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Independence Realty Trust (IRT)

Independence Realty Trust is a real estate investment trust that owns and operates multifamily apartment properties across non-gateway U.S. markets, including Atlanta, Dallas, Louisville, Memphis, Raleigh and Tampa. IRT's investment strategy is focused on gaining scale within key amenity rich submarkets that offer good school districts, high-quality retail and major employment centers. IRT aims to provide stockholders attractive risk-adjusted returns through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation.

Company profile

Ticker
IRT
Exchange
CEO
Scott Schaeffer
Employees
Incorporated
Location
Fiscal year end
Former names
EMPIRE AMERICAN REALTY TRUST INC, INDEPENDENCE REALTY TRUST, INC
SEC CIK
Subsidiaries
Adley Craig Ranch Apartments Owner, LLC • Bayview Club Apartments Indiana, LLC • Bennington Pond Managing Member, LLC • Bennington Pond, LLC • Bridgeview Apartments, LLC • Brookside CRA-B1, LLC • Brunswick Point North Carolina, LLC • BSF Lakeshore, LLC • BSF Trails, LLC • Chelsea Square Apartments Holding Company, LLC ...
IRS number
264567130

IRT stock data

Investment data

Data from SEC filings
Securities sold
Number of investors

Calendar

28 Jul 22
1 Oct 22
31 Dec 22
Quarter (USD) Jun 22 Mar 22 Dec 21 Sep 21
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Annual (USD) Dec 21 Dec 20 Dec 19 Dec 18
Revenue
Cost of revenue
Operating income
Operating margin
Net income
Net profit margin
Cash on hand
Change in cash
Diluted EPS
Cash burn rate (est.) Burn method: Change in cash Burn method: Operating income Burn method: FCF (opex + capex)
Last Q Avg 4Q Last Q Avg 4Q Last Q Avg 4Q
Cash on hand (at last report) 42.4M 42.4M 42.4M 42.4M 42.4M 42.4M
Cash burn (monthly) 2.79M (no burn) 35.14M 4.67M (no burn) (no burn)
Cash used (since last report) 8.53M n/a 107.47M 14.28M n/a n/a
Cash remaining 33.87M n/a -65.08M 28.12M n/a n/a
Runway (months of cash) 12.1 n/a -1.9 6.0 n/a n/a

Beta Read what these cash burn values mean

Date Owner Security Transaction Code Indirect 10b5-1 $Price #Shares $Value #Remaining
18 May 22 Gebert Richard D Common Stock Grant Acquire A No No 0 3,597 0 28,068
18 May 22 Stephen R. Bowie Common Stock Grant Acquire A No No 0 3,597 0 6,522
18 May 22 Rio Ana Marie del Common Stock Grant Acquire A No No 0 3,597 0 54,291
18 May 22 Soaries DeForest B. Jr. Common Stock Grant Acquire A No No 0 3,597 0 46,483
18 May 22 Lisa Washington Common Stock Grant Acquire A No No 0 3,597 0 8,143
5.3% owned by funds/institutions
13F holders Current Prev Q Change
Total holders 362 385 -6.0%
Opened positions 53 74 -28.4%
Closed positions 76 67 +13.4%
Increased positions 125 153 -18.3%
Reduced positions 130 112 +16.1%
13F shares Current Prev Q Change
Total value 3.79B 5.89B -35.6%
Total shares 182.9M 190.74M -4.1%
Total puts 73.4K 649.8K -88.7%
Total calls 73.7K 49.6K +48.6%
Total put/call ratio 1.0 13.1 -92.4%
Largest owners Shares Value Change
Vanguard 32.32M $669.91M +32.8%
BLK Blackrock 30.3M $628.07M -23.2%
STT State Street 12.84M $267.81M +4.3%
Wellington Management 7.19M $148.99M -4.1%
MCQEF Macquarie 5.04M $104.59M +151.8%
Alliancebernstein 4.97M $103.11M +3.3%
DB Deutsche Bank AG - Registered Shares 4.54M $94.15M -12.3%
Geode Capital Management 4.45M $92.32M +11.0%
Long Pond Capital 3.96M $82.06M -37.6%
NTRS Northern Trust 3.42M $70.93M +25.3%
Largest transactions Shares Bought/sold Change
BLK Blackrock 30.3M -9.17M -23.2%
Vanguard 32.32M +7.99M +32.8%
MCQEF Macquarie 5.04M +3.04M +151.8%
Long Pond Capital 3.96M -2.38M -37.6%
Heitman Real Estate Securities 0 -2.26M EXIT
Healthcare Of Ontario Pension Plan Trust Fund 0 -1.46M EXIT
Cbre Clarion Securities 1.69M +1.06M +166.9%
FHI Federated Hermes 159.07K -826.43K -83.9%
Renaissance Technologies 2.18M -716.8K -24.7%
Millennium Management 0 -708.39K EXIT

