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NXRT NexPoint Residential Trust

Participants
Jackie Graham Investor Relations
Brian Mitts Executive Vice President and Chief Financial Officer
Matt McGraner Executive Vice President and Chief Investment Officer
Buck Horne Raymond James
Tayo Okusanya Mizuho
Drew Babin Baird
John Massocca Ladenburg Thalmann
Barry Oxford D.A. Davidson
Craig Kucera B. Riley FBR
Rob Stevenson Janney
Call transcript
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Operator

Good day, and welcome to the NexPoint Residential Trust Inc Third Quarter 2019 Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Jackie Graham. Please go ahead, ma’am.

Jackie Graham

Thank you. welcome company’s Residential quarter results and to conference of everyone, the review for day, to Trust’s NexPoint call XXXX. Good the third

President and call Chief Officer. President the today Brian Investment Executive On are and Chief Financial McGraner, Matt Vice Officer; Executive Vice Mitts, and

at reminder, a website is through the being As webcast call company’s this www.nexpointliving.com.

are Before conference the statements that forward-looking meaning of on call Private of I Litigation based within like Act remind to expectations, beliefs. would begin, current contains we everyone this Reform Securities assumptions that management’s the XXXX and

as Forward-looking anticipate, variations be statements words. can identified often of negatives and by and words expressions such expect, similar these intend or

These related related planned cause components and business of subject expressed the the uncertainties value results forward-looking statements and statements to for related but and any assumptions, are assumptions new in assumptions, to, to and and year the They for limited dispositions, regarding and and from materially differ of XXXX results fourth net financial forward-looking full results statement. in NXRT’s the guarantees could quarter asset the are general, include, assumptions, that programs. not XXXX not and industry NXRT’s value-add for guidance metrics future acquisitions and actual risks, expected those acquisition are guidance

with revise to factors NXRT or most filings any should annual not other report on statements. as law, Except and update undue are complete XX-K does statements. more forward-looking SEC discussion any obligation any required risks company’s that the reliance review forward-looking could the not other affect company’s of undertake by publicly the recent place encouraged on Listeners forward-looking for statements to and and a Form the

in as from with of non-GAAP operations, of substitute analysis AFFO; funds not and and used income, operating This a of non-GAAP should a FFO; GAAP. from core computed all or net income financial which measures operations, call for performance. core conference or or These FFO; supplement adjusted are funds to accordance net measures includes or also be operations, loss NOI, from funds

of For was filed complete and AFFO NOI, earnings discussion today. a FFO, more FFO, see release company’s the that earlier core

like ahead, now turn over Please Brian. would to to the go Mitts. Brian I call

Brian Mitts

I’d Mitts, so call. like ground third discuss third for quarter, we’ll by acquisition Brian our activity for the the discuss you, to the present guidance NXRT as as to markets. and through Jackie. of XXXX welcome quarter to year-to-date recent everyone XXXX, Matt QX well Today, Thank year, our most quarterly disposition conference a results and lot update the cover. joined date, to and quarter portfolio McGraner. was I’m I’m active highlights

I’ll the start the with quarter. for highlights First,

QX a increase reporting increase NOI and September X.X% the XX. We’re ended same-store same-store months a for nine of NOI in X.X%

increase for a the of same in we’re XX.X% our nine as ended Consistent XX September reporting the period FFO XXXX. strategy, share per with months high-growth core compared to

During $XXX consisting QX we units. X,XXX acquired four for million, of properties

to units For Nashville X,XXX our the consisting redevelopment for markets the eight of Florida, increasing units acquired $XXX million, pipeline. Phoenix and our adding properties we exposure X,XXX and year, have in approximately

activity. revenues Total same the year-to-date XX% year-over-year. in NOI and up were reflecting for XXXX period XX.X% total XXXX, XX.X% increased over total were XX.X%, our increased QX NOI and Total up acquisition revenues

respectively. new NOI achieving and margins QX in remained leased strong rent plan in and both X.X%, those third completing Saw QX, XXXX units during execute at X% XX.X% Continue growth leases XXX a XXX being our during partial third by XX.X% business the quarter. solid at to for renovations quarter ROI XX.X% with quarter, value-add and and the year-to-date. renewals the of full

we’ve and ROI XX.X%. of X/XX, upgrades, the an date completed partial in average portfolios to X,XXX full Inception achieving of

units across since third across quarter units Additionally, Tech the XXX installs and introduction X,XXX for the Technology package. installs Also, and Home of eight respectively. completed and in Smart XX washer-dryer we we X,XXX XXX properties in year-to-date, the QX completed Smart properties

