Camden(US:CPT)2023-04-28 18:26Financial Data and Key Metrics Changes - Same-property revenue growth for Q1 2023 was 8%, exceeding expectations, leading to an increase in the midpoint of 2023 revenue guidance [6][56] - Core FFO and NAREIT FFO for Q1 2023 were reported at $1.66 per share, a 12% increase from Q1 2022 [28] - The balance sheet remains strong with a net debt to EBITDA ratio of 4.3x at the end of Q1 2023 [15] Business Line Data and Key Metrics Changes - New development lease-ups showed strong performance with Camden Atlantic averaging approximately 45 leases per month, Camden NoDa at 40 leases per month, and Camden Tempe II at 30 leases per month [9] - Renewal offers for May and June were sent out in the mid-6% range, indicating a slight moderation from previous record levels [7] Market Data and Key Metrics Changes - The highest growth rates were observed in Florida markets: Tampa, Orlando, and Southeast Florida, with Nashville also performing strongly [24] - Occupancy averaged 95.3% during Q1 2023, with a slight improvement in April [25] Company Strategy and Development Direction - The company anticipates a significant reduction in new development starts, projecting a 60% drop due to the impact of Federal Reserve policies and the banking crisis [23][64] - The company is positioned to take advantage of potential market opportunities in 2025 and 2026 due to a strong balance sheet and existing development pipeline [38][64] Management's Comments on Operating Environment and Future Outlook - Management noted that multifamily transactions have slowed dramatically, with activity down 74% from the previous year [5] - The company expects to see a return to normal seasonality in leasing activity, with overall market rent growth anticipated to be slightly above 3% for the year [75] Other Important Information - The company has updated its insurance expense forecast, now expecting a 35% increase in total insurance expenses for 2023 [14][31] - The company plans to contest property tax valuations, anticipating a reduction in property tax expectations [133] Q&A Session Summary Question: What is the outlook for rent growth in April compared to Q1? - Management indicated that April's rent growth moderated to 3.9% from 4.5% but expected normal seasonality to return [16] Question: Which market is underperforming? - Atlanta was identified as underperforming due to elevated skips and evictions, along with challenges related to fraud [36] Question: What is the expectation for bad debt impact in 2023? - The original expectation was about 140 basis points for the full year, now updated to approximately 120 basis points [48] Question: How is the company positioned for future acquisitions? - The company is well-positioned with a strong balance sheet and anticipates opportunities as cap rates adjust [102][103] Question: What is the company's stance on concessions? - The company does not typically use concessions except in new lease-ups, maintaining a pricing discipline [106] Question: How does the company view the competitive landscape in Houston? - Management believes Houston will experience steady growth despite supply challenges, with a strong rental rate increase of 6.4% in Q1 [99][100]