Centerspace Reports Third Quarter 2026 Financial & Operating ResultsMINNEAPOLIS, MN, November 2, 2026 - Centerspace (NYSE: CSR) (the "Company") announced today its financial and operating results for the three and nine months ended September 30, 2026. The tables below show Net Income, Funds from Operations ("FFO")1, and Core FFO1, all on a per diluted share basis, for the three and nine months ended September 30, 2026; Same-Store Revenues, Expenses, and Net Operating Income ("NOI")1 over comparable periods; and Same-Store Weighted Average Occupancy, Lease Rate Growth, and Resident Retention for each of the three months ended September 30, 2026, June 30, 2026, and September 30, 2025 and the nine months ended September 30, 2026 and 2025.
Three Months Ended September 30, Nine Months Ended September 30,
Per Common Share | 2026 | 2025 | 2026 | 2025 | ||||
Net income - diluted | $ | 7.28 | $ | 3.19 | $ | 6.46 | $ | 2.12 |
FFO - diluted(1) | $ | 0.83 | $ | 1.19 | $ | 3.10 | $ | 3.60 |
Core FFO - diluted(1) | $ | 1.11 | $ | 1.19 | $ | 3.51 | $ | 3.68 |
Same-Store Results(2) | Year-Over-Year Comparison Q3 2026 vs. Q3 2025 | Sequential Comparison YTD Comparison Q3 2026 vs. Q2 2026 2026 vs. 2025 | ||||||
Revenues | -% | -% -% | ||||||
Expenses | 4.2% | 8.1% 2.7% | ||||||
NOI(1) | (2.7)% | (4.9)% (1.7)% | ||||||
Three months ended | Nine months ended | |||||||
Same-Store Results(2) | September 30, 2026 | June 30, 2026 | September 30, 2025 | September 30, 2026 | September 30, 2025 | |||
Weighted Average Occupancy | 95.0% | 96.0% | 95.7% | 95.5% | 95.8% | |||
Effective New Lease Rate Growth | (1.9)% | (0.8)% | (3.7)% | (1.7)% | (1.2)% | |||
Effective Renewal Lease Rate Growth | 3.4% | 3.4% | 2.8% | 3.3% | 2.8% | |||
Effective Blended Lease Rate Growth (3) | 1.7% | 1.8% | 0.5% | 1.3% | 1.2% | |||
Retention Rate | 61.5% | 61.8% | 61.9% | 60.2% | 62.3% | |||
NOI, FFO, and Core FFO are non-GAAP financial measures. For more information on their usage and presentation, and a reconciliation to the most directly comparable GAAP measures refer to "Non-GAAP Financial Measures and Reconciliations" and "Non-GAAP Financial Measures and Other Terms" in the Supplemental Financial and Operating Data below.
Same-store results are updated for annual composition changes including acquisitions, dispositions, changes in held for sale classification, and repositioning activity. The current same-store results include 44 apartment communities. During the nine months ended September 30, 2026, we disposed of fourteen apartment communities. Refer to "Non-GAAP Financial Measures and Reconciliations" in Supplemental Financial and Operating Data within.
Effective blended lease rate growth is weighted by lease count.
Overview of the Third QuarterDisposed of thirteen apartment communities consisting of 1,634 homes for an aggregate sales price of $288.8 million, bringing total aggregate sales price on dispositions during the year to $318.8 million;
Fully repaid the line of credit balances and reduced borrowing capacity by $150.0 million to $250.0 million, contributing to a $4.6 million decrease in interest expense compared to the same period in the prior year and driving net debt to Adjusted EBITDA of 6.3x;
Revenue decreased by $11.9 million or 16.6% to $59.5 million, compared to $71.4 million for the same period of the prior year, primarily due to the sale of 14 apartment communities during the nine months ended September 30, 2026 and 12 apartment communities in the prior year, offset by increased revenue from non-same-store communities;
Same-store revenues were flat year over year, while property operating expenses increased by 4.2%, partially due to a large one-time utility expense of $200,000, resulting in a 2.7% decrease in same-store NOI compared to the same period of the prior year;
Net income was $7.28 per diluted share, compared to net income of $3.19 per diluted share for the same period of the prior year primarily due to the higher gain on sale of real estate and other investments of $150.3 million compared to
$79.5 million in the same period of the prior year; and
Core FFO per diluted share decreased 6.7% to $1.11, compared to $1.19 for the same period of the prior year, primarily reflecting dispositions in 2026 and 2025, partially offset by higher NOI from non-same-store communities and lower casualty loss and lower interest expense.
At the end of the third quarter, Centerspace had $366.2 million of total liquidity on its balance sheet, consisting of $250.0 million available under its line of credit and cash and cash equivalents of $116.2 million.
Pending IRT Business CombinationOn September 8, 2026, Centerspace entered into a merger agreement with Independence Realty Trust, Inc. ("IRT") and the other parties thereto. Under the agreement, as amended, each outstanding Centerspace common share, other than specified excluded shares, will be converted into the right to receive 3.8 shares of IRT common stock, subject to adjustments provided in the agreement, with cash paid in lieu of fractional shares. Completion remains subject to required shareholder approvals and other closing conditions. Centerspace has scheduled a special meeting of shareholders for November 10, 2026. Additional information is available in the definitive joint proxy statement/prospectus and the Company's SEC filings.
2026 Financial OutlookIn light of the proposed merger with IRT announced on September 8, 2026, Centerspace will no longer provide guidance nor is it affirming past guidance.
Upcoming EventsCenterspace to hold a special meeting of shareholders on November 10, 2026 at 9:30 a.m. Central Time.
Supplemental InformationSupplemental Operating and Financial Data for the quarter ended September 30, 2026 included herein ("Supplemental Information") is available in the Investors section on Centerspace's website at https://www.centerspacehomes.com or by calling Investor Relations at 952-401-6600. Non-GAAP financial measures and other capitalized terms, as used in this earnings release, are defined and reconciled in the Supplemental Financial and Operating Data, which accompanies this earnings release.
About CenterspaceCenterspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of September 30, 2026, Centerspace owned 47 apartment communities consisting of 10,456 homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and Utah. Centerspace was named a Top Workplace in 2026 by USA Today and for the seventh consecutive year in 2026 by the Minnesota Star Tribune. For more information, please visit https://www.centerspacehomes.com.