QX, Net and sold properties. During properties were we sale acquire for million. proceeds $XXX six Pembroke Brentwood the to used consisting units price of of X,XXX

the shares our the increased we the net NAV end XXX,XXX of our revised midpoint For by of the Generally, net down had operating XXXX, gross $XXX used before ATM we outstanding million expenses million to an at balance a an of XX% assets. acquired QX, We our proceeds a premium in ATM $XX.XX QX. of revolver, of price approximately and at from to average shares. utilized million $XX.X raising proceeds which the for outstanding of $XXX pay the

updates range as end, low X.X% upward to share as $XX.XX on a high of $XX.XX $XX.XX compared per end, raised an growth, at Year-to-date, of NOI $XX.XX million price the shares. of approximately midpoint follows, the ATM we’ve in with $XX.X $XX.XX we’re on in new cap or Based on increase. NAV and our QX, million average revising under rates issuing X.X our midpoint

of For dividend board the we of quarter But on $X.XXX share the payable XX.X% cumulative payout $X.XXXX XX. XX% This ratio December – of shareholders the it’ll a per September full over payable a Yesterday, share, per XX% December for on record we in of FFO third year. approximately dividend on our XX. core FFO. a represents estimate a per to XXXX. core of of share dividend be increase prior Year-to-date, increase our paid our over declared XX initial is XX.X% and April dividend dividend

XXXX, a for QX through XXXX. get which results of million the compared for increase. $XX.X high-level me revenues third Let Total quarter were the XX.X% in as $XX.X is million some of to

last million which increase. million quarter income of $XX third for $XX.X operating is the year, versus XX.X% a XXXX was Net

$XX.X on FFO a XX.X%. million share an is $X.X is for per increase quarter, $X.XX $X.XX which million or diluted versus year, last the basis share Core per or of

the XXXX $XX.X over million third Same-store was occupancy increase of versus million $XX.X million $XX.X in $XX.X revenue X% versus which for versus from for rent quarter the last was Same-store or to $XX.X last was X.X% were quarter X.X% third XX.X%. million basis the down a was points year. a quarter is increase. the year X.X% XXXX XXXX Same-store increase. Same-store million third for year Expenses last $XX.X million or year NOI for last increase. XX quarter

for versus Year-to-date $XXX.X revenues which for increase. $XXX.X million total is were XXXX million XXXX, results, a XX.X%

Net operating income $XX.X or XX% was increase. million, $XX.X million versus

an for XX.X%. for $XX.X which is share Same-store basis $X.XX same-store of is million X.X%, which also of same-store the to diluted basis has million FFO $XX.X Core increase increase increased on basis points X.X%. On a versus year, million is revenue an $XX.X a per year-to-date is per $X.XX $XX.X XXXX, million, same-store is XX a on rent down basis XX.X%. or occupancy versus diluted share

X.X% Same-store million versus Today, we’re updating guidance. increase. million NOI expenses million versus for XXXX XXXX or Same-store in $XX.X $XX.X million were a is X.X% $XX.X in XXXX, $XX.X year-to-date which increase. XXXX is

million dispositions. for range of $XXX acquisitions, $XXX range million assumes Our million XXXX for revised a the guidance $XXX to of $XXX million for to

high X% guidance low we’re which last a Core assumptions, on X% is on with $X.XX share is updating $X.XX, the X.X% These per with the end, from same-store basis high midpoint up $X.XX a follows: FFO revenue of on is on the the the XXXX end estimate, which a end, X.X% midpoint which end increase same-store is diluted as quarter; a $X.XX increase end, on on quarter; X.X% in which midpoint, NOI increase the increase low X.X%, same-store the is unchanged on of X.X% end, X% unchanged with X.X% the a is end from up low on is from will on with quarter. end, and we high midpoint, increase last X.X% the last expenses, quarter; last also high from low

we be in To on will fourth our noted very believe quarter be same-store good quarter basis. comparative a guidance, a

