Jason Sabshon • Keefe, Bruyette & Woods

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Chief Executive Officer Dallas Tanner and Chief Investment Officer Scott Eisen confirmed they receive frequent inbounds. They emphasized that they are selective, seeking sophisticated, like-minded institutional partners with scale and market overlap. Eisen added that these partnerships are viewed as opportunities for future growth, as they provide a first look to acquire assets if a partner decides to sell parts of their portfolio.

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President Charles Young stated they have not seen such a trend. He reported that the percentage of residents moving out to purchase a home is at a historical low, in the mid-teens. Despite awareness of homebuilder rate buy-downs, it has not translated into a noticeable increase in move-outs for homeownership from their portfolio.

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Chief Investment Officer Scott Eisen broke down the market into channels. For forward purchases from builders, he stated they are still seeing deals around a 6% cap rate. For stabilized, fully leased communities that have come to market, he sees pricing in the 5.5% cap rate range. He noted there has not been meaningful activity in the MLS market to form an opinion on those cap rates.

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CEO & Trustee Bryan Smith stated that while they have considered seniors housing, the company's near-term focus remains on its core strategy due to the significant internal opportunities. SEVP & CFO Christopher Lau confirmed that the current land pipeline is at an appropriate level and that the company remains committed to keeping total development exposure at a single-digit percentage of the balance sheet.

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CFO Chris Lau explained that AMH's insurance program is placed at a national portfolio level, not market by market. He noted the 2024 renewal was successful, with a premium increase in the high single-digits. Despite an active hurricane season, he expressed confidence heading into the 2025 renewal, citing a well-capitalized insurance market and AMH's strong reputation for its disaster preparedness programs.

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CEO Marc Ganzi confirmed a significant uptick in interest for their private credit strategies, with the LP pipeline for the credit fund growing over 50% in 90 days. He highlighted that credit attracts different types of investors, such as insurance companies, which complements the flagship fund's investor base. Ganzi also emphasized the growth of Separately Managed Accounts (SMAs) in credit, which brings in new investors who may later look at the main fund, creating a 'virtuous cycle' and diversifying the company's fundraising efforts.

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CEO Matt Salem explained the Raleigh loan was downgraded to a 5-rating due to an upcoming maturity combined with weaker-than-expected rent growth in its specific submarket. For Life Science, he stated that most exposure is in high-quality, purpose-built assets in prime markets targeting large tenants. While lease-up risk exists, he said it is not KREF's current expectation that the 3-rated loans will migrate to a 4-rating, citing prior modifications and strong asset quality.

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CEO Matt Salem stated that progress has been made on life science assets through foreclosure and modification, and the remaining exposure is largely in high-quality, well-located construction loans. He noted 'green shoots' as tenants re-enter the market seeking the best assets, which aligns with KREF's portfolio. For the multifamily watch list, Salem explained the issues are mixed: some are in markets with new supply impacting rents, while the West Hollywood asset is more of a valuation issue from a peak-market financing, which is why a condo sellout strategy is being pursued.

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