Forward-Looking StatementsCertain statements in this press release and the Supplemental Operating and Financial Data are based on the Company's current expectations and assumptions, and are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions, or other items related to the future. Forward-looking statements are typically identified by the use of terms such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "will," "assumes," "may," "projects," "outlook," "future," and variations of such words and similar expressions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from the results of operations, financial conditions, or plans expressed or implied by the forward-looking statements. Although the Company believes the expectations reflected in its forward-looking statements are
based upon reasonable assumptions, it can give no assurance that the expectations will be achieved. Any statements contained herein that are not statements of historical fact should be deemed forward-looking statements. As a result, reliance should not be placed on these forward-looking statements as these statements are subject to known and unknown risks, uncertainties, and other factors beyond the Company's control and could differ materially from actual results and performance. Such risks and uncertainties are detailed in the Company's filings with the Securities and Exchange Commission ("SEC"), including the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" sections of its Quarterly Report on Form 10-Q for the quarter ended September 30, 2026 and Annual Report on Form 10-K for the year ended December 31, 2025, and in its other filings with the SEC. In addition, such risks, uncertainties and other factors include, but are not limited to: the ability to complete the proposed business combination with Independence Realty Trust, Inc. ("IRT") on the terms or timeline currently contemplated, or at all; the ability to obtain required shareholder approvals and satisfy or obtain waivers of the other closing conditions; IRT's right to defer Closing under specified circumstances relating to lender consents; changes in the market price of IRT common stock and the resulting market value of the consideration payable to Centerspace shareholders; adjustments to the exchange ratio resulting from certain special distributions; substantial transaction costs and the potential obligation to pay a termination fee if the merger agreement is terminated under specified circumstances; restrictions on the Company's operations, financing and capital allocation activities and its ability to pursue alternative transactions during the pendency of the business combination; disruption of business relationships and uncertainty affecting employee recruitment and retention; diversion of management's attention from ongoing operations and other business opportunities; litigation or other proceedings relating to the business combination; adverse effects on the Company's business, financial condition, results of operations, share price and reputation if the business combination is delayed or not completed; the ability to realize the anticipated benefits of the business combination and manage transition and integration risks; Centerspace's ability to realize the anticipated benefits of its recently completed dispositions; and other risks described in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2026, its Annual Report on Form 10-K for the year ended December 31, 2025 and its other filings with the SEC. The Company assumes no obligation to update or supplement forward-looking statements that become untrue due to subsequent events.
Contact InformationInvestor Relations Justin Ziegler
Phone: 952-401-6600
Email: [email protected]
Marketing & Media Kelly Weber
Phone: 952-401-6600
Email: [email protected]
Supplemental Financial and Operating Data Table of ContentsSeptember 30, 2026
PageCommon Share Data S-1
Key Financial Data
Condensed Consolidated Statements of Operations S-2
Condensed Consolidated Balance Sheets S-3
Non-GAAP Financial Measures and Reconciliations
Net Operating Income S-5
Same-Store Controllable Expenses S-7
Funds From Operations and Core Funds From Operations S-8
Adjusted EBITDA S-9
Debt and Capital Analysis
Debt Analysis S-10
Capital Analysis S-11
Portfolio Analysis
Same-Store Comparisons S-12
Portfolio Summary S-15
Capital Expenditures S-16
Non-GAAP Financial Measures and Other Terms S-17
CENTERSPACE COMMON SHARE DATA (NYSE: CSR)Three Months Ended | |||||
September 30, 2026 | June 30, 2026 | March 31, 2026 | December 31, 2025 | September 30, 2025 | |
High closing price | $ 58.62 | $ 68.89 | $ 67.00 | $ 67.73 | $ 61.09 |
Low closing price | $ 52.39 | $ 54.89 | $ 57.05 | $ 57.41 | $ 53.18 |
Average closing price | $ 55.33 | $ 63.04 | $ 62.88 | $ 62.84 | $ 57.79 |
Closing price at end of quarter | $ 54.40 | $ 56.19 | $ 57.45 | $ 66.72 | $ 58.90 |
Common share distributions - annualized | $ 3.08 | $ 3.08 | $ 3.08 | $ 3.08 | $ 3.08 |
Closing price dividend yield - annualized | 5.7 % | 5.5 % | 5.4 % | 4.6 % | 5.2 % |
Closing common shares outstanding (thousands) | 16,824 | 16,792 | 16,803 | 16,761 | 16,703 |
Closing limited partnership units outstanding (thousands) | 878 | 882 | 901 | 920 | 963 |
Closing Series E preferred units, as converted (thousands) | 1,852 | 1,878 | 1,884 | 1,892 | 1,894 |
Total closing common shares, limited partnership units, and Series E preferred units, as converted, outstanding (thousands) | 19,554 | 19,552 | 19,588 | 19,573 | 19,560 |
Closing market value of outstanding common shares, plus imputed closing market value of outstanding limited partnership units and Series E preferred units, as converted (thousands) | $ 1,063,738 | $ 1,098,627 | $ 1,125,331 | $ 1,305,911 | $ 1,152,084 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
(in thousands)
Three Months Ended | Nine Months Ended | ||||||
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 9/30/2026 | 9/30/2025 | |
REVENUE | $ 59,515 | $ 65,782 | $ 65,069 | $ 66,621 | $ 71,399 | $ 190,366 | $ 207,041 |
EXPENSES | |||||||
Property operating expenses, excluding real estate taxes | 17,506 | 17,625 | 18,242 | 18,496 | 21,210 | 53,373 | 59,131 |
Real estate taxes | 6,157 | 7,022 | 7,332 | 6,140 | 7,165 | 20,511 | 22,506 |
Property management expense | 1,986 | 2,094 | 2,379 | 2,323 | 2,489 | 6,459 | 7,315 |
Casualty loss, net of recoveries | (441) | (206) | (21) | (242) | 127 | (668) | 1,058 |
Depreciation and amortization | 23,127 | 25,075 | 26,498 | 29,424 | 29,056 | 74,700 | 83,807 |
Impairment of real estate investments | - | - | 9,700 | 14,500 | 8,676 | 9,700 | 23,219 |
General and administrative expenses | 4,995 | 5,659 | 6,332 | 6,542 | 4,997 | 16,986 | 14,376 |
Merger related costs | 5,020 | - | - | - | - | 5,020 | - |
TOTAL EXPENSES | $ 58,350 | $ 57,269 | $ 70,462 | $ 77,183 | $ 73,720 | $ 186,081 | $ 211,412 |
Gain (loss) on sale of real estate and other investments | 150,308 | 271 | - | (61) | 79,531 | 150,579 | 79,531 |
Operating income (loss) | 151,473 | 8,784 | (5,393) | (10,623) | 77,210 | 154,864 | 75,160 |
Interest expense | (8,412) | (10,623) | (10,470) | (11,536) | (12,989) | (29,505) (33,348) | |
Loss on extinguishment of debt | (526) | - | - | (95) | (3) | (526) (3) | |
Interest and other income | 1,112 | 709 | 890 | 776 | 1,190 | 2,711 | 2,633 |
NET INCOME (LOSS) | $ 143,647 | $ (1,130) | $ (14,973) | $ (21,478) | $ 65,408 | $ 127,544 | $ 44,442 |
Distributions to Series D preferred unitholders | (57) | (58) | (57) | (57) | (109) | (172) (429) | |
Net (income) loss attributable to noncontrolling interest - Operating Partnership and Series E preferred units | (20,262) | 168 | 2,141 | 3,102 | (9,197) | (17,953) (6,071) | |