XXXX in fourth we we quarter budgeted for of will alone, all tax be favorable large entire comparison to XXXX just conservative that QX year taxes hit and you if across As very not XXXX. response, the a fourth for recall, therefore, the others. reason estimates may had In quarter

details Q&A. turn some of fill go me then now to we’ll in let So to over and it these Matt Matt? to

Matt McGraner

strength continued as up Brian. least by in results Same-stores NOI to mentioned. cover and basis increased were to some markets We points Brian same-store improve market X Nashville, by same the at briefly, every Phoenix, average West Atlanta, our out remained Palm NOI XX flat. Thanks, and including Houston, X% portfolio year-over-year each XX margin entirety To X.X%, revenues growing with of Rents the stores D.C. our Beach, rents across of saw Tampa. except at Houston, which XX.X%. least X.X%,

of to acceleration Notable markets were in Atlanta XX.X%. XX.X% Nashville NOI continued at NOI growth same-store and growth

and Florida Phoenix and D.C. X.X% XX.X%, growth XX X.X%, On out at with the markets at of our out Effective be X.X% DFW X%. top to five registered markets of being leasing our X.X% lease continues X.X%, South markets growth at strong or renewals new with activity Tampa X better with our X.X% growth of XX both X at least at at achieving revenue or better. of Charlotte delivering at front,

$XXX And disposing quite Portfolio were the transaction conversions active mentioned acquiring in during healthy occupancy approximately Turnover we of for the million. activity worth as front, and $XXX disclosed, as Sunbelt and on properties million previously were Brian quarter, of XX%. approximately the

XX% acquisition of by at far and start the beating XX sits company basis Pembroke healthy points is is of by off in a Avant and budget history largest strong to so the a as Our – underwriting Pines today. at occupied

cap rate unit community X,XXX-unit for unit $XXX of million at generate of planning XXX to for of this premiums economic purchased units we and reminder, X%, of XX.X%. and a ROIs average approximately one $XXX an year As $XX,XXX a cost upgrade a

to premiums of a Smart expect unit. We to packages unit also install monthly in $XX generate and every plan a Tech

As average NOI a is same-store result, asset for X.X%. our this underwritten growth three-year

recap for this Nashville acquisition X.XX%. XXX-unit purchased in for built and community We $XX.XX cap one in Brentwood of million Arbors located of XXXX. year rate briefly,

planning a unit ROIs generate a of cost $XXX upgrade at units XX.X%. and of to are XXX premiums $XX,XXX an unit average of approximately We and

XXX and generate We and unit. a dryer to washer expect to $XX monthly install also of sets in premiums units plan

premiums We also a to generate Tech packages in $XX plan to install expect monthly of unit every and unit. Smart

our NOI X%. for average underwritten three-year result, same-store a asset growth is As this

to updated Nashville Brian midpoint. NAV On the at drivers NOI Charlotte. were The mentioned, and NAV and our growth reflection outsized the market rates front, share of as the cap increases a in of $XX.XX NAV updated we’ve

discount to a are complex apartment that While in implied to trading think submarkets. what NAV, cost a it at to still at premium a our to garden it’s new important would highlight our I build we��re trading we

