Financial Data and Key Metrics Changes - The company reported a revenue growth of 2.1% for 2025, with a turnover rate of 41%, the lowest in its history [6][8] - The company raised $2.4 billion of capital at an initial cost of 5%, positioning for continued investment in 2026 [8][10] - The quarterly dividend was increased to $1.78 per share, reflecting a conservative payout ratio [10] Business Line Data and Key Metrics Changes - The company started $1.65 billion of projects in 2025 with a projected initial stabilized yield of 6.2% [7] - Development earnings are expected to uplift as projects lease up during 2026, with a forecasted revenue growth of 1.4% [9][10] - The company anticipates a same-store operating expense growth of 3.8% for 2026, driven by various factors including the phase-out of property tax abatement programs [21] Market Data and Key Metrics Changes - Revenue growth in New York and New Jersey is projected at roughly 2%, driven by contributions from New York City and Westchester [16] - The Mid-Atlantic region is expected to see just under 1% revenue growth, impacted by job losses in the back half of 2025 [18] - Northern California is projected to produce mid-3% revenue growth, supported by stable occupancy and lease rate growth [19] Company Strategy and Development Direction - The company aims to utilize its scale and investments in technology to drive incremental growth from its existing portfolio [9] - The focus for 2026 includes restraining new starts to $800 million, consisting of 7 projects with an average development yield of 6.5% to 7% [10][11] - The company is positioned to generate meaningful earnings and value creation as operating fundamentals improve and development earnings ramp into 2027 [14] Management's Comments on Operating Environment and Future Outlook - Management expects modest revenue growth of 1.4% in 2026, with job growth slightly stronger than in 2025 [9][11] - Demand for apartments is supported by rent-to-income ratios below 2020 levels, and the relative attractiveness of renting versus homeownership [12][13] - The supply outlook indicates only 80 basis points of stock this year in established regions, which is expected to serve as a tailwind [12][13] Other Important Information - The company raised almost $900 million of equity in 2024, the only one among peers to do so [7] - The company repurchased shares worth almost $490 million at an average price of $182 per share [8] - Legislative changes in Colorado and California are impacting the ability to charge certain fees, affecting other rental revenue [80][81] Q&A Session Summary Question: Renewal rates and expectations - Management indicated that renewal offers for February and March were in the 4%-4.5% range, with historical settlements typically lower [32] - The overall forecast for 2026 anticipates renewals averaging in the mid-3% range, with an expected improvement in move-ins [33][34] Question: Guidance lessons from 2025 - The company emphasized a detailed process for guidance, considering both upside and downside scenarios [45][46] - Development earnings are viewed as more concrete, with clarity on income rolling in from projects under construction [47] Question: Development starts and market conditions - The reduction in development starts is attributed to both a lack of suitable deals and a conscious decision to be cautious in a choppy environment [50][51] - The planned starts are heavily weighted towards established East Coast regions, which tend to have higher yields [53] Question: Impact of legislative changes - Management noted that legislation in Colorado and California is impacting revenue, with ongoing monitoring of potential ballot initiatives in Massachusetts [80][81] - The company is engaged with various associations to address legislative challenges and promote favorable outcomes [83]