Financial report summary

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Risks
  • You should carefully consider these risk factors, together with all of the other information included in this Annual Report on Form 10-K, including our consolidated financial statements and the related notes thereto, before you decide whether to make an investment in our securities. The Risk Factor Summary that follows should be read in conjunction with the detailed description of risk factors below. The risks set forth below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, prospects, financial condition, cash flows, liquidity, funds from operations, results of operations, stock price, ability to service our indebtedness, and/or ability to make cash distributions to our security holders (including those necessary to maintain our REIT qualification). In such case, the value of our common stock and the trading price of our securities could decline, and you may lose all or a significant part of your investment. Some statements in the following risk factors constitute forward looking statements. Please refer to the explanation of the qualifications and limitations on forward-looking statements under “Forward-Looking Statements” of this Form 10-K.
  • We are dependent on a concentration of our investments in a single asset class, making our results of operations more vulnerable to a downturn in the sector.
  • Adverse economic conditions may reduce or eliminate our returns and profitability and, as a result, our ability to make distributions to our stockholders.
  • We depend on residents for revenue, and vacancies, resident defaults or lease terminations may cause a material decline in our operating results.
  • Short-term resident leases expose us to the effects of declining market rent, which could adversely impact our ability to make cash distributions to our stockholders.
  • Our recently completed STAR Merger exposes us to a variety of risks.
  • Monetary policy actions by the U.S. Federal Reserve could adversely impact our financial condition and our ability to make distributions to our stockholders.
  • We will face competition from third parties, including other multifamily properties, which may limit our profitability and the return on any investment in our securities.
  • Our investment strategy may limit an increase in the diversification of our investments.
  • We may suffer from delays in locating suitable investments or, because of our public company status, may be unable to acquire otherwise suitable investments, which could adversely affect our growth prospects and results of operations.
  • If we fail to maintain an effective system of integrated internal controls, we may not be able to accurately report our financial results and may be required to incur additional costs and divert management resources.
  • If we are not able to cost-effectively maximize the life of our properties, we may incur greater than anticipated capital expenditure costs, which may adversely affect our ability to make distributions to our stockholders.
  • We face the risk of fluctuations in the cost, availability and quality of our materials and products, which could
  • adversely affect our results of operations.
  • Our growth will depend upon future acquisitions of multifamily communities, and we may be unable to complete acquisitions on advantageous terms or acquisitions may not perform as we expect.
  • Our investment in property development or redevelopment may be more costly or difficult to complete than we anticipate, and development and construction risks could adversely affect our profitability.
  • Our growth depends on securing external sources of capital that are outside of our control, which may affect our ability to take advantage of strategic opportunities, satisfy debt obligations and make distributions to our stockholders.
  • We may be subject to contingent or unknown uninsurable liabilities related to properties or businesses that we have acquired or may acquire for which we may have limited or no recourse against the sellers.
  • Representations and warranties made by us in connection with sales of our properties may subject us to liability that could result in losses and could harm our operating results and, therefore distributions we make to our stockholders.
  • We rely on information technology systems in our operations, and any breach or security failure of those systems could materially adversely affect our business, results of operations, financial condition and reputation.
  • A change in the United States government policy with regard to Fannie Mae and Freddie Mac could impact our financial condition.
  • Severe or inclement weather and climate change could result in losses to us.
  • We face numerous risks associated with the real estate industry that could adversely affect our results of operations through decreased revenues or increased costs.
  • Economic conditions may adversely affect the residential real estate market and our income.
  • The illiquidity of real estate investments could make it difficult for us to respond to changing economic, financial, and investment conditions or changes in the operating performance of our properties, which could reduce our cash flows and adversely affect results of operations.
  • Properties we purchase may not appreciate or may decrease in value.
  • We may incur liabilities in connection with properties we acquire.
  • Increasing real estate taxes, utilities and insurance costs may negatively impact operating results.
  • We may be unable to secure funds for property improvements, which could reduce cash distributions to our stockholders.
  • The profitability of our acquisitions is uncertain.
  • Acquiring or attempting to acquire multiple properties in a single transaction may adversely affect our operations.
  • If we sell properties by providing financing to purchasers, we will bear the risk of default by the purchaser.
  • Our revenue and net income may vary significantly from one period to another due to investments in value-add properties and portfolio acquisitions, which could increase the variability of our cash distributions.
  • We have acquired and are developing, and may continue to acquire or develop, properties through joint ventures, and any investment that we may make in joint ventures could be adversely affected by our lack of sole decision-making authority regarding major decisions, our reliance on our joint venture partners’ financial condition and ability to perform their obligations, any disputes that may arise between us and our joint venture partners and our exposure to potential losses from the actions of our joint ventures.
  • We plan to incur mortgage indebtedness and other borrowings and are not limited in the amount or percentage of indebtedness that we may incur, which may increase our business risks.
  • Lenders may require us to enter into restrictive covenants relating to our operations, which could limit our ability to make distributions to our stockholders.