XXXX the the about the XXXX full next boosting Brian to as midpoint on year XX-month excited Looking be year the results, end X.X% excuse guidance our full are X% low mentioned, to and ahead continue run to we and and and earnings. QX, rate QX XXXX me, year same-store – NOI growth full of at the X.X of

at outlined year plan we’re On the front, with execute in then renovations QX and on working push our year beginning QX management of drive to the the asset upgrades. hard full occupancy fewer to

to total We management increased bring This end. year’s expect will plan directly performance. and revenue this collections influence portfolio to QX XX% total occupancy same-store occupancy by boost the

revenue as We XXXX. good continue about to X.X% a hitting growth feel targets for our to result X%

as our our to and growth in other amenity Technology see Home roll also other We packages Smart income we services. out continue resident

and QX As X,XXX completed the over of XX we the units turning of by on the build-up side mentioned, penetration reach revenue – have Brian XXX% further by expect date equation is faster and to across XXXX. properties this to

same-store driver comp XXXX. full year growth the favorable third for for is the tax Finally,

month up expense October budgets registered trued tax estate year. across pool last same-store In the one we real million $X.XX in that XXXX, as

for October estate portfolio all and the a a accrual these strong Our Again, year-over-year quarter factors a $X.XX strengthen is believe comp. result continued XXXX XXXX. we favorable our and creating will in year $XXX,XXX in million, full real tax

the demand to In closing, reiterate for continues strong. very leasing affordable I’ll be just housing our

pipeline cost as units We over And and continue remarks. excited X,XXX the our our upgrade about very all that’s XXXX to next for our the addition to to have well Brian? as of I be over coming prepared acquisitions quarters. capital to

Brian Mitts

Thanks, Matt. for Yes, that’s We’ll the conclusion questions. over remarks. turn it of our prepared

Operator

James. Raymond the floor from for [Operator our you. comes open first And At question Buck time, Horne this Instructions] we’ll with questions. Thank

Buck Horne

Thanks start strategy. your with alluded and you the I want to to I think call. the for taking occupancy,

target, with Just on renewal but any occupancy do to the or signs strategy how to guess wrapping are there, guess but do at are thought before up I that dive your you to just XX% wanted around going pressures I mentioned you comments into seeing does where want to there year-end you in – some with increases? – you resistance how occupancy unfold year-end? strategy the get – the there? want levels what’s And any

Matt McGraner

just year, we’ve rate rehabing pace year. our or is on almost quarter, units this this units in QX. over tried the almost up – double a we ended we units almost year implemented tried which and so XXX too Yes, last This basis for little many XXX upgraded have run

into to renew washer-dryers to So Techs, we the partials. concentration, There of Smart quarter occupancy don’t But the QX, that purposeful. interiors. that goal over do the Dallas, I fourth concentration is, was XX% of to obviously, unit full expect our try A then we residents drive try our on going to lot where most And in upgrade and We’ll can robust Home XX%. frankly. many as and then is for to NOI is focused is in Dallas. stated,

occupancy QX. And be so contributor to growth I key a think that’s to going in

Buck Horne

on the to the Okay, the increases. timing schedule simply not of resistance necessarily and but your that price rent biggest renovation characterization due is

Matt McGraner

QX in mean Well, in general. in there’s resistance I price seasonality

have that increases XX% get rehabs. don’t just found past we the XX%, years on XX%, fully we So in rent

think us, our XX%, at in nothing, plan. hitting it I this in in more resistance, seasonality it’s revenue we budget year, no to focused for our so speak, just QX. And – on But XX% least so

Buck Horne

appropriate per one-time – in new kind the maintenance you repairs and in is okay. like R&M/CapEx. just there any capitalized do the a spending rate unit? a level income statement, maintenance and repairs then reestablishing the in Okay, of items looks maybe of same-store think catch-up for Is or noticing the the was sort What XX%. on and XX% had about run maintenance, expenses jump a that on you And it the about side, up both the spending side, –

Matt McGraner

Great, There are items one-time run great It’s got question. a new there. rate. in

Terrell city policy, of needed lot quarter. that then Nashville there’s And XX% tree kind a trash in and with expense dumpster other issues of items enhancement the in contracts number, Specifically, large code couple in in there mandated. a income, expensed of Atlanta. at one-time expense amenity a fire there is resident inspection, a to Florida three In of almost R&M was inspection Atlanta the our or Mill big related and revenue $XX,XXX. in income within contributors it’s at about fire also and trimming were There that were be and those spend cost items There’s item. service was QX to number properties

So there was that to an expense. offset

Buck Horne

guys. you, Appreciate it. Thank helpful. very That’s Awesome.