Net income attributable to noncontrolling interests - consolidated real estate entities | - | - | - | - | (2,319) | - (2,408) | |
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS | $ 123,328 | $ (1,020) | $ (12,889) | $ (18,433) | $ 53,783 | $ 109,419 | $ 35,534 |
Per Share Data - Basic | |||||||
Net income (loss) per common share - basic | $ 7.32 | $ (0.07) | $ (0.77) | $ (1.10) | $ 3.22 | $ 6.49 | $ 2.12 |
Per Share Data - Diluted | |||||||
Net income (loss) per common share -diluted | $ 7.28 | $ (0.07) | $ (0.77) | $ (1.10) | $ 3.19 | $ 6.46 | $ 2.12 |
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands)
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | |
ASSETS Real estate investments | |||||
Property owned | $ 2,266,599 | $ 2,261,220 | $ 2,518,162 | $ 2,524,020 | $ 2,536,166 |
Less accumulated depreciation | (628,285) | (605,402) | (685,769) | (660,124) | (638,217) |
Total real estate investments | 1,638,314 | 1,655,818 | 1,832,393 | 1,863,896 | 1,897,949 |
Cash and cash equivalents | 116,235 | 8,560 | 7,555 | 12,833 | 12,896 |
Restricted cash | 2,846 | 1,883 | 2,710 | 2,818 | 52,943 |
Other assets | 36,635 | 38,993 | 44,928 | 46,620 | 47,516 |
Assets held for sale, net | - | 135,111 | - | - | 86,302 |
TOTAL ASSETS | $ 1,794,030 | $ 1,840,365 | $ 1,887,586 | $ 1,926,167 | $ 2,097,606 |
LIABILITIES, MEZZANINE EQUITY, AND EQUITY | |||||
LIABILITIES | |||||
Accounts payable and accrued expenses | $ 54,048 | $ 51,370 | $ 55,872 | $ 59,247 | $ 66,124 |
Revolving lines of credit | - | 176,000 | 150,429 | 154,925 | 222,500 |
Notes payable, net | 299,623 | 299,608 | 299,594 | 299,579 | 299,564 |
Mortgages payable, net | 512,984 | 513,975 | 565,611 | 566,660 | 622,074 |
Liabilities held for sale, net | - | 1,460 | - | - | 420 |
TOTAL LIABILITIES | $ 866,655 | $ 1,042,413 | $ 1,071,506 | $ 1,080,411 | $ 1,210,682 |
SERIES D PREFERRED UNITS | $ | 5,940 | $ | 5,940 | $ | 5,940 | $ | 5,940 | $ | 5,940 |
EQUITY | ||||||||||
Common Shares of Beneficial Interest | 1,371,928 | 1,369,753 | 1,370,461 | 1,368,834 | 1,366,980 | |||||
Accumulated distributions in excess of net income | (579,173) | (689,530) | (675,493) | (649,678) | (618,341) | |||||
Total shareholders' equity | $ 792,755 | $ 680,223 | $ 694,968 | $ 719,156 | $ 748,639 | |||||
Noncontrolling interests - Operating Partnership and Series E preferred units | 128,680 | 111,789 | 115,172 | 120,660 | 128,038 | |||||
Noncontrolling interests - consolidated real estate entities | - | - | - | - | 4,307 | |||||
TOTAL EQUITY | $ 921,435 | $ 792,012 | $ 810,140 | $ 839,816 | $ 880,984 | |||||
TOTAL LIABILITIES, MEZZANINE EQUITY, AND EQUITY | $ 1,794,030 | $ 1,840,365 | $ 1,887,586 | $ 1,926,167 | $ 2,097,606 | |||||
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (unaudited)
This release contains certain non-GAAP financial measures. The non-GAAP financial measures should not be considered a substitute for operating results determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The definitions and calculations of these non-GAAP financial measures, as calculated by the Company, may not be comparable to non-GAAP measures reported by other REITs that do not define each of the non-GAAP financial measures exactly as Centerspace does. The non-GAAP financial measures are defined and further explained on pages S-17 through S-21, "Non-GAAP Financial Measures and Other Terms."
The Company provides certain information on a same-store and non-same-store basis. Same-store apartment communities are owned or stabilized for substantially all of the periods being compared and, in the case of newly-acquired or constructed communities, have achieved a target level of physical occupancy of 90%, or re-positioned communities when they have achieved stabilized operations. Non-same store communities are communities not owned or stabilized as of the beginning of the previous year, including re-positioned communities, and excluding communities sold, held for sale and the non-multifamily components of mixed-use properties.
On the first day of each calendar year, Centerspace determines the composition of its same-store pool for that year as well as adjusts the previous year, which allows the Company to evaluate the performance of existing apartment communities and their contribution to net operating income ("NOI"). The Company believes that measuring performance on a same-store basis is useful to investors because it enables evaluation of how a fixed pool of its communities are performing year-over-year. Centerspace uses this measure to assess whether or not the Company has been successful in increasing NOI (defined and reconciled below), raising average rental revenue, renewing leases on existing residents, controlling operating costs, and making prudent capital improvements.
For the comparison of the nine months ended September 30, 2026 and 2025, 44 apartment communities were same-store and three apartment communities were non-same-store. Sold communities are included in "Dispositions," while "Other properties" includes non-multifamily properties and the non-multifamily components of mixed-use properties. During the nine months ended September 30, 2026, the Company disposed of fourteen apartment communities consisting of 1,810 apartment homes. During the year ended December 31, 2025, the Company disposed of 12 apartment communities consisting of 1,511 apartment homes.
RECONCILIATIONS OF OPERATING INCOME TO NET OPERATING INCOME (1)(dollars in thousands)
Three Months Ended | Sequential | Year-Over-Year | ||||
9/30/2026 | 6/30/2026 | 9/30/2025 | $ Change % Change | $ Change | % Change | |
Operating income | $ 151,473 | $ 8,784 | $ 77,210 | $ 142,689 1,624.4 % | $ 74,263 | 96.2 % |
Adjustments: | ||||||
Property management expenses | 1,986 | 2,094 | 2,489 | (108) (5.2)% | (503) | (20.2)% |
Casualty loss, net of recoveries | (441) | (206) | 127 | (235) 114.1 % | (568) | (447.2)% |
Depreciation and amortization | 23,127 | 25,075 | 29,056 | (1,948) (7.8)% | (5,929) | (20.4)% |
Impairment of real estate investments | - | - | 8,676 | - N/A | (8,676) | (100.0)% |
General and administrative expenses | 4,995 | 5,659 | 4,997 | (664) (11.7)% | (2) | - % |
Merger related costs | 5,020 | - | - | 5,020 N/A | 5,020 | N/A |
Gain on sale of real estate and other investments | (150,308) | (271) | (79,531) | (150,037) * | (70,777) | 89.0 % |
Net operating income(1) | $ 35,852 | $ 41,135 | $ 43,024 | $ (5,283) (12.8)% | $ (7,172) | (16.7)% |
Revenue | ||||||
Same-store | $ 49,974 | $ 49,996 | $ 49,965 | $ (22) - % | $ 9 | - % |
Non-same-store | 6,199 | 6,087 | 4,992 | 112 * | 1,207 | * |
Other properties | 793 | 818 | 789 | (25) (3.1)% | 4 | 0.5 % |
Dispositions | 2,549 | 8,881 | 15,653 | (6,332) * | (13,104) | * |
Total | 59,515 | 65,782 | 71,399 | (6,267) (9.5)% | (11,884) | (16.6)% |
Property operating expenses, including real estate taxes | ||||||
Same-store | 20,306 | 18,790 | 19,488 | 1,516 8.1 % | 818 | 4.2 % |
Non-same-store | 2,171 | 2,187 | 2,023 | (16) * | 148 | * |
Other properties | 222 | 264 | 261 | (42) (15.9)% | (39) | (14.9)% |
Dispositions | 964 | 3,406 | 6,603 | (2,442) * | (5,639) | * |
Total | 23,663 | 24,647 | 28,375 | (984) (4.0)% | (4,712) | (16.6)% |
Net operating income(1) | ||||||
Same-store | 29,668 | 31,206 | 30,477 | (1,538) (4.9)% | (809) | (2.7)% |
Non-same-store | 4,028 | 3,900 | 2,969 | 128 * | 1,059 | * |
Other properties | 571 | 554 | 528 | 17 3.1 % | 43 | 8.1 % |
Dispositions | 1,585 | 5,475 | 9,050 | (3,890) * | (7,465) | * |
Total | $ 35,852 | $ 41,135 | $ 43,024 | $ (5,283) (12.8)% | $ (7,172) | (16.7)% |
(1) Net operating income is a non-GAAP measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information. Non-GAAP financial measures should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.
