Udr, Inc. · NYSE:UDR
Udr — Investor Presentation (March 2022)
36 slides from Udr's investor presentation, Mar 3, 2022
Slide 1: Investor Presentation March 2022
INVESTOR PRESENTATION MARCH 2022 Vitrwvian West | Addison, TX , selling, | Joe Fisher, Chief Financial Officer| 720.283.6139 markets. Trent Trujillo, Investor Relations | 720.283.6135 UDR, INC. | UDR.COM. UDR, Inc. (NYSE: UDR) has a demonstrated history of successfully managi developing and redevelo
Slide 2: Table of Contents
TABLE OF CONTENTS , ane cerns : : . ‘ , NS 1 Jay “ KEY MESSAGES AND UPDATES UDR At a Glance Recent Updates REASONS TO INVEST IN UDR UDR Value Proposition Operating Competitive Advantages Operating Platform and Innovation Accretive Capital Allocation Diversified Portfolio Composition Market/Resident
Slide 3: UDR at a Glance
UDR AT A GLANCE”) UDR is a multifamily REIT that owns, operates, develops and redevelops a diversified portfolio of apartment homes across top-tier U.S. markets. Founded in 1972, UDR is an S&P 500 company that consistently generates strong total shareholder return (“TSR”) through innovation, best-in
Slide 4: Recent Updates
RECENT UPDATES UDR’s 1Q 2022 leasing trends have remained unseasonably strong. Below are key considerations for the quarter and FY2022: + 1Q22 blended lease rate growth expected to accelerate during the quarter and average 14%. + 10 trends point to upside to FY22 blended lease rate growth guidance o
Slide 5: Recent Update
RECENT UPDATE Irrespective of market rent growth, UDR’s future operating initiatives (continued innovation builds on our NextGen Operating Platform) and recent acquisitions continue to drive accretion and long-term value creation. INCREMENTAL NOI FROM OPERATING PLATFORM INITIATIVES ACQUISITIONS/EXTE
Slide 6: UDR Value Proposition
UDR VALUE PROPOSITIO UDR’s Value Proposition = continuous innovation + durable/repeatable operating and capital allocation competitive advantages versus peers > robust relative results across primary valuation metrics and long-term TSR outperformance. Durable/Repeatable Competitive Advantages NextGe
Slide 7: Operating Competitive Advantages
OPERATING COMPETITIVE ADVANTAGES UDR's operating prowess is key to our value proposition. Our strong operating abilities have repeatably generated long-term outperformance versus peers. As we continue to innovate in 2022 and beyond, we intend to expand our operational advantage. Operating Competitiv
Slide 8: Innovation 2.0 — Future Operating Initiatives
INNOVATION 2.0 — FUTURE OPERATING INITIATIVE Our NextGen Operating Platform 1.0 was successful in generating ~$15-$20 million of incremental NOI. We expect Innovation 2.0, which utilizes “big data” to drive decisions, outcomes, and further upside, to build on Platform and be much more impactful. Max
Slide 9: Operating Platform 1.0 Accomplishments
OPERATING PLATFORM 1.0 ACCOMPLISHMEN Platform 1.0 revolutionized how we conduct business with current and prospective residents through a self-service model. It has: 1. Improved resident satisfaction by 25%,()) 2. Produced the $15-$20M NOI upside underwritten in mid-2018, 3. Enhanced staffing effici
Slide 10: Accretive Capital Allocation
ACCRETIVE CAPI UDR has a strong track record of adhering to cost of capital signals from the public market. This discipline, combined with our expansive suite of investment options and extensive set of external growth value creation drivers, has driven robust returns for stakeholders over time. UDR’
Slide 11: Investment Opportunities: Acquisitions, Developer Capital Program, Development
a Station on Silver | Herndon, VA (Washington, DC MSA). + Target 10%-15%NOI growth above market + Acquired 26 third-party operating communities for $27 billion since 2019 + ~S0bps weighted average yield expansion on $12 billion third-party acquisitions in 2019-2020. DEVELOPER CAPITAL PROGRAM Essex L
Slide 12: Repeatable Value Creation
REPEATABLE VALUE CREATION ; Historical acquisitions best exhibit the outsized growth and value creation our competitive advantages can provide. We believe we can grow NOI at acquired properties by 10%-15% above market growth over the first three years of ownership. In 2019 and 2020, we acquired “$1.