Operator

Tayo Mizuho. Okusanya And question our from next comes with

Tayo Okusanya

are morning, Good Yes. How guys. you?

Brian Mitts

Good. How are you?

Tayo Okusanya

quarter. looking you again. the the and with forward questions. on of to Good. good in Congrats working I am Couple back seat

suggests each kind So across growth same-store to, see in fourth the are this numbers bucket and ramp better, I you, I the give growth? think gain, three of, in I And more XX%, big to from of taxes when units, run you quarter, of how like for could have a XX%. you NOI to again, same-store just has the which of, year, coming much fourth forecast regards NOI speak. occupancy NOI will kind in NOI growth regards of, key just us kind so it mentioned was comps wondering upgraded in factors, your quarter the is three to sense better buckets, same-store be those to kind

Matt McGraner

Yes.

think taxes. not basis I the end, two understated. are alone probably the to Taxes be on the point-ish and occupancy is will XXX then occupancy and be low

lot. there is I management plan think going a to our contribute revenue

X% XXXX for over XXXX, – think I anywhere quarter think XX%. we fourth of terms to just do can hit in from we

Tayo Okusanya

Got you.

of what giving portfolio. I in the details quarter, activity you’re have some metrics sup, Okay, is from expecting the that’s which you a second appreciate this the provide helpful. fair the us great around and I to just Then see, is question amount deal

little bit talk a per unit in of done your particularly these also $XX,XXX kind about relative high. Plus First of premium could factors what just, kind on cap Could then unit, a per just the rents bit of, rates of deals cap the you the of one. little you’ve two as talk particularly And costs kind number upgrade seem well? implied seem those rate, number very about past. all, the $XX,XXX you two,

Matt McGraner

be healthy. Yes. Absolutely, The to continues environment acquisition yes.

– in in those knows, January. ones, the As done business. start year-to-date, multifamily Phoenix the those it’s with that acquisitions everyone I’ll because the The done so we’ve were

I at feel XX,XXX, and XX,XXX going from unit make around X to I today. those sell like can – those trending right anywhere We bought think on we turn were Those X.X and in X.X, X.XX. now just more performance.

plan course years. right we’ve around a X% and upgrade to The done that other three acquisitions probably given But we of history can rates, our the X.X% the underwritten of that NOI our year, think we the over growth, X%, cap get X%. throughout

And Not the upgrades, all into X% through XX% but wave one well yield the how a by we’re it. about accretion the are, these go accretive – in at we acquisitions year where rate of so of time cap that’s we’re interior we’re and thinking necessarily today. higher the first than trading

answer part. that’s the So the to first

The part, bit more deals in a little a more recently I we’ve are quality. everything’s will second of the done say expensive. gotten premium

why you’re is do. we’ll on unit side, that’s demo and supported CapEx that’s that larger So the which the per seeing what interior going we forward, frankly probably think a

these Although value of that continue have each to adds. deals

into going We’re A-plus. staying or not like A-minus and

quality We’re all end higher upgrades. higher for suburbs example, Nashville still Florida But the support South focusing of spend workforce. the market, little to on higher

that’s So in see you why increase the the spend.

Tayo Okusanya

of some rents $XX from combination And that plus rents the of premium you. $XX, expecting. get just kind how washer-dryer. $XXX plus that at of I numbers from Got $XX kind these premium Is is $XXX month, Tech the like $XX, a mean to upgrade from Smart are the are then number? just a that of the I

Matt McGraner

to the of $XXX a partials. – are upgrade new achievable try in-place think No. more are are superior result are the that market. We – in comp a the comps costs rents at of is a I typically $XXX larger And where The interior I to above spend, is garden market. the we’re deal comp identify in those the but acquiring. always deal $XXX that’s full that mean the the

little year. and done if that’s exist about bit deal reach more But we So can all in spend attributes we a this $XXX, – we’ve every these forget $XXX, it.

Tayo Okusanya

Got you.

to think So just it with washer-dryer, Smart value market bake do rents, and additional Tech, comps, $XXX? this of that nicer to I it’s run has kind make apartments, add boost – I relative if from nothing that can look

Matt McGraner

Yes.