* Not a meaningful percentage.
(dollars in thousands)
Nine Months Ended September 30,
2026 | 2025 | $ Change | % Change | |
Operating income | $ 154,864 | $ 75,160 | $ 79,704 | 106.0 % |
Adjustments: | ||||
Property management expenses | 6,459 | 7,315 | (856) | (11.7)% |
Casualty loss, net of recoveries | (668) | 1,058 | (1,726) | (163.1)% |
Depreciation and amortization | 74,700 | 83,807 | (9,107) | (10.9)% |
Impairment of real estate investments | 9,700 | 23,219 | (13,519) | (58.2)% |
General and administrative expenses | 16,986 | 14,376 | 2,610 | 18.2 % |
Merger related costs | 5,020 | - | 5,020 | N/A |
Gain on sale of real estate and other investments | (150,579) | (79,531) | (71,048) | 89.3 % |
Net operating income(1) | $ 116,482 | $ 125,404 | $ (8,922) | (7.1)% |
Revenue | ||||
Same-store | $ 149,401 | $ 149,429 | $ (28) | - % |
Non-same-store | 18,244 | 8,158 | 10,086 | * |
Other properties | 2,418 | 2,184 | 234 | 10.7 % |
Dispositions | 20,303 | 47,270 | (26,967) | * |
Total | 190,366 | 207,041 | (16,675) | (8.1)% |
Property operating expenses, including real estate taxes | ||||
Same-store | 58,742 | 57,173 | 1,569 | 2.7 % |
Non-same-store | 6,725 | 3,462 | 3,263 | * |
Other properties | 767 | 773 | (6) | (0.8)% |
Dispositions | 7,650 | 20,229 | (12,579) | * |
Total | 73,884 | 81,637 | (7,753) | (9.5)% |
Net operating income(1) | ||||
Same-store | 90,659 | 92,256 | (1,597) | (1.7)% |
Non-same-store | 11,519 | 4,696 | 6,823 | * |
Other properties | 1,651 | 1,411 | 240 | 17.0 % |
Dispositions | 12,653 | 27,041 | (14,388) | * |
Total | $ 116,482 | $ 125,404 | $ (8,922) | (7.1)% |
(1) Net operating income is a non-GAAP measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information. Non-GAAP financial measures should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.
* Not a meaningful percentage.
RECONCILIATIONS OF SAME-STORE CONTROLLABLE EXPENSES TO TOTAL PROPERTY OPERATING EXPENSES, INCLUDING REAL ESTATE TAXES (1)(dollars in thousands)
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2026 | 2025 | $ Change | % Change | 2026 | 2025 | $ Change | % Change | |
Same-store controllable expenses | ||||||||
On-site compensation(2) | $ 5,318 | $ 5,092 | $ 226 | 4.4 % | $ 15,353 | $ 15,088 | $ 265 | 1.8 % |
Repairs and maintenance(3) | 3,293 | 3,255 | 38 | 1.2 % | 8,313 | 8,125 | 188 | 2.3 % |
Utilities | 3,290 | 2,987 | 303 | 10.1 % | 9,355 | 8,871 | 484 | 5.5 % |
Administrative and marketing | 1,250 | 1,330 | (80) | (6.0)% | 3,867 | 3,653 | 214 | 5.9 % |
Total | $ 13,151 | $ 12,664 | $ 487 | 3.8 % | $ 36,888 | $ 35,737 | $ 1,151 | 3.2 % |
Same-store non-controllable expenses | ||||||||
Real estate taxes | $ 5,235 | $ 4,845 | $ 390 | 8.0 % | $ 16,224 | $ 15,995 | $ 229 | 1.4 % |
Insurance | 1,920 | 1,979 | (59) | (3.0)% | 5,630 | 5,441 | 189 | 3.5 % |
Total | $ 7,155 | $ 6,824 | $ 331 | 4.9 % | $ 21,854 | $ 21,436 | $ 418 | 1.9 % |
Total property operating expenses, including real estate taxes - same-store | $ 20,306 | $ 19,488 | $ 818 | 4.2 % | $ 58,742 | $ 57,173 | $ 1,569 | 2.7 % |
Property operating expenses, including real estate taxes - non-same-store | $ 2,171 | $ 2,023 | $ 148 | * | $ 6,725 | $ 3,462 | $ 3,263 | * |
Property operating expenses, including real estate taxes - other properties | 222 | 261 | (39) | (14.9)% | 767 | 773 | (6) | (0.8)% |
Property operating expenses, including real estate taxes - dispositions | 964 | 6,603 | (5,639) | * | 7,650 | 20,229 | (12,579) | * |
Total property operating expenses, including real estate taxes | $ 23,663 | $ 28,375 | $ (4,712) | (16.6)% | $ 73,884 | $ 81,637 | $ (7,753) | (9.5)% |
Same-store controllable expenses is a non-GAAP measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
On-site compensation for administration, leasing, and maintenance personnel.
Includes turnover expense.
* Not a meaningful percentage.
