John Pawlowski • Green Street

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Chief Executive Officer Dallas Tanner answered both. He stated there are no current plans for international expansion, as the opportunity in the U.S. remains significant. Regarding non-traditional growth, he mentioned exploring structures to support regional builders, investing in more infill townhome projects that share SFR characteristics, and paying attention to a potential long-term convergence of multifamily and SFR operating structures, though that is not an active pursuit.

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EVP & CFO Jonathan Olsen acknowledged that the long-term goal is a more traditionally fixed-rate balance sheet, calling the swap book a legacy of the prior capital structure. He explained the cost is a de minimis credit charge from the counterparty. The overall strategy is to make interest expense more knowable and less volatile, but he agreed that over time, the company will become less reliant on hedging.

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CFO Jonathan Olsen stated he would not characterize the multi-year lease book as substantially above market. He pointed to a current loss-to-lease of around 1.5% to 2.0% across the portfolio. He suggested that the biggest opportunity for capturing below-market rents lies with long-tenured residents who have renewed multiple times, as the average length of stay now approaches 40 months.

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CFO Jonathan Olsen explained the increase was due to a structural change in their compensation program. The company has shifted from periodic, multi-year outperformance plans to more frequent annual performance-based grants, which alters the timing and accounting of the expense, making year-over-year comparisons less direct.

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President and COO Charles Young defended the performance, stating that renewal asks have been increasing since August and that November renewals are showing 'nice acceleration' to north of 4%. He explained that the focus is on balancing revenue growth with maintaining high occupancy by 'closing the back door.' Young reiterated that they feel good about where renewals are, especially given the high retention rate.

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CFO Steven Freishtat confirmed the distribution estimates are net of all expected expenses and liabilities. COO Tiffany Butcher clarified that the 12-month timeline is for the entire remaining portfolio and is a realistic timeframe that accounts for their experience with regulatory processes like TOPA. CEO Paul T. McDermott provided an update on Watergate, noting the 82% leased figure is their year-end 2025 goal and they are in discussions with the largest tenant.

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COO Tiffany Butcher responded that they are seeing normal seasonal leasing trends in the D.C. metro with no atypical impacts on traffic or other key metrics, attributing this stability to their well-positioned Class B portfolio. CFO Steven Freishtat explained that the 6% sequential revenue growth in Atlanta was driven roughly 50% by an improvement in bad debt and 50% by business interruption insurance proceeds from a prior event.

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President & CEO Peter Scott stated that historical underinvestment and deteriorated health system relationships were key issues, which are now being fixed. EVP & COO Rob Hull added that the RTO program is seeing success, leasing over 100,000 sq. ft. year-to-date by capturing tenants needing to move quickly. EVP & CIO Ryan Crowley explained the 7% disposition cap rate reflects a mix of assets, including some with value-add components and others in undesirable markets with lower occupancy, lower margins, and older vintage.

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CFO Austen Helfrich confirmed that addressing the 2026 maturities is a focus for the second half of 2025. Interim CEO Constance Moore clarified the current outlook for dividend coverage is late 2025 or early 2026, with timing dependent on leasing velocity. Helfrich added that FAD per share grew over 10% in the second half of 2024 and the new guidance reflects the current team's view.

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SEVP & CFO Christopher Lau clarified that recent turnover trends are a matter of timing due to the lease expiration management initiative shifting activity to the first half of the year, with full-year turnover expected to be similar to the prior year. He explained that the fee income growth is also timing-related, as fees correlate with leasing volume, and expects it to moderate in the second half.

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CEO Bryan Smith explained that as development communities stabilize, yields migrate from the initial mid-5% range into the 6% range by year three, after accounting for stabilized expenses and property tax resets. CFO Chris Lau confirmed that by year three, property taxes have settled and turn activity is occurring. Regarding governance, Smith stated that the board's size and composition are active discussion points for the board and its committees, but deferred to them for a final decision.

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CFO Chris Lau explained that using the balance sheet provided speed and certainty for the seller, a key advantage that was made possible by the company's strong financial position. He noted this approach keeps leverage at target levels and preserves capacity for future growth, while the disposition program remains robust. COO Bryan Smith addressed the BTR question, stating that new development homes are still less than 10% of the same-home pool, so their positive performance characteristics do not yet have a material impact on the overall portfolio's growth rates.

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President & CIO Joseph Fisher stated potential starts in Virginia and Texas would yield in the mid-5s on current rents, which is accretive on an incremental capital basis due to legacy land costs. He acknowledged it's not the highest priority. Regarding add-backs, Fisher explained they are for episodic items: legal costs are primarily for the RealPage litigation, software costs are for a one-time CRM transition and write-off, and casualty charges relate to large, infrequent weather events and prior-year reclassifications.

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SVP of Operations Mike Lacy responded that the operating model is 'better than stabilized' and expects future cost growth in these areas to be muted. He noted that declining turnover from the customer experience project will constrain R&M costs. He also stated there is no significant tail of repair costs from past evictions, as the number of 'squatters' has returned to historical norms and damage is less severe.