Tayo Okusanya

you. Thank

Matt McGraner

Toyo. Thanks,

Operator

from Baird. And our next with Babin comes Drew question

Drew Babin

morning. Hey, good

Matt McGraner

Good morning.

Drew Babin

the It declined Florida year-over-year markets, Orlando like scarcity line. value Phoenix, influencing was those that’s Or top the bit supply in on influence occupancy Question quarter. a that. a and it’s strategic creation of looks going drive of that just the is that South something Are to quite third in front – in sort CapEx on those rate?

can little give you hoping more color Just a that. on

Matt McGraner

– portfolio third did was of I mean, your But new try well. own we in on last that of question, part of this quarter over achieved. markets pretty the each in Yes, – think the end those you It those think three highest correspondingly, we on markets. – basis was rents it I we units turn a had same-store did some those were year more I a – year. And of Drew, leases fair occupancy high answered the higher

focus in it’s as and stating, maintaining as QX, of in QX to then in So been much rehabs on building just done rent more occupancy. trying we’ve – and get

Drew Babin

be of more a of is mentioned online, it’d would the So to main driver that of maybe generation, that occupancy and where get are you three of of the from kind that ones rate XQ say more I mentioned fair? those growth Dallas could be markets kind kind you XQ that units to fair

Matt McGraner

I it’s Yes, statement. fair think

in some standpoint, from little has a supply Dallas, than growth rent greater just bit these Although, of the less market. other market a

just try in management much on we’ll in to and of So posture there revenue side. when can as there a more a renew as we be defensive reality,

in drive Orlando’s. other markets, especially I and both these new occupancy leases be to Phoenix’ like think we’ll the still able and

Drew Babin

one that. And for for me. Thanks Okay.

guess sort – next how portfolio Just of, in things you can from kind value-add of this of go same-store is year’s there portfolio opportunity year? and into remaining next that from many the year’s, new transition like kind that properties what that, same-store anyway quantify and becomes I CapEx, embedded as the to you occupancy same-store

Brian Mitts

basis, think that on everything bought full be included. year I not we’ve will a

we end So the year, up. in finish that’ll quarter we up bought while before whatever take a to that will catch the each quarter as prior in But there.

quarter for what example, be quarter this will fourth we So XXXX. bought a of part

Drew Babin

are Okay. But far how portfolio units the many and as year. as next properties entering

that becoming but kind understand year’s I new? guess, wouldn’t same-store So what that’s of, I include is acquisitions, this

Brian Mitts

Yes.

we think I the of XXXX. end bought it’s three that

Drew Babin

in triangulate We which property opportunity those exactly can follow maybe the same-store is – what up that remaining the of results just was offline to kind trying we’ll I about properties. embedded next in year. see

Brian Mitts

to going Crestmont your It’s & I be Brandywine point II. to and Yes. Reserve see

Drew Babin

from Thank Okay. all you. That’s me.

Operator

we with our And next have Thalmann. Massocca Ladenburg question John from

John Massocca

Good morning.

Brian Mitts

John. Hey,

John Massocca

XQ, guidance expecting on more – occurred guidance increase what kind was increase front you’re Just the kind expecting least number. or in what a side, in were obviously, of it the in significant you was in the bit of at additional closed putting that there acquisition of was the little on most but pretty acquisition

that think the the I you just and can done is between So, deals that, today you that generally is of in now the driving kind there or of potentially end what specific any pipeline year? are mean anything get

Brian Mitts

about guidance talking You’re or acquisition guidance? revenue

John Massocca

Sorry, clear. acquisition that should’ve guidance, make

Brian Mitts

done in cost today, nothing year. evaluating and Florida, say we’re today. capital this But do looking at Yes. South feel about of acquisitions including concrete Phoenix, markets, looking markets. market, nothing Charlotte, the like the Las our deals that but growth a good Vegas execution I’d still potential but still concrete we’ve other as of we key across