RECONCILIATIONS OF NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS AND CORE FUNDS FROM OPERATIONS (1)(in thousands, except per share amounts)
Three Months Ended | Nine Months Ended | ||||||
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 9/30/2026 | 9/30/2025 | |
Funds from Operations(1) | |||||||
Net income (loss) available to common shareholders | $ 123,328 | $ (1,020) | $ (12,889) | $ (18,433) | $ 53,783 | $ 109,419 | $ 35,534 |
Adjustments: | |||||||
Noncontrolling interests - Operating Partnership and Series E preferred units | 20,262 | (168) | (2,141) | (3,102) | 9,197 | 17,953 | 6,071 |
Depreciation and amortization | 23,127 | 25,075 | 26,498 | 29,424 | 29,056 | 74,700 | 83,807 |
Less depreciation - non real estate | (64) | (67) | (67) | (83) | (85) | (198) (252) | |
Less depreciation - partially owned entities | - | - | - | - | - | - (43) | |
Impairment of real estate investments | - | - | 9,700 | 14,500 | 8,676 | 9,700 | 23,219 |
(Gain) loss on sale of real estate and other investments | (150,308) | (271) | - | 61 | (79,531) | (150,579) (79,531) | |
Less gain on sale of real estate - partially owned entities | - | - | - | 1 | 2,251 | - | 2,251 |
Loss on sale of non real estate assets | (174) | - | - | (50) | - | (174) - | |
FFO applicable to common shares and Units | $ 16,171 | $ 23,549 | $ 21,101 | $ 22,318 | $ 23,347 | $ 60,821 | $ 71,056 |
Adjustments to Core FFO(1): | |||||||
Non-cash casualty loss (recovery) | (555) | (65) | (193) | 229 | (123) | (813) | 308 |
Loss on extinguishment of debt | 526 | - | - | 95 | 3 | 526 | 3 |
Loss on sale of non real estate assets | 174 | - | - | - | - | 174 | - |
Amortization of assumed debt | 214 | 489 | 365 | 593 | 530 | 1,068 | 1,365 |
Severance and related costs | 197 | 880 | - | - | - | 1,077 | - |
Legal and other costs related to strategic review | 126 | 127 | 977 | 1,336 | - | 1,230 | - |
Merger related costs | 5,020 | - | - | - | - | 5,020 | - |
Other miscellaneous items(2) | (34) | - | (209) | (4) | (397) | (243) (96) | |
Core FFO applicable to common shares and Units | $ 21,839 | $ 24,980 | $ 22,041 | $ 24,567 | $ 23,360 | $ 68,860 | $ 72,636 |
FFO applicable to common shares and Units | $ 16,171 | $ 23,549 | $ 21,101 | $ 22,318 | $ 23,347 | $ 60,821 | $ 71,056 |
Distributions to Series D preferred unitholders | 57 | 58 | 57 | 57 | 109 | 172 | 429 |
FFO applicable to common shares and Units - diluted | $ 16,228 | $ 23,607 | $ 21,158 | $ 22,375 | $ 23,456 | $ 60,993 | $ 71,485 |
Core FFO applicable to common shares and Units | $ 21,839 | $ 24,980 | $ 22,041 | $ 24,567 | $ 23,360 | $ 68,860 | $ 72,636 |
Distributions to Series D preferred unitholders | 57 | 58 | 57 | 57 | 109 | 172 | 429 |
Core FFO applicable to common shares and Units - diluted | $ 21,896 | $ 25,038 | $ 22,098 | $ 24,624 | $ 23,469 | $ 69,032 | $ 73,065 |
Per Share Data | |||||||
Net income (loss) per share and Unit - diluted | $ 7.28 | $ (0.07) | $ (0.77) | $ (1.10) | $ 3.19 | $ 6.46 | $ 2.12 |
FFO per share and Unit - diluted(1) | $ 0.83 | $ 1.20 | $ 1.07 | $ 1.14 | $ 1.19 | $ 3.10 | $ 3.60 |
Core FFO per share and Unit - diluted(1) | $ 1.11 | $ 1.27 | $ 1.12 | $ 1.25 | $ 1.19 | $ 3.51 | $ 3.68 |
Weighted average shares - basic for net income (loss) | 16,796 | 16,810 | 16,775 | 16,719 | 16,726 | 16,793 | 16,731 |
Effect of operating partnership Units for net income, FFO and Core FFO | 881 | 895 | 914 | 948 | 966 | 897 | 972 |
Effect of Series D preferred units for net income, FFO and Core FFO | 82 | 82 | 82 | 82 | 155 | 82 | 204 |
Effect of Series E preferred units for net income, FFO and Core FFO | 1,877 | 1,883 | 1,892 | 1,894 | 1,898 | 1,884 | 1,903 |
Effect of dilutive restricted stock units and stock options for net income, FFO and Core FFO(3) | 24 | 29 | 29 | 56 | 26 | 26 | 25 |
Weighted average shares and Units for net income, FFO and Core FFO - diluted | 19,660 | 19,699 | 19,692 | 19,699 | 19,771 | 19,682 | 19,835 |
Funds from operations and Core funds from operations are non-GAAP measures. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Consists of (gain) loss on investments and interest rate swap amortization.
Includes participating and nonparticipating restricted stock units.
(in thousands)
Three Months Ended | Nine Months Ended | ||||||
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 9/30/2026 | 9/30/2025 | |
Adjusted EBITDA | |||||||
Net income (loss) attributable to common shareholders | $ 123,328 | $ (1,020) | $ (12,889) | $ (18,433) | $ 53,783 | $ 109,419 | $ 35,534 |
Adjustments: | |||||||
Distributions to Series D preferred unitholders | 57 | 58 | 57 | 57 | 109 | 172 | 429 |
Noncontrolling interests - Operating Partnership and Series E preferred units | 20,262 | (168) | (2,141) | (3,102) | 9,197 | 17,953 | 6,071 |
Income (loss) before noncontrolling interests -Operating Partnership and Series E preferred units | $ 143,647 | $ (1,130) | $ (14,973) | $ (21,478) | $ 63,089 | $ 127,544 | $ 42,034 |
Adjustments: | |||||||
Interest expense | 8,412 | 10,623 | 10,470 | 11,537 | 12,989 | 29,505 | 33,330 |
Loss on extinguishment of debt | 526 | - | - | 95 | 3 | 526 | 3 |
Depreciation and amortization related to real estate investments | 23,127 | 25,075 | 26,498 | 29,424 | 29,056 | 74,700 | 83,764 |
Impairment of real estate investments | - | - | 9,700 | 14,500 | 8,676 | 9,700 | 23,219 |
Non-cash casualty loss (recovery) | (555) | (65) | (193) | 229 | (123) | (813) | 308 |
Interest income | (1,035) | (658) | (644) | (757) | (724) | (2,337) (2,069) | |
(Gain) loss on sale of real estate | (150,482) | (271) | - | 12 | (77,280) | (150,753) (77,280) | |
Severance related costs | 197 | 880 | - | - | - | 1,077 | - |
Legal and other costs related to strategic review | 126 | 127 | 977 | 1,336 | - | 1,230 | - |
Merger related costs | 5,020 | - | - | - | - | 5,020 | - |
Other miscellaneous items(2) | (34) | - | (209) | (4) | (455) | (243) (503) | |
Adjusted EBITDA | $ 28,949 | $ 34,581 | $ 31,626 | $ 34,894 | $ 35,231 | $ 95,156 | $ 102,806 |
Adjusted EBITDA is a non-GAAP measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Consists of (gain) loss on investments.
