This story was originally published on Multifamily Dive. To receive daily news and insights, subscribe to our free daily Multifamily Dive newsletter. Dive Brief: As of the third quarter of 2025, multifamily delinquencies reached 1.37%, its highest level since the global financial crisis era in 2010, according to new CRED iQ data reported by community, commercial and savings banks. Loans 90 days or more past due, which CRED iQ considers serious delinquencies, represent the overwhelming majority of stresse ...

Group 1 - LaSalle Investment Management focuses on partnering with experienced operators for value-add investments in U.S. housing markets, targeting well-located multifamily assets for operational improvements and long-term value creation [3][4] - In July 2023, LaSalle and UDR formed a joint venture worth $510 million to acquire high-quality communities with operational upside, which expanded to $850 million by December 2025 [5] - UDR will maintain 51% ownership of the contributed apartment communities and will leverage the joint venture's total debt to approximately 33% [6] Group 2 - UDR is set to receive around $200 million in cash from the joint venture transaction, which will be allocated for share repurchases, debt repayment, and general corporate purposes [7] - LaSalle completed a $250 million co-investment with Cortland Enhanced Value Fund VI into a portfolio of 19 multifamily properties acquired for $1.6 billion, supporting value-add repositioning [8] - The investment represents 34% of the equity in a nearly 6,000-unit portfolio located in metro Atlanta, Washington, D.C., and Northern Virginia, with Cortland managing the properties [8]

Financial Data and Key Metrics Changes - The company reported net income of $2 million, or $0.03 per unit, and cash available for distribution (CAD) of $4.6 million, or $0.20 per unit for Q3 2025 [14] - Book value per unit increased to $12.36, up $0.53 from June 30, primarily due to an increase in unrealized gains on the mortgage revenue bond portfolio [15] - The closing unit price was $8.24, representing a 33% discount to the book value per unit as of September 30 [16] Business Line Data and Key Metrics Changes - Fiscal occupancy for the stabilized mortgage revenue bond portfolio was 87.8% as of September 30, down from 88.4% as of June 30, mainly due to higher vacancies in Texas [5][6] - The company has 11 current investments, with 7 completed and leasing, 2 nearly completed, and 2 in future development [6][8] - The joint venture equity investments portfolio had a carrying value of approximately $154 million as of September 30, with remaining funding commitments totaling $19.5 million [20] Market Data and Key Metrics Changes - The U.S. municipal bond market saw improvement, with 10-year MMD decreasing from 3.21% to 2.92% and 30-year MMD from 4.58% to 4.24% during Q3 2025 [25] - The trend of heavy municipal bond issuance continued, with high fund flows into the muni market [25] - The company noted that only 9% of its debt investments are secured by projects receiving Section 8 subsidies, which may be impacted by the federal government shutdown [26] Company Strategy and Development Direction - The company plans to reduce capital allocation to joint venture equity investments in market-rate multifamily properties and focus more on tax-exempt mortgage revenue bonds [10][11] - The strategy aims to provide more stable earnings and increase the proportion of tax-exempt income allocated to unit holders [12] - The company remains positive on the market-rate seniors' housing segment and will continue to evaluate investment opportunities in that area [9] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that higher interest rates and multifamily capitalization rates are negatively impacting asset values and returns on sales [9] - The company expects occupancy levels to recover as new supply deliveries decline and available units are absorbed [6] - Management is assessing the potential impact of the strategic shift on short-term and long-term earnings expectations and unit holder distributions [13] Other Important Information - The company reported no forbearance requests for mortgage revenue bonds and governmental issuer loans, with all borrowers current on payments as of September 30 [19] - The company issued Series B preferred units for gross proceeds of $5 million in October 2025 to support investment commitments and operations [16][24] Q&A Session Summary Question: Capital allocation targets for multifamily units - Management indicated that future capital allocation will depend on the timing of capital returns from existing joint venture equity exits and current opportunities, with no set percentage at this time [30] Question: Expected pace of asset sales and occupancy stabilization - Management noted that the timeline for sales may be extended due to slower leasing activity in Texas and the need to reach critical occupancy levels before listing properties for sale [32] Question: Strategic shift away from joint venture investments and expected earnings pickup - Management highlighted the benefits of reduced earnings volatility and increased tax-exempt income from new investments, but stated it is too early to provide specific guidance on earnings pickup [35] Question: Cap rates for senior housing investments - Management clarified that they did not purchase properties during low cap rate periods but invested in to-be-built properties, and they continue to evaluate opportunities based on risk-adjusted returns [41][42] Question: Provision for credit losses despite improving municipal bond market - Management explained that the provision for credit losses was related to specific underperforming properties, and the overall portfolio quality remained consistent [50][54]

