Apartment Income REIT Corp. (NYSE: AIRC), also known as A.I.R., recently announced results for the quarter that ended on June 30, 2021. The company also announced an increase to full-year Same-Store Revenue, FFO, and N.O.I. guidance.
High consumer demand
The company’s C.E.O., Terry Considine, commented that business is good, and robust consumer demand is hiking rent prices. In addition, the efficiency of the A.I.R. business model is confirmed with peer-best-operating margins, low corporate G&A, leading to a $5 increase in full-year FFO guidance.
Terry adds that asking rents are now higher than their pre-COVID 19 peaks and are above their long-term trend. In addition, growing consumer demand and strong execution drove signed new rates up 2.7% in the second quarter.
The company is on track to meet leverage goals. In April, they issued$342 million of equity and used the proceeds to reduce debt. Terry continues by saying that the company expects similar proceeds from the third quarter’s activity to sell their Chicago and New York properties and a similar amount from the fourth quarter’s activities to sell properties outright or to joint ventures, with all proceeds applied to debt reduction.
A.I.R. upgraded its portfolio with the $223 million purchase of City Center on 7th, a 700- apartment home community in Pembroke Pines, Florida. The company plans to increase 4Q2021 property sales so that the purchase is funded on a leverage-neutral basis.
Things are looking good.
Terry believes that the company is well-positioned for an excellent second half 2021 and an even better 2022, adding that their current loss to lease of 10% suggests double-digit revenue growth. In addition, the company’s C.F.O. Paul Beldin says the second quarter FFO per share of $0.52 was $0.02 above the high-end of their guidance range due to better than anticipated property operations and lower than anticipated costs.
He adds that with 80% of 2021 anticipated leasing activity completed, the company expects a full-year Same-Store N.O.I. growth between (0.50%)and 1.00%. With Same Store property operations contributing an additional $0.8 to FFO per share at the midpoint.