Executive Summary

Q1 2025 delivered steady operations: same-store NOI up 3.2% YoY, occupancy 94.0%, and blended lease tradeouts of 2.4%, while Core FFO/share rose to $0.16 (helped by accelerated Urby tax credit recognition) .
Against S&P Global consensus, Veris modestly missed EPS and revenue but slightly exceeded EBITDA: EPS (-$0.12 vs -$0.10 est), revenue ($67.76m vs $69.24m est), EBITDA ($36.68m vs $35.86m est) — magnitude small; drivers include Liberty Towers renovations and utility cost uptick, partially offset by accretive Sable consolidation synergies .
2025 guidance maintained (Core FFO $0.61–$0.63; SS NOI +1.7–2.7%), reflecting macro uncertainty (tariffs, policy) despite accretive transactions (Sable consolidation, land JV unwinds) and stronger leasing into Q2/Q3 .
Strategic catalysts: $300–$500m non-strategic asset sales over 12–24 months, up to $100m buyback, deleveraging to <9x by end-2026; subsequent consolidation of Sable (largest JV) expected >$1m run-rate synergies and ~$0.03/share accretion vs 2024 Core FFO .
Liquidity of ~$146m and nearly all debt hedged/fixed (WA rate 4.96%, maturity 2.8 years) supports execution; net debt/EBITDA improved to 11.4x TTM .

What Went Well and What Went Wrong

What Went Well

Same-store performance: NOI +3.2% YoY; property revenue +2.4% YoY; NOI margin up 50 bps to 67.2% .
Portfolio simplification and accretion: acquired partner’s 15% stake in Jersey City Urby (rebranded Sable), internalized management; expecting >$1m annualized synergies and ~$0.03/share accretion vs 2024 Core FFO. CEO: “Leveraging the Veris Residential platform, we expect the property to realize over $1 million of annualized synergies” .
Asset sales progress: $45.4m year-to-date non-strategic sales closed; $34m under binding contract, unwinding two JVs to unlock value (part of $300–$500m plan) .

What Went Wrong

Liberty Towers renovations pressured occupancy (80.5% in Q1), weighing revenue; management noted slower initial pace due to infrastructure repairs, with stabilization expected and $0.06 Core FFO accretion once complete .
Utilities drove controllable expense growth (+3.5% YoY) amid colder Northeast winter; management highlighted controllables up vs prior year with non-controllables down modestly .
Slight consensus misses on EPS and revenue; macro uncertainty (tariffs, trade policy) cited as reason to hold guidance despite accretive transactions. CEO: “We’ve decided to leave guidance unchanged… given the high degree of market volatility and economic uncertainty… tariffs… changes to trade policy” .

Financial Results

Key Financials vs Prior Periods

Metric	Q3 2024	Q4 2024	Q1 2025
Total Revenues ($USD Millions)	$68.175	$68.083	$67.756
Diluted EPS ($USD)	-$0.10	-$0.13	-$0.12
Core FFO per Diluted Share ($USD)	$0.17	$0.11	$0.16
Adjusted EBITDA ($USD Millions)	$37.118	$32.510	$36.675
Same-Store NOI Margin (%)	68.3%	66.5%	67.2%

Actuals vs S&P Global Consensus (Q1 2025)

Metric	Actual Q1 2025	Consensus Q1 2025	Surprise
EPS ($USD)	-$0.12	-$0.1014	-$0.0186 (miss)*
Revenue ($USD Millions)	$67.756	$69.238	-$1.482 (miss)*
EBITDA ($USD Millions)	$36.675	$35.859	+$0.816 (beat)*

Values with asterisk retrieved from S&P Global.

KPIs

KPI	Q3 2024	Q4 2024	Q1 2025
Same-Store Occupancy (%)	95.1%	93.9%	94.0%
Blended Lease Tradeouts (%)	4.6%	0.5%	2.4%
Avg Revenue per Home ($)	$3,980	$4,033	$4,019

Same Store Market Breakdown (NOI at share, occupancy)

Market	NOI at Share ($USD 000s) Q4 2024	NOI at Share ($USD 000s) Q1 2025	Occupancy Q4 2024	Occupancy Q1 2025
NJ Waterfront	$37,733	$37,673	93.8%	93.4%
Massachusetts	$6,787	$6,816	93.9%	95.0%
Other	$6,299	$6,404	94.0%	95.2%
Total	$50,819	$50,893	93.9%	94.0%

Balance Sheet and Liquidity

Metric	Q4 2024	Q1 2025
Liquidity ($USD Millions)	~$158	~$146
Net Debt ($USD 000s)	$1,647,892	$1,643,411
TTM EBITDA ($USD 000s)	$140,694	$144,191
Net Debt/EBITDA (x)	11.7x	11.4x
WA Interest Rate / Maturity	4.95% / 3.1 yrs	4.96% / 2.8 yrs

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Same Store Revenue Growth	FY 2025	2.1%–2.7%	2.1%–2.7%	Maintained
Same Store Expense Growth	FY 2025	2.6%–3.0%	2.6%–3.0%	Maintained
Same Store NOI Growth	FY 2025	1.7%–2.7%	1.7%–2.7%	Maintained
Core FFO per Share	FY 2025	$0.61–$0.63	$0.61–$0.63	Maintained
Net Loss per Share	FY 2025	-$0.24 to -$0.22	-$0.24 to -$0.22	Maintained
Depreciation per Share	FY 2025	$0.85	$0.85	Maintained
Dividend per Share	2025 cadence	$0.08 (Q4 paid)	$0.08 (Q2 declared)	Maintained