John Massocca

didn’t that your ultimately, capital kind be cost just of like forward? growth because guidance you is then the external change, future Okay. and are markets going a capital And would the today of that fund reflection that Brian that the kind to of of attractive fact disposition really then guys more

Brian Mitts

we���re for that we’ve the willing recycle years. caveat as with five capital but always past done yes, say I’d to

year, XX/XX we, We a new acquisitions acquisitions. assets. the but new next of trade of deals out fund with portfolio, in that they’re early of that couple then can largely into those will we obviously cost think, see our at we’d potentially our growth But exchanged I small. be sell NOI have But capital existing rather yes,

John Massocca

you much. it that’s very Thank me. from Okay,

Brian Mitts

you. Thank

Operator

question And with Oxford from Barry comes D.A. Davidson. our next

Barry Oxford

guys. Thanks Building plans? the would you as use sourcing on guys could And be source? there for XXXX equity, a ATM enough your the

Brian Mitts

The answer do we’ve line depends enough? Is yes. We used is it. in on I we the think see could what the it on it that use We the acquisition have past. front. revolver

So that a place price the line. course a if we’re we just I be we great think do needed. ATM could of perspective, not imagine may It down over issue in when from to it. can the XXXX, stock pull I utilize utilize timing whatever can we of But would we the

Barry Oxford

of Right. of that source And course, equity. then, you’ll have will also as dispositions a act

Brian Mitts

Correct.

Barry Oxford

fourth What rehab, to quick. at kind guys XXXX? said units as we pulling look back quarter. far in you are, XXXX the So When of, far as as rehab real can switching we in to units here compared you gears as expect

Brian Mitts

which lot partials adding the it’s to then another interior Techs, corresponding are Home a a $XX or and about quarter going mentioned $X,XXX full And upgrades Yes, then to I – XXX install. as I so think look to a premium. Smart a quarter, in with XXX premium, XXX $XX, $XX with similar,

entirety year. quarter the by the across the end the program portfolio that next implement us of of see third You’ll

Barry Oxford

Appreciate Thanks Okay, it. guys. much so great.

Operator

comes Craig question FBR. Kucera next our And B. from Instructions] [Operator with Riley

Craig Kucera

guys. Hey, good morning,

quarter, positive potentially taxes? of what you a last you your tax in quarter that to have refund expecting appeal And a from you’re property think resolution receiving occur component of I fourth property to Do there? any Atera. is mentioned update the an

Brian Mitts

Yes. resolved. It’s it has has not resolved. not been The Atera – been

We’re still "working" to Dallas with the resolve City of it.

not scheduled November. to question, our And the We quarter. it entirely next is have the fourth factored in second meeting in

Craig Kucera

going that’s it. that’s to Got to just $XXX,XXX? $XXX,XXX maybe And say was – expected be to I

Brian Mitts

That’s right.

Craig Kucera

Okay.

questions but Just the wanted to specifically, had I More I ask lot to another a back want it’s know to to just occupancy. related it, question. we’ve about Florida. circle

has a the is row. continue and a quarters renovated not any those for across when in units vacancy about of Does broad couple think be sequentially, markets. we that that have? a think here – of renovated of skew flat Or were to our sort rents units pool the it there pressure I same-store that under that I more being And in basically have think towards couple is there, there been are vacant? mix that

Brian Mitts

report Yes, many we wanted here it’s now that’s a particular whole deal. a broad one today. a – there – in renovated been had host it’s trending for supply to sit I that’s really contributor. XX% the the But in to units as comes mix. as think is I price we deal driver, had And has news larger think, then supply, the which at only as there been reasons. of that ParcXXX of property, which couple It’s – least, good a newer the it’s point And higher we it

So quarter. we back fourth here in snap do expect that to

Craig Kucera

slowed overall XXX maybe XXXX value-add more like but to down commentary, of throughout I moved down from you’re And it. it a units think quarter? the Got just certainly to pace basically based spending, quarter, looking your just to third slow doesn’t on XXX normalized sound

Brian Mitts

me, Yes, lowdown since – getting no third inception. all. the fourth the at Again, on in been we’ve been have that think especially quarter actually, highest ever existing the excuse rehabs, ROIs that we the the

what story the So spend getting that’s has returns, they we’re it, continue money continue we’ll and the spend be the it been. because and to to strong,

Craig Kucera

Thanks. Okay.

