UDR misses Q4 estimates on elevated supply than demand
06/02/2024 22:54
Feb 6 (Reuters) - Real estate investment trust UDR
UDR.N missed market estimates for funds from operation (FFO)
in the fourth quarter on Tuesday, a sign that higher supply than
demand weighed on rental growth rates.
Rental supply in the U.S. remains elevated, especially in
the Sunbelt region where supply is currently outstripping
demand.
The company said earlier on an earnings call it had been
providing concessions on rent in recent months, especially in
West Coast markets.
"Elevated new supply deliveries in 2024 suggest near-term
market rent growth will be more muted compared to long-term
averages," CEO Tom Toomey said.
Effective renewal lease rates stood at 4.2%, compared with
4.7% in the third quarter.
UDR posted FFO, a REIT performance key measure, at $0.61
per share in the quarter ended Dec. 31, versus analysts' average
estimate of $0.63 per share, according to LSEG data.
The Colorado-based REIT operates multifamily apartment
communities in the U.S. and has a portfolio of more than 50,000
apartment units in 21 markets.
The REIT expects full-year 2024 FFO to be in the range of
$2.36 to $2.48 per share, also below analysts' average estimate
of $2.49 per share, as per LSEG data.
Its effective new lease rates, offered to tenants moving
in, remained negative at 5.1% in the fourth quarter due to
seasonality and supply pressures.
(Reporting by Rupali Chaudhary and Ananta Agarwal in Bengaluru;
Editing by Shilpi Majumdar and Alan Barona)
((Rupali.Chaudhary@thomsonreuters.com;))