Earnings Call Themes & Trends

Topic	Q3 2024 (Prev)	Q4 2024 (Prev)	Q1 2025 (Current)	Trend
AI/Technology platform	Quinn AI leasing assistant driving conversions; payroll savings	Introduced Prism strategy; added “Taylor” AI for delinquency	Reimagined resident app; 65% adoption in week one; platform analytics	Expanding scope and impact
Macro/Tariffs & policy	Limited supply, strong NY/NJ demand	Macro uncertainty; higher-for-longer rates; tariffs inflate construction; restrictive immigration impacts labor	Tariffs/trade changes elevate recession risk/inflation; prudently hold guidance	Heightened caution
Regional dynamics (Jersey City)	Waterfront outperformance; blended spreads 6.7%	Out-of-state move-ins >55%; NYC proximity drives appeal	20–25% move-ins from Manhattan; >50% out-of-state; demand resilient	Strong fundamentals
Portfolio optimization/JVs	Liberty Towers value-add; desire to clean up JVs	Plan to sell $300–$500m; up to $100m buybacks; delever to <9x	Sable consolidation (85%→100%); >$1m synergies; area staffing savings ~$0.4m	Accelerating simplification
Expense control	Insurance/tax favorable resets; margin expansion	Controllables flat; overhead stable; margin 66.8%	Controllables +3.5% due to utilities; non-controllables down; NOI +3.2%	Mixed ex weather

Management Commentary

CEO on accretive consolidation: “We further simplified our portfolio, consolidating our interest in the Jersey City Urby, now Sable… we expect the property to realize over $1 million of annualized synergies on a run-rate basis.” .
CFO on Core FFO upside drivers: “Core FFO per share was $0.16… $0.03 higher than expected due to the early recognition of the Urby tax credit…” .
CEO on guidance prudence: “We’ve decided to leave guidance unchanged… given the high degree of market volatility and economic uncertainty… tariffs and changes to trade policy…” .
COO on leasing momentum: “New leases trade positive in February… blend accelerated… exceeding 4% in March and 4.8% through April 21.” .

Q&A Highlights

Leasing cadence and spreads: Blended tradeouts progressed from ~2.5% in Feb to 4% in March and 4.8% through April 21; renewals mid-single digits for Q2 scheduling .
Demand sources: ~20–25% of move-ins from Manhattan; >50% out-of-state move-ins driven by return-to-office and relative value (amenities, larger units, no NYC tax) .
Capital allocation and sale pipeline: Team confident executing $300–$500m asset sales amid choppy markets; disciplined approach to buyer liquidity and pricing .
Sable (Urby) acquisition economics: Negotiated 6.1% cap including synergies; internalized management fees (~$1m) plus ~$0.4m payroll savings via area staffing model .
Liberty Towers renovation: Occupancy trough around 80.5% due to structural work; leasing of renovated units shows >20% gross rental uplift; expected $0.06 Core FFO accretion post-stabilization .

Estimates Context

EPS: Actual -$0.12 vs S&P Global consensus -$0.10 (miss of ~$0.02); impact from Liberty Towers occupancy and utilities, partly offset by tax-credit timing *.
Revenue: Actual $67.76m vs S&P Global consensus $69.24m (miss of ~$$1.48m); same-store revenue growth strong but Liberty Towers renovation drag and lower parking/other income YoY *.
EBITDA: Adjusted EBITDA $36.68m slightly above S&P Global consensus $35.86m (beat of ~$0.82m) *.
Values with asterisk retrieved from S&P Global.

Where estimates may adjust: modest upgrades to EBITDA trajectory (synergies realized), with EPS and revenue consensus likely to incorporate Liberty Towers renovation drag timing and utilities normalization as leasing season strengthens .

Key Takeaways for Investors

Operational momentum intact into peak leasing season; watch for sequential uplift in blended spreads and occupancy ex-Liberty Towers as renovations progress .
Portfolio simplification and Sable consolidation are earnings accretive; internalized fees and area staffing savings drive >$1m+ synergies, supporting Core FFO upside vs initial plan .
Guidance prudence reflects macro/tariffs rather than company-specific weakness; any resolution of policy uncertainty could unlock guidance raises and estimate upgrades .
Capital allocation remains a catalyst: execution on $300–$500m asset sales, up to $100m buybacks, and deleveraging to <9x by end-2026 support valuation re-rating .
Monitoring points: Liberty Towers stabilization pace, Q3 insurance/tax resets (expected to create weaker SS NOI in Q3 vs prior year), and progress on land/JV dispositions .
Balance sheet resilient: nearly all debt fixed/hedged; liquidity ~$146m; WA rate 4.96% and 2.8-year maturity; net debt/EBITDA trending lower .
Near-term trading implication: modest EPS/revenue misses are small; narrative is improving leasing momentum, accretive JV consolidation, and buyback potential — constructive into summer leasing season .

Veris Residential, Inc. (VRE)·Q1 2025 Earnings Summary