Brian Mitts

Thanks, Craig

Operator

next question with Stevenson from And Janney. our comes Rob

Rob Stevenson

Good morning guys.

held side, the that, the Reserve are that for that’s and I at Matt, think the little Creek you Southpoint being So financials? on talked about the deals Stoney Woodbridge assets sale couple on disposition

Brian Mitts

right. That’s

Rob Stevenson

off at coming want And of mean significant how to looking you properties could significant – is that what of out values how type I NOI give – be? dollar those so figure then sort number to if we don’t

Brian Mitts

mean have given I I Yes, think I you. might it to

I million, million. $XX.X-ish $XX type Woodbridge price million, gross $XX Southpoint’s is and think million sale $XX the

Rob Stevenson

Okay.

$XX million. So little over

that Anything your guys of you And about you Okay. talk on in terms there. then contract acquisitions guys? today for could

Brian Mitts

Under contract contract nothing have moment. under – the at we

Rob Stevenson

range talked And the how know a I the guess that the then I additional sort contribution so the and is bit is of and acquisitions? of you question, third $X.XX think about midpoint little the adding did – the the I get of almost the there. it but almost sort $X.XX I from occupancy is the contribution all $X.XX is you acquisitions FFO of, left third – Okay. if the bridge if and all range from think To the the, the sequential see $X.XX to bottom same-store, guidance you’re quarter on quarter that into easily core and basically end it – the not on of mix, in remaining before change, the about $X.XX,

Brian Mitts

Absolutely, if... yes. I mean

Rob Stevenson

Is in that else subsides closing sort of in that anything quarter-to-quarter terms gap? of there there

Brian Mitts

components. were the acquisitions, Yes, like, and those was $XXX million Avant but main of acquisition. And, itself obviously, in say we

well. So that’s driver as a big

Rob Stevenson

just versus back. Okay. per getting And what for are unit you’re Smart Tech last and one then – Matt, spending me. you what on

all what what’s And you’re likely composition has offering it was package month you a $XX we changed or into as unit but like to like or the head outlay change the per something XXXX. think I there said that, of that? in at that is on

rid getting new other finding that adding et things, helpful, You’re things aren’t of cetera? some tenants

Matt McGraner

about really that be people next people more The the residents still The out thermostats, the this. for composition the of and see now do, on composition than, of terms past. more the is to and we do provides $X,XXX energy price the say is community changed That’s other we package. And shower $XX time, But end that where located. of unit everything premium sense the love I’d like Nest will Bluetooth every year. around of security $XX in why really the It pay to we’ve We washer changing in from time at QX depending it the dryers in unit between nothing’s single own it. joked about that every really The of you’ll with to speakers efficient. – much. isn’t

Rob Stevenson

And guess… Okay. I then

Brian Mitts

XX% of to a It’s like ROI unit. That’s spend [indiscernible] kind XX% annually. per

Rob Stevenson

terms labor? six program, a both pressure? most material you that? should days – extent, inflation these to or in upward abated? I And lesser but probably your materials Is that this versus of labor mean continued thinking How we I Okay. about Is be but are and seeing And ago. months pressure any also guess on three cost that rehab

Brian Mitts

Yes.

Our to labor whole about the is portfolio. X% spend really up XX% over entire

used all, it but to to. So to and at been ROIs then the getting is news still XX%. the on is good we’ve material that X% able pass not much frankly, And is so is we the corresponding that – labor

Rob Stevenson

it. I Thanks appreciate Okay. guys,

Brian Mitts

Rob.

Operator

[Operator Instructions] currently this in queue. questions showing I’m at the no And time,

Brian Mitts

the we’ll Great. call. Well, everyone’s we’ll talking up Thanks for Thank you. wrap time later. be and

Operator

you, and teleconference. That today’s Thank concludes ladies gentlemen.

You disconnect. now may