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President & CEO Angela Kleiman argued that BLS data is less reliable due to lower participation rates and pointed to the contradiction of the Bay Area having the best rent growth despite negative reported job growth. She cited rising tech job openings as a better indicator. EVP & CIO Rylan Burns confirmed the new preferred equity deal has a total loan-to-cost in the 70%-80% range, consistent with their underwriting standards of capping leverage at 85%.

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Executive Angela Kleiman noted that Seattle demand spiked 30-45 days after Amazon's initial RTO announcement, and future benefits depend on when new mandates are enforced. Executive Barb Pak defended excluding advocacy costs by defining them as non-recurring, with the last such expense occurring four years prior. She stated this is standard industry practice and the company is transparent about the amounts.

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CEO Mahbod Nia stated that while the land market is difficult, Veris would like to make more progress on sales without resorting to a fire sale. COO Anna Malhari indicated that Liberty Towers occupancy might see some volatility but should stabilize in the low 80s going forward. She projected the full renovation would take approximately three years, likely completing around year-end 2027 or early 2028.

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Chief Executive Officer Mahbod Nia acknowledged that Liberty Towers' occupancy was slightly lower than planned due to renovation delays but expects improvement from current levels. Chief Operating Officer Anna Malhari clarified that only two immaterial, non-managed assets are excluded from leasing statistics. Regarding Sable, Nia explained the legacy JV agreement, inherited from when Veris was an office company, outsourced management. The $1 million synergy represents the direct savings from eliminating the third-party management fee, with further savings from operational consolidation.

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CEO Scott Schaeffer and President and CFO Jim Sebra emphasized that the outlook is driven by a dramatic drop in new supply, with their submarkets expected to see 8.5% positive net absorption in 2025 versus negative absorption in 2024. EVP of Operations Janice Richards added that Atlanta and Raleigh have seen improving new lease trends each month, while Charlotte and Colorado will face more prolonged supply pressure.

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Paul Seavey, an executive, clarified the occupancy percentage was skewed by the addition of new expansion sites to the denominator. Patrick Waite, an executive, defined 'modest' as 25 to 50 sites. Regarding RV growth, Paul Seavey noted a tough leap-year comparison impacted Q1 results, while Marguerite Nader, an executive, added that the full-year guidance reflects a delay at a single marina property.

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Paul Seavey, EVP and CFO, indicated that Q4 seasonal reservations are tracking slightly ahead of forecast, while leading indicators for Q1 are currently flat to slightly down. He also noted that revenue growth next year might see a slight drag as occupancy from displaced residents normalizes. Patrick Waite, EVP and COO, added that while there might be slightly higher attrition from the larger group of post-COVID campers, the company is rebuilding its customer base at a pace consistent with pre-COVID levels.

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CEO Rick Matros and EVP Talya Nevo-Hacohen explained that a higher volume of opportunities from sources like private equity exits and an improved cost of capital are driving acquisition confidence. CFO Michael Costa clarified that the SHOP growth guidance reflects conservatism as occupancy nears stabilization, while acknowledging that operating leverage is increasing as evidenced by flat expense growth.

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CFO Robert Probst explained the higher FAD CapEx is the new normal, driven by a larger portfolio and inflation, and does not include separate redevelopment CapEx like the Brookdale project. Executive J. Hutchens clarified that it is the RevPOR *growth rate* that is 30-40% higher in top-tier occupancy properties, indicating future pricing power.

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CIO Matthew Birenbaum explained that for 5-to-10-year-old assets, they might see a 10-20% discount to replacement cost, which they view as appropriate. He clarified his earlier comment on portfolio trading, stating that while their balance sheet supports a large trade and the timing is attractive, they are not currently seeing a specific portfolio that meets their criteria. The hope is to increase trading activity, but nothing is imminent.

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CEO Mark Parrell confirmed that urban supply is expected to decline more significantly, which reinforces their strategy of maintaining a strong urban presence. He stated their positive view on urban concentration has not materially changed. Regarding D.C., COO Michael Manelis reported very strong current occupancy at 97.1% with no negative impact seen yet from federal workforce uncertainty. Mark Parrell added that D.C.'s diversified employer base and potential return-to-office mandates could mitigate risks.

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COO Michael Manelis highlighted a 40% year-over-year drop in concessions and a clear shift in migration from suburbs to the urban core as key metrics for Seattle's recovery. For Los Angeles, he stated they are over two-thirds through their eviction backlog and the process timeline has improved, but pressure from excess inventory will likely persist for a couple more quarters.

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SVP of Operations Megan Krull responded that she has not seen anything significantly negative, with most states providing sizable reimbursement increases. She added that while states are always considering new rules, most are holding off to see the outcome of the federal staffing mandate.

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John Burkart (COO) explained that the company is implementing a new CapEx strategy focused on long-term life cycle costs, which may elevate spending in the short term by bundling projects. This strategy is designed to lower the long-term run rate and improve the customer experience, though it creates some near-term noise in the numbers.

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