  • Lenders may be able to recover against our other properties under our mortgage loans.
  • If we are required to make payments under any “bad boy” carve-out guaranties that we may provide in connection with certain mortgages and related loans, our business and financial results could be materially adversely affected.
  • Our variable rate indebtedness subjects us to interest rate risk, and interest rate hedges that we may obtain may be costly and ineffective.
  • Some of our outstanding mortgage indebtedness contains, and we may in the future acquire or finance properties with, lock-out provisions, which may prohibit us from selling a property, or may require us to maintain specified debt levels for a period of years on some properties.
  • Complying with REIT requirements may limit our ability to hedge risk effectively.
  • There is refinancing risk associated with our debt.
  • Some of our mortgage loans may have “due on sale” provisions, which may impact the manner in which we acquire, sell and/or finance our properties.
  • We may be adversely affected by changes in LIBOR reporting practices, the method in which LIBOR is determined or the use of alternative reference rates.
  • We are subject to significant regulations, which could adversely affect our results of operations through increased costs and/or an inability to pursue business opportunities.
  • The costs of compliance with environmental laws and regulations may adversely affect our net income and the cash available for any distributions.
  • Costs associated with addressing indoor air quality issues, moisture infiltration and resulting mold remediation may be costly.
  • We must comply with the Fair Housing Amendments Act of 1988 (the “FHAA”), and failure to comply could result in substantial costs.
  • We must comply with various federal, state, and local laws, ordinances and regulations enacted in response to the COVID-19 pandemic, and failure to comply which such laws could result in substantial costs or disruptions to our business.
  • The adoption of, or changes to, rent control, rent stabilization, eviction, tenants’ rights and similar laws and
  • regulations in our markets could have an adverse effect on our results of operations and property values.
  • Legislative or regulatory action could adversely affect the returns to our investors.
  • Dividends paid by REITs do not qualify for the reduced tax rates provided under current law.
  • We may decide to borrow funds to satisfy our REIT minimum distribution requirements, which could adversely affect our overall financial performance.
  • If we fail to maintain our qualification as a REIT, we will be subject to tax on our income, and the amount of distributions we make to our stockholders will be less.
  • To maintain our qualification as a REIT, we must meet annual distribution requirements, which may result in our distributing amounts that may otherwise be used for our operations.
  • Complying with REIT requirements may cause us to forgo otherwise attractive opportunities.
  • Certain of our business activities are potentially subject to the prohibited transaction tax, which could reduce the return on any investment in our securities.
  • If our operating partnership, IROP, is not treated as a partnership or disregarded entity for U.S. federal income tax purposes, its income may be subject to taxation.
  • Distributions to tax-exempt investors may be classified as unrelated business taxable income, or UBTI, and tax-exempt investors would be required to pay tax on such income and to file income tax returns.
  • Distributions to foreign investors may be treated as an ordinary income distribution to the extent that it is made out of current or accumulated earnings and profits.
  • Foreign investors may be subject to FIRPTA tax upon the sale of their shares of our stock.
  • Foreign investors may be subject to FIRPTA tax upon a capital gain dividend.
  • We may make distributions consisting of both stock and cash, in which case stockholders may be required to pay income taxes in excess of the cash distributions they receive.
  • Our stockholders may be restricted from acquiring or transferring certain amounts of our common stock.
  • The Maryland General Corporation Law prohibits certain business combinations, which may make it more difficult for us to be acquired.
  • Stockholders have limited control over changes in our policies and operations.
  • Our authorized but unissued shares of common and preferred stock may prevent a change in our control.
  • Because of our holding company structure, we depend on our operating partnership, IROP, and its subsidiaries for cash flow; however, we will be structurally subordinated in right of payment to the obligations of IROP and its subsidiaries.
  • Our rights and the rights of our stockholders to recover on claims against our directors are limited, which could reduce your and our recovery against them if they negligently cause us to incur losses.
  • Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders and provide that claims relating to causes of action under the Securities Act may only be brought in federal district courts, which could limit stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees and could discourage lawsuits against us and our directors, officers and employees.
  • If we are unable to retain or obtain key personnel, our ability to implement our investment strategies could be hindered, which could reduce our ability to make distributions and adversely affect the trading price of our common stock.
  • Sales of our common stock, or the perception that such sales will occur, may have adverse effects on our share price.
  • An increase in market interest rates may have an adverse effect on the market price of our common stock.
  • Some of our distributions may include a return of capital for U.S. federal income tax purposes.
  • Future issuances of debt securities, which would rank senior to our common stock upon liquidation, or future issuances of preferred equity securities, may adversely affect the trading price of our common stock.
  • The market prices for our common stock may be volatile.
Management Discussion
  • As of June 30, 2022, we owned and consolidated 120 multifamily apartment properties, of which 113 comprised the Combined Same-Store Portfolio. We discuss below, under "Non-GAAP Financial Measures," our methodology for categorizing our 120 properties, as applicable, into IRT Same-Store Portfolio (48 properties as of June 30, 2022), STAR Same-Store Portfolio (65 properties as of June 30, 2022) and Combined Same-Store Portfolio (113 properties as of June 30, 2022). Because of substantial changes in our total property portfolio as the result of the STAR Merger that closed on December 16, 2021, the financial data presented below show significant changes in revenue and expenses from period-to-period.

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