(in thousands)
Debt Maturity Schedule by ExpirationFuture Maturities of Debt
Secured Fixed Debt | Unsecured Fixed Debt | Unsecured Variable Debt | Total Debt | % of Total Debt | Weighted Average Interest Rate(1) | |
2026 (remainder) | $ - | $ - | $ - $ | - | - % | - % |
2027 | 45,979 | - | - | 45,979 | 5.4 % | 3.47 % |
2028 | 60,000 | 50,000 | - | 110,000 | 13.0 % | 3.10 % |
2029 | 19,108 | 75,000 | - | 94,108 | 11.2 % | 3.94 % |
2030 | - | 85,000 | - | 85,000 | 10.1 % | 2.62 % |
Thereafter | 418,732 | 90,000 | - | 508,732 | 60.3 % | 3.45 % |
Subtotal | 543,819 | 300,000 | - | 843,819 | 100.0 % | 3.37 % |
Premiums and discounts, net | (28,320) | - | - | (28,320) | ||
Deferred financing costs, net | (2,515) | (377) | - | (2,892) | ||
Total debt | $ 512,984 | $ 299,623 | $ - $ | 812,607 |
(1) Weighted average interest rate of debt that matures during the year. | |||||
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | |
Debt Balances Outstanding | |||||
Secured fixed rate - mortgages payable - other | $ 344,969 | $ 346,297 | $ 398,567 | $ 400,134 | $ 455,934 |
Secured fixed rate - mortgages payable - Fannie Mae credit facility | 198,850 | 198,850 | 198,850 | 198,850 | 198,850 |
Unsecured variable rate line of credit | - | 176,000 | 150,429 | 154,925 | 222,500 |
Unsecured senior notes | 300,000 | 300,000 | 300,000 | 300,000 | 300,000 |
Subtotal(1) | $ 843,819 | $1,021,147 | $1,047,846 | $1,053,909 | $1,177,284 |
Premiums and discounts, net | (28,320) | (28,533) | (29,023) | (29,387) | (29,763) |
Deferred financing costs, net | (2,892) | (3,031) | (3,189) | (3,358) | (3,383) |
Debt total | $ 812,607 | $ 989,583 | $1,015,634 | $1,021,164 | $1,144,138 |
Weighted average interest rates | |||||
Mortgages payable - other rate | 3.94 % | 3.94 % | 3.88 % | 3.88 % | 3.87 % |
Mortgages payable - Fannie Mae credit facility rate | 2.78 % | 2.78 % | 2.78 % | 2.78 % | 2.78 % |
Lines of credit rate(2) | 4.87 % | 4.87 % | 4.88 % | 5.12 % | 5.51 % |
Unsecured senior notes rate | 3.12 % | 3.12 % | 3.12 % | 3.12 % | 3.12 % |
Total debt | 3.37 % | 3.63 % | 3.60 % | 3.64 % | 3.80 % |
Excludes premiums, discounts, and deferred financing costs.
Interest rate excludes any unused facility fees and amounts reclassified from accumulated other comprehensive income (loss) into interest expense from terminated interest rate swaps, as shown in the table below.
Three Months Ended
9/30/2026
6/30/2026 3/31/2026 12/31/2025 9/30/2025
Reclassified from Accumulated OCI into interest expense $ - $ - $ - $ - $ 58
CENTERSPACE CAPITAL ANALYSIS(in thousands, except per share and unit amounts)
Three Months Ended
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | |
Equity Capitalization | |||||
Common shares outstanding | 16,824 | 16,792 | 16,803 | 16,761 | 16,703 |
Operating partnership units outstanding | 878 | 882 | 901 | 920 | 963 |
Series E preferred units (as converted) | 1,852 | 1,878 | 1,884 | 1,892 | 1,894 |
Total common shares, Units, and Series E preferred units, as converted, outstanding | 19,554 | 19,552 | 19,588 | 19,573 | 19,560 |
Market price per common share (closing price at end of period) | $ 54.40 | $ 56.19 | $ 57.45 | $ 66.72 | $ 58.90 |
Equity capitalization-common shares and Units | $ 1,063,738 | $ 1,098,627 | $ 1,125,331 | $ 1,305,911 | $1,152,084 |
Series D preferred units | $ 5,940 | $ 5,940 | $ 5,940 | $ 5,940 | $ 5,940 |
Debt Capitalization | |||||
Total debt(1) | $ 843,819 | $ 1,021,147 | $ 1,047,846 | $ 1,053,909 | $1,177,284 |
Total market capitalization | $ 1,913,497 | $ 2,125,714 | $ 2,179,117 | $ 2,365,760 | $2,335,308 |
Total debt to total market capitalization(2) | 44.1 % | 48.0 % | 48.1 % | 44.5 % | 50.4 % |
Excludes deferred financing costs and debt premiums and discounts.
Total debt to total market capitalization is a non-GAAP financial measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Three Months Ended | Nine Months Ended | |||||||
9/30/2026 | 6/30/2026 | 3/31/2026 | 12/31/2025 | 9/30/2025 | 9/30/2026 | 9/30/2025 | ||
Debt service coverage ratio(1) | 2.97 x | 2.86 x | 2.63 x | 2.59 x | 2.35 x | 2.81 x | 2.63 | |
Adjusted EBITDA/Interest expense plus preferred distributions and principal amortization(1) | 2.95 x | 2.84 x | 2.62 x | 2.58 x | 2.33 x | 2.79 x | 2.60 | |
Net debt/Adjusted EBITDA(1) | 6.28 x | 7.32 x | 8.22 x | 7.46 x | 7.90 x | 5.73 x | 8.12 | |
Net debt and preferred equity/Adjusted EBITDA(1) | 6.33 x | 7.36 x | 8.27 x | 7.50 x | 7.94 x | 5.78 x | 8.17 | |
Distribution Data | ||||||||
Common shares and Units outstanding at record date (in thousands) | 17,677 | 17,685 | 17,692 | 17,679 | 17,662 | 17,677 | 17,662 | |
Total common distribution declared (in thousands) | $ 13,611 | $ 13,618 | $ 13,624 | $ 13,613 | $ 13,600 | $ 40,853 | $ 40,875 | |
Common distribution per share and Unit | $ 0.77 | $ 0.77 | $ 0.77 | $ 0.77 | $ 0.77 | $ 2.31 | $ 2.31 | |
Payout ratio (Core FFO per diluted share and unit basis)(1) | 69.4 % | 60.6 % | 68.8 % | 61.6 % | 64.7 % | 65.8 % 62.8 % | ||
