Veris Residential(US:VRE)2025-10-23 13:30Financial Data and Key Metrics Changes - The company reported blended net rental growth of 3.9%, significantly outperforming the national market, with core FFO per share of $0.20, an increase of $0.03 from the previous quarter [3][16] - Core FFO year-to-date is $0.52 per share, compared to $0.49 at the same time last year [16] - Net income available to common shareholders was $0.80 per fully diluted share, reflecting substantial gains from sales during the quarter versus a loss of $0.10 for the prior year [16] Business Line Data and Key Metrics Changes - Same store blended net rental growth rate was 3.9% for the quarter, with 3.6% growth in new leases and 4.3% in renewals [11] - Average revenue per home increased to $4,255, over 40% premium compared to peers [11] - Occupancy rate was 95.8% excluding Liberty Towers, and overall occupancy was 94.7% [12] Market Data and Key Metrics Changes - The national multifamily market remains structurally undersupplied, but demand has weakened in select markets due to new supply [4][5] - New York City led the nation in rental growth at 4.8%, supported by limited supply [5] - The Jersey City Waterfront maintained low vacancy levels and rental growth of almost 3% [7] Company Strategy and Development Direction - The company is focused on monetizing select non-strategic assets, raising the sales target from $500 million to $650 million [3][4] - The strategy aims to enhance optionality and explore a wider range of financing strategies, potentially reducing the cost of capital [4] - Continued divestment of non-strategic assets is expected to strengthen the balance sheet and drive earnings growth [3][4] Management's Comments on Operating Environment and Future Outlook - Management noted that softening labor markets and declining consumer sentiment could present headwinds to the sector [5] - The company raised core FFO guidance for the second consecutive quarter to $0.67 to $0.68 per share, reflecting robust year-over-year growth of 12% to 13% [21][22] - The outlook remains positive, with expectations of continued operational performance and strategic asset sales [22] Other Important Information - The company improved its GRESP score by one point to 90, maintaining a five-star rating and ranking first in its peer group [10] - The company has reduced net debt to EBITDA by 15% since the beginning of the year to 10 times [3][20] Q&A Session Summary Question: Follow-up on store guidance ranges - Management explained that Q3 same store NOI growth was an anomaly due to non-controllable expenses and expects to remain within guidance range for Q4 [25][26] Question: Visibility into rental revenue - Management confirmed strong visibility into renewals with only 5% of NOI outstanding to renew, and renewal rates are expected around 4% to 5% [27] Question: Leverage target and future focus - The focus remains on executing the current plan while continuing operational improvements, with potential for further amendments in the future [31][32] Question: Buyer pool for asset sales - Management noted a broader buyer pool for smaller assets, but larger sales have seen a thinner buyer pool [33] Question: Disposition guidance and asset sales - The increase in sales guidance reflects both improved market conditions and the evaluation of additional assets for sale [39][52]