans, while new lease rates remained steady [36][37] Market Data and Key Metrics Changes - Total new housing supply delivery as a percentage of stock in 2025 is exceptionally low at only 50 basis points in Essex markets, expected to moderate throughout the year [7] - Deal volume in the markets was higher in the first quarter compared to the same period last year, totaling $2.5 billion with cap rates in the mid to high 4% range [8] Company Strategy and Development Direction - The company is focused on reallocating capital into higher rent growth markets and optimizing its operating platform to generate above-market returns [3][4] - The company remains cautious about revising guidance due to macroeconomic uncertainties, particularly regarding U.S. and global trade policies [6][12] - The company is actively pursuing opportunities to enhance shareholder accretion while maintaining a disciplined investment strategy [10][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the West Coast multifamily fundamentals, stating they are well-positioned for a wide range of economic outcomes due to low supply [7][93] - The company noted that while the tech sector's job growth has been steady, it is closely monitoring potential impacts from macroeconomic changes [21][92] - Management highlighted that the labor market remains soft in Los Angeles, affecting pricing power, and emphasized the need for delinquency recovery to improve occupancy and pricing [60][61] Other Important Information - The company has refinanced the majority of its 2025 debt maturities and maintains over $1 billion in available liquidity [15] - The preferred equity portfolio saw around $27 million in redemptions, with expectations for further redemptions in the upcoming quarters [14] Q&A Session Summary Question: Guidance and Rate Growth - The company confirmed that the original guidance included a slight increase in blended rate growth in the second half of the year, and they remain confident in achieving this [17][19] Question: Impact of Tech Sector - Management indicated that job openings in the top 20 tech companies have remained steady, suggesting continued hiring in the sector [20][22] Question: Occupancy Strategy - The company is maintaining its occupancy strategy while pushing rents in Northern California, with a focus on occupancy in Southern California due to supply dynamics [25][27] Question: Renewal Rates - Renewal rates in April were steady, landing in the high threes, consistent with the company's plans [37] Question: Market Conditions in LA - Management noted that pricing power in LA depends on delinquency recovery and that the labor market remains soft, impacting overall performance [60][61] Question: Development and Investment Strategy - The company is actively looking for new investment opportunities but remains disciplined in its approach, focusing on long-term performance [64][111] Question: Concessions and Loss to Lease - Concessions have improved significantly from the fourth quarter to the first quarter, and loss to lease metrics have also shown improvement [113]

Financial Data and Key Metrics Changes - Same store NOI declined by 3.7% in the fourth quarter [12] - Same store revenue growth was negative 1.6% for the quarter, with occupancy levels dropping 120 basis points compared to last year [13] - FFO per share as adjusted was reported at $0.68 for the quarter, with a 2% increase in the quarterly dividend to an annualized $2.08 per share, representing a 4.9% dividend yield [14] Business Line Data and Key Metrics Changes - The year-over-year same store occupancy gap narrowed from negative 100 basis points at year-end 2024 to negative 50 basis points as of February [7] - Rents for new customer rentals improved their year-over-year negative gap from negative 10.3% in the fourth quarter to negative 7.4% recently [7] Market Data and Key Metrics Changes - Lower beta urban markets are outperforming the Sunbelt, with New York City expected to remain a bright spot [8] - The impact of new supply is expected to compete with approximately 24% of the same store portfolio, down from 27% last year [19] Company Strategy and Development Direction - The company is cautiously optimistic about the long-term health of the business, focusing on creative methods to grow externally [9] - The recent acquisition of an 80% interest in a joint venture is seen as a strategic move to bring properties onto the balance sheet [10][17] Management's Comments on Operating Environment and Future Outlook - Management noted that the last two years have been marked by overly optimistic forecasts regarding housing market improvements [9] - There is no near-term catalyst expected to sharply reaccelerate organic growth in 2025, with a focus on gradual improvements [8][9] Other Important Information - Real estate taxes grew by 17.5% in the fourth quarter compared to last year, influenced by significant refunds and tax reductions received in the previous year [13] - The company raised $85.6 million in net proceeds during the quarter through its ATM program to fund acquisitions [18] Q&A Session Summary Question: Inquiry about the JV transaction and future opportunities - Management indicated no imminent opportunities for other joint ventures, as the partner had a need-based motivation for selling [25][26] Question: Discussion on catalysts for demand acceleration - Management highlighted the need for clarity in mortgage rates and economic conditions to boost consumer confidence [32][34] Question: Concerns about potential street rate wars in 2025 - Management expressed cautious optimism, noting recent improvements in rates for new customers but emphasized the need for consistent trends [42][44] Question: Update on occupancy and performance trends - Management confirmed that occupancy levels have improved, with a negative gap of 50 basis points compared to last year [60] Question: Clarification on operating expenses and inflation - Management acknowledged that operating expenses are expected to run at inflationary levels, with no significant operational efficiencies anticipated [116]