Debt service coverage ratio, adjusted EBITDA divided by interest expense plus preferred distributions and principal amortization, net debt divided by adjusted EBITDA, net debt and preferred equity divided by adjusted EBITDA, and payout ratio are non-GAAP financial measures. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
(in thousands, except property data amounts and percentages)
Apartment | Revenues | Expenses | NOI(3) | |||||||
Regions | Included | Q3 2026 | Q3 2025 | % Change | Q3 2026 | Q3 2025 | % Change | Q3 2026 | Q3 2025 | % Change |
Denver, CO | 1,801 | $ 10,871 | $ 11,594 | (6.2)% | $ 4,695 | $ 4,081 | 15.0 % | $ 6,176 | $ 7,513 | (17.8)% |
Minneapolis, MN | 3,433 | 18,019 | 17,779 | 1.3 % | 7,649 | 7,591 | 0.8 % | 10,370 | 10,188 | 1.8 % |
Boulder/Ft. Collins, CO | 559 | 3,365 | 3,450 | (2.5)% | 1,147 | 1,092 | 5.0 % | 2,218 | 2,358 | (5.9)% |
North Dakota(1) | 865 | 4,033 | 3,761 | 7.2 % | 1,502 | 1,495 | 0.5 % | 2,531 | 2,266 | 11.7 % |
Omaha, NE | 872 | 3,928 | 3,832 | 2.5 % | 1,592 | 1,631 | (2.4)% | 2,336 | 2,201 | 6.1 % |
Rochester, MN | 1,129 | 6,382 | 6,217 | 2.7 % | 2,510 | 2,433 | 3.2 % | 3,872 | 3,784 | 2.3 % |
Other Mountain West(2) | 748 | 3,376 | 3,332 | 1.3 % | 1,211 | 1,165 | 3.9 % | 2,165 | 2,167 | (0.1)% |
Same-Store Total | 9,407 | $ 49,974 | $ 49,965 | - % | $ 20,306 | $ 19,488 | 4.2 % | $ 29,668 | $ 30,477 | (2.7)% |
Homes
Weighted Average Occupancy (4)
Average Monthly Rental Rate (4)
Average Monthly Revenue per Occupied Home (4)
Regions | % of NOI | Q3 2026 | Q3 2025 | Growth | Q3 2026 | Q3 2025 | % Change | Q3 2026 | Q3 2025 | % Change |
Denver, CO | 20.8 % | 93.4 % | 94.7 % | (1.3)% | $ 1,978 | $ 1,980 | (0.1)% | $ 2,154 | $ 2,266 | (4.9)% |
Minneapolis, MN | 34.9 % | 95.1 % | 96.3 % | (1.2)% | 1,639 | 1,590 | 3.1 % | 1,839 | 1,792 | 2.6 % |
Boulder/Ft. Collins, CO | 7.5 % | 93.5 % | 96.4 % | (2.9)% | 1,956 | 1,905 | 2.7 % | 2,145 | 2,133 | 0.6 % |
North Dakota(1) | 8.5 % | 97.3 % | 96.1 % | 1.2 % | 1,443 | 1,364 | 5.8 % | 1,598 | 1,508 | 6.0 % |
Omaha, NE | 7.9 % | 94.0 % | 93.9 % | 0.1 % | 1,453 | 1,401 | 3.7 % | 1,598 | 1,560 | 2.4 % |
Rochester, MN | 13.1 % | 96.7 % | 95.8 % | 0.9 % | 1,834 | 1,799 | 1.9 % | 1,948 | 1,916 | 1.7 % |
Other Mountain West(2) | 7.3 % | 95.7 % | 96.3 % | (0.6)% | 1,398 | 1,371 | 2.0 % | 1,571 | 1,542 | 1.9 % |
Same-Store Total | 100.0 % | 95.0 % | 95.7 % | (0.7)% | $ 1,692 | $ 1,653 | 2.4 % | $ 1,865 | $ 1,850 | 0.8 % |
Includes apartment communities in Grand Forks, North Dakota.
Includes apartment communities in Billings, Montana.
NOI is a non-GAAP financial measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for definitions.
(in thousands, except property data amounts and percentages)
Apartment | Revenues | Expenses | NOI(3) | |||||||
Regions | Included | Q3 2026 | Q2 2026 | % Change | Q3 2026 | Q2 2026 | % Change | Q3 2026 | Q2 2026 | % Change |
Denver, CO | 1,801 | $ 10,871 | $ 10,935 | (0.6)% | $ 4,695 | $ 4,133 | 13.6 % | $ 6,176 | $ 6,802 | (9.2)% |
Minneapolis, MN | 3,433 | 18,019 | 18,141 | (0.7)% | 7,649 | 7,053 | 8.5 % | 10,370 | 11,088 | (6.5)% |
Boulder/Ft. Collins, CO | 559 | 3,365 | 3,367 | (0.1)% | 1,147 | 1,174 | (2.3)% | 2,218 | 2,193 | 1.1 % |
North Dakota(1) | 865 | 4,033 | 3,969 | 1.6 % | 1,502 | 1,404 | 7.0 % | 2,531 | 2,565 | (1.3)% |
Omaha, NE | 872 | 3,928 | 3,861 | 1.7 % | 1,592 | 1,483 | 7.3 % | 2,336 | 2,378 | (1.8)% |
Rochester, MN | 1,129 | 6,382 | 6,369 | 0.2 % | 2,510 | 2,409 | 4.2 % | 3,872 | 3,960 | (2.2)% |
Other Mountain West(2) | 748 | 3,376 | 3,354 | 0.7 % | 1,211 | 1,134 | 6.8 % | 2,165 | 2,220 | (2.5)% |
Same-Store Total | 9,407 | $ 49,974 | $ 49,996 | - % | $ 20,306 | $ 18,790 | 8.1 % | $ 29,668 | $ 31,206 | (4.9)% |
Homes
Weighted Average Occupancy (4)
Average Monthly Rental Rate (4)
Average Monthly Revenue per Occupied Home (4)
Regions | % of NOI | Q3 2026 | Q2 2026 | Growth | Q3 2026 | Q2 2026 | % Change | Q3 2026 | Q2 2026 | % Change |
Denver, CO | 20.8 % | 93.4 % | 94.6 % | (1.2)% | $ 1,978 | $ 1,962 | 0.8 % | $ 2,154 | $ 2,140 | 0.7 % |
Minneapolis, MN | 34.9 % | 95.1 % | 96.7 % | (1.6)% | 1,639 | 1,611 | 1.7 % | 1,839 | 1,822 | 0.9 % |
Boulder/Ft. Collins, CO | 7.5 % | 93.5 % | 95.7 % | (2.2)% | 1,956 | 1,921 | 1.8 % | 2,145 | 2,097 | 2.3 % |
North Dakota(1) | 8.5 % | 97.3 % | 97.0 % | 0.3 % | 1,443 | 1,409 | 2.4 % | 1,598 | 1,577 | 1.3 % |
Omaha, NE | 7.9 % | 94.0 % | 94.6 % | (0.6)% | 1,453 | 1,428 | 1.8 % | 1,598 | 1,561 | 2.4 % |
Rochester, MN | 13.1 % | 96.7 % | 97.4 % | (0.7)% | 1,834 | 1,814 | 1.1 % | 1,948 | 1,930 | 0.9 % |
Other Mountain West(2) | 7.3 % | 95.7 % | 95.1 % | 0.6 % | 1,398 | 1,390 | 0.6 % | 1,571 | 1,572 | (0.1)% |
Same-Store Total | 100.0 % | 95.0 % | 96.0 % | (1.0)% | $ 1,692 | $ 1,668 | 1.4 % | $ 1,865 | $ 1,846 | 1.0 % |
Includes apartment communities in Grand Forks, North Dakota.
Includes apartment communities in Billings, Montana.
NOI is a non-GAAP financial measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for definitions.