Slide 13: Diversified Portfolio Composition
DIVERSIFIED PORTFOLIO COMPOSITIO Our diversified portfolio 1) is a differentiating factor versus peers, 2) appeals to a wide renter and investor audience, 3) provides for more markets to invest in / overlay our operating platform onto and 4) lessens volatility in long-term same-store growth. UDR’s p
Slide 14: Market / Resident Attributes
MARKET / RESIDENT ATTRIBUTES” UDR has a diversified and high-quality resident base across our markets. Our residents’ household income is on average 150% above the median income across the MSAs in which we operate, with a tilt toward high- and medium-income jobs. Resident credit quality has remained
Slide 15: Resident Attributes and Trends
RESIDENT ATTRIBUTES AND TREN Our diversified portfolio across markets, product types, and price points appeals to a wide variety of renters across various ages and other demographic traits. While the Millennial generation has garnered headlines for potential changes in their housing preferences, our
Slide 16: Strong, Liquid Balance Sheet
STRONG, LIQUID BALANCE SHEET UDR’s balance sheet is safe, liquid, flexible, and fully capable of supporting a wide variety of growth opportunities in size. We have improved our credit metrics, maturity profile, five-year liquidity outlook, and available LOC capacity. The efficient pricing these attr
Slide 17: Innovative Culture and ESG Leadership
INNOVATIVE CU RE AND ESG LEADERSHIP Reporting on our ESG initiatives and successes has expanded and improved over the past three years. Corporate Responsibility 47 GResB Named #1 listed Residential performer and 2021 Global_and —gLosicaL s + US" Regional Sector Leader by GRESB after achieving a scor
Slide 18: Innovative Culture and ESG Leadership
INNOVATIVE CULTURE AND ESG LEADERSHIP UDR’s culture is innovative, empowering and rewards success. Throughout the pandemic, UDR has proactively engaged with our associates and residents, supporting UDR’s near-maximum GRESB score in Social Responsibility. “S” — Social Responsibility: Associate Engage
Slide 19: Appendix
APPENDIX Arbors at Maitland Summit | Orlando, FL
Slide 20: The Case for Apartment REITs
THE CASE FORAPARTMENT REITS REITs have historically served as a strong inflation hedge and have direct exposure to primary drivers of the U.S. economy. Apartment REIT TSR has outperformed that of other REITs and the broader market by a wide margin over the past 20 years. This outperformance has been
Slide 21: Apartment Demographics and Fundamentals
APARTMENT DEMOGRAPHICS AND FUNDAMEN Long-term demographics remain strong for apartments. Domestically born cohorts aged 19 years and under are, on average, 605K people larger than the primary renter cohort aged 20-34 years. An expected improvement in immigration policies should support growth in the
Slide 22: Apartment Demographics and Fundamentals
APARTMENT DEMOGRAPHICS AND FUNDAMENTALS Strong trailing twelve-month (“TTM”) job growth and wage growth have bolstered personal balance sheets, supported household formation, and driven demand for housing. This, in turn, has supported strong rent growth for residential housing. Affordability (both r
Slide 23: Notes
NOTES
Slide 24: Forward Looking Statements
FORWARD LOOKING STATEMENTS a Forward Looking Statements Certain statements made in this presentation may constitute “forward-looking statements.” Words such as “expects,” “intends,” “believes,” “anticipates,” “plans,” “likely,” “will,” “seeks,” “estimates” and variations of such words and similar ex
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Slide 26: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS we Acquired Communities: The Company defines Acquired Communities as those communities acquired by the Company, other than development and redevelopment activity, that did not achieve stabilization as of the most recent quarter Adjusted Funds from Operations (“AFFO”)
Slide 27: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS ae Controllable Expenses: The Company refers to property operating and maintenance expenses as Controllable Expenses. Controllable Operating Margit The Company defines Controllable Operating Margin as (i) rental income less Controllable Expenses (i) divided by rental
Slide 28: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS a Effective Blended Lease Rate Growth: The Company defines Effective Blended Lease Rate Growth as the combined proportional growth as a result of Effective New Lease Rate Growth and Effective Renewal Lease Rate Growth. Management considers Effective Blended Lease Rate
Slide 29: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS aE Funds From Operations (“FFO”) attributable to common stockholders and unitholders: The Company defines FFO attributable to common stockholders and unitholders as net income/(loss) attributable to common stockholders (computed in accordance with GAAP), excluding imp
Slide 30: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS co Net Operating Income (“NOI”): The Company defines NOI as rental income less direct property rental expenses. Rental income represents gross market rent and other revenues less adjustments for concessions, vacancy loss and bad debt. Rental expenses include real esta
Slide 31: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS a Physical Occupancy: The Company defines Physical Occupancy as the number of occupied homes divided by the total homes available at a community. Proposition 13: In California, an amendment enacted in 1978 that limits the tax rate on real estate. The proposition decre
Slide 32: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS iat Stabi n/ Stabilized: The Company defines Stabilization/Stabilized as when a community's occupancy reaches 90% or above for at least three consecutive months: Stabilized, Non-Mature Communities: The Company defines Stabilized, Non-Mature Communities as those commun
Slide 33: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS ne 2022 Guidance: All guidance is based on current expectations of future economic conditions and the judgment of the Company's management team. The following reconciles from GAAP Net income/(loss) per share for frst quarter of 2022 and full-year 2022 to forecasted FF
Slide 34: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS Aso Quarter Ended Coverage Ratios December 31, 2021 Net income/(loss) s 126,144 Adjustments: Interest expense, including debt extinguishment and other associated costs 36,418 Real estate depreciation and amortization 163,755 Other depreciation and amortization 4713 Ta
Slide 35: Definitions and Reconciliations
DEFINITIONS AND RECONCILIATIONS aad ‘Three Months Ended Twelve Months Ended December 34, December 31, In thousands, except per share and unit amounts 2024 2020 2024 2020 Net incomel(loss) attrbutable to common stockhollers S$ t6403 5 asass $US se 08 Real estate deprecation and amertzaton 162.755 40.
Slide 36: Forward Looking Statements
Forward Looking Statements Certain statements made in this presentation may constitute “forward-looking statements.” Words such as “expects,” “intends,” “believes,” “anticipates,” “plans,” “likely,” “will” “seeks,” “estimates” and variations of such words and similar expressions are intended to iden