Group 1 - Manulife IM and TruAmerica have launched a $1 billion joint venture named Anchor Point Residential to address the need for affordable housing in the U.S. [7] - The venture aims to acquire high-quality, income-restricted assets backed by Low-Income Housing Tax Credits, focusing on a geographically diverse portfolio [7] - The initial acquisition includes a 6,000-unit portfolio of 51 properties built between 2003 and 2023, located in major metro areas of California, Texas, and Washington [7] Group 2 - Manulife IM emphasizes its commitment to increasing access to affordable housing and capitalizing on favorable fundamentals in the housing sector [3] - The partnership is seen as a strategic move to leverage complementary strengths and operational expertise between Manulife IM and TruAmerica [5] - The affordable housing sector is viewed as resilient and capable of providing stable, durable returns, despite volatility in the market-rate transaction environment [4][6]

Core Insights - Mid-America Apartment Communities, Inc. (MAA) reported strong operating results for Q2 2025, with Core FFO results exceeding expectations despite macroeconomic uncertainties [3][4] - The company experienced record demand for rental housing, leading to a 0.5% growth in Same Store effective blended lease rates and a 100 basis point improvement in Same Store blended pricing [3][5] - MAA's development pipeline is nearing $1 billion, which is expected to support robust revenue and earnings performance [3][4] Financial Performance - For the three months ended June 30, 2025, MAA reported earnings per diluted share of $0.92, up from $0.86 in the same period of 2024 [2][25] - Funds from operations (FFO) per diluted share increased to $2.19 from $2.06 year-over-year, while Core FFO per diluted share decreased slightly to $2.15 from $2.22 [2][25] - Total rental and other property revenues for Q2 2025 were $549.9 million, compared to $546.4 million in Q2 2024 [25] Same Store Operating Results - Same Store revenues decreased by 0.3%, while expenses increased by 3.8%, resulting in a 2.6% decline in Net Operating Income (NOI) for Q2 2025 compared to Q2 2024 [4][5] - The average effective rent per unit for Same Store properties was $1,690, with a physical occupancy rate of 95.4% [6][5] - Resident turnover in the Same Store Portfolio remained low at 41.0%, with only 11.0% of move-outs attributed to purchasing single-family homes [5][6] Development and Lease-up Activity - MAA has eight communities under development with total expected costs of $942.5 million, and recently began construction on a 336-unit multifamily apartment community in Charleston, South Carolina [5][8] - As of June 30, 2025, MAA had six lease-up projects with a total of 2,101 units and a physical occupancy rate of 80.7% [9][5] - Three of the lease-up projects are expected to stabilize in Q3 2025, while two are projected for Q4 2025 and one for Q2 2026 [9][5] Balance Sheet and Financing - As of June 30, 2025, MAA had $1.0 billion in combined cash and available capacity under its unsecured revolving credit facility [11][12] - Total debt was reported at $5.048 billion, with a total debt to adjusted total assets ratio of 28.9% [12][26] - The company declared its 126th consecutive quarterly common dividend, with an annual dividend rate of $6.06 per common share [13][25] 2025 Guidance - MAA updated its 2025 guidance, expecting earnings per diluted common share to range from $5.51 to $5.83 and Core FFO per diluted share to range from $8.61 to $8.93 [16][14] - The company anticipates Same Store property revenue growth between -0.35% to 1.15% and NOI growth between -2.15% to -0.15% for the year [16][14]