(in thousands, except property data amounts and percentages)
Apartment | Revenues | Expenses | NOI(3) | |||||||
Regions | Included | 2026 | 2025 | % Change | 2026 | 2025 | % Change | 2026 | 2025 | % Change |
Denver, CO | 1,801 | $ 32,916 | $ 34,836 | (5.5)% | $ 13,136 | $ 12,801 | 2.6 % | $ 19,780 | $ 22,034 | (10.2)% |
Minneapolis, MN | 3,433 | 53,948 | 53,120 | 1.6 % | 22,211 | 21,778 | 2.0 % | 31,737 | 31,342 | 1.3 % |
Boulder/Ft. Collins, CO | 559 | 10,116 | 10,383 | (2.6)% | 3,563 | 3,304 | 7.8 % | 6,553 | 7,079 | (7.4)% |
North Dakota(1) | 865 | 11,834 | 11,181 | 5.8 % | 4,574 | 4,479 | 2.1 % | 7,260 | 6,702 | 8.3 % |
Omaha, NE | 872 | 11,674 | 11,354 | 2.8 % | 4,410 | 4,547 | (3.0)% | 7,264 | 6,807 | 6.7 % |
Rochester, MN | 1,129 | 18,931 | 18,632 | 1.6 % | 7,376 | 6,946 | 6.2 % | 11,555 | 11,686 | (1.1)% |
Other Mountain West(2) | 748 | 9,982 | 9,923 | 0.6 % | 3,472 | 3,318 | 4.6 % | 6,510 | 6,605 | (1.4)% |
Same-Store Total | 9,407 | $ 149,401 | $ 149,429 | - % | $ 58,742 | $ 57,173 | 2.7 % | $ 90,659 | $ 92,255 | (1.7)% |
Homes
Weighted Average Occupancy (4)
Average Monthly Rental Rate (4)
Average Monthly Revenue per Occupied Home (4)
Regions | % of NOI | 2026 | 2025 | Growth | 2026 | 2025 | % Change | 2026 | 2025 | % Change |
Denver, CO | 21.8 % | 93.9 % | 94.4 % | (0.5)% | $ 1,971 | $ 1,999 | (1.4)% | $ 2,162 | $ 2,276 | (5.0)% |
Minneapolis, MN | 35.1 % | 96.0 % | 96.5 % | (0.5)% | 1,618 | 1,581 | 2.3 % | 1,820 | 1,782 | 2.1 % |
Boulder/Ft. Collins, CO | 7.2 % | 94.9 % | 96.1 % | (1.2)% | 1,930 | 1,906 | 1.3 % | 2,119 | 2,148 | (1.4)% |
North Dakota(1) | 8.0 % | 96.8 % | 97.1 % | (0.3)% | 1,417 | 1,333 | 6.3 % | 1,571 | 1,479 | 6.2 % |
Omaha, NE | 8.0 % | 94.7 % | 94.1 % | 0.6 % | 1,436 | 1,391 | 3.2 % | 1,571 | 1,538 | 2.1 % |
Rochester, MN | 12.7 % | 97.0 % | 96.7 % | 0.3 % | 1,818 | 1,780 | 2.1 % | 1,920 | 1,897 | 1.2 % |
Other Mountain West(2) | 7.2 % | 94.9 % | 96.4 % | (1.5)% | 1,390 | 1,364 | 1.9 % | 1,562 | 1,529 | 2.2 % |
Same-Store Total | 100.0 % | 95.5 % | 95.8 % | (0.3)% | $ 1,675 | $ 1,646 | 1.8 % | $ 1,849 | $ 1,842 | 0.4 % |
Includes apartment communities in Grand Forks, North Dakota.
Includes apartment communities in Billings, Montana.
NOI is a non-GAAP financial measure. Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for additional information.
Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for definitions.
Number of Apartment Homes at Period End
As of and for the Three Months Ended
9/30/2026 6/30/2026 3/31/2026 12/31/2025 9/30/2025
Same-Store | 9,407 | 9,407 | 11,214 | 11,084 | 11,084 |
Non-Same-Store and Held for Sale(2) | 1,049 | 2,683 | 1,049 | 1,178 | 1,178 |
All Communities(2) | 10,456 | 12,090 | 12,263 | 12,262 | 12,262 |
Average Monthly Rental Rate(3) | |||||
Same-Store | $ 1,692 | $ 1,668 | $ 1,643 | $ 1,639 | $ 1,629 |
Non-Same-Store and Held for Sale(2) | 1,874 | 1,662 | 1,848 | 1,842 | 1,858 |
All Communities(2) | $ 1,710 | $ 1,666 | $ 1,660 | $ 1,658 | $ 1,649 |
Average Monthly Revenue per Occupied Apartment Home(3 | ) | ||||
Same-Store | $ 1,865 | $ 1,846 | $ 1,813 | $ 1,818 | $ 1,823 |
Non-Same-Store and Held for Sale(2) | 2,067 | 1,840 | 2,058 | 2,080 | 2,090 |
All Communities(2) | $ 1,881 | $ 1,844 | $ 1,834 | $ 1,843 | $ 1,846 |
Weighted Average Occupancy(3) | |||||
Same-Store | 95.0 % | 96.0 % | 95.4 % | 95.3 % | 95.8 % |
Non-Same-Store and Held for Sale(2) | 95.3 % | 95.9 % | 92.0 % | 89.7 % | 87.5 % |
All Communities(2) | 95.2 % | 96.0 % | 95.1 % | 94.7 % | 95.0 % |
Property Operating Expenses, including Real Estate Taxes as a % of | |||||
Scheduled Rent(3) | |||||
Same-Store | 40.6 % | 39.9 % | 41.5 % | 38.3 % | 41.6 % |
Non-Same-Store and Held for Sale(2) | 35.0 % | 38.8 % | 40.7 % | 39.3 % | 42.6 % |
All Communities(2) | 40.0 % | 39.7 % | 41.4 % | 38.4 % | 41.7 % |
Capital Expenditures
Total Recurring Capital Expenditures(3) per Apartment Home - Same-
Store $ 452 $ 303 $ 198 $ 269 $ 350
Previously reported amounts are not revised for changes in the composition of the same-store properties pool.
Includes apartment communities classified as held for sale as of June 30, 2026 and excludes apartment communities classified as held for sale as of September 30, 2025, and June 30, 2025.
Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for definitions.
(dollars in thousands, except per home amounts)
Three Months Ended | Nine Months Ended | |||
Capital Expenditures | 9/30/2026 | 9/30/2025 | 9/30/2026 | 9/30/2025 |
Total Same-Store Apartment Homes | 9,407 | 9,406 | 9,407 | 9,406 |
All Properties - Weighted Average Apartment Homes(3) | 10,919 | 13,281 | 11,695 | 13,140 |
Same-Store | ||||
Building - Exterior | $ 1,688 | $ 870 | $ 2,623 | $ 2,210 |
Building - Interior | 16 | 16 | 113 | 165 |
Mechanical, Electrical, & Plumbing | 642 | 646 | 1,798 | 1,519 |
Furniture & Equipment | 83 | 206 | 236 | 418 |
Landscaping & Grounds | 315 | 537 | 582 | 758 |
Turnover Replacements | 961 | 908 | 2,485 | 2,212 |
Work in progress - net change | 549 | 434 | 1,067 | 894 |
Recurring Capital Expenditures(1) - Same-Store | $ 4,254 | $ 3,617 | $ 8,904 | $ 8,176 |
Recurring Capital Expenditures(1) per Apartment Home - Same-Store | $ 452 | $ 385 | $ 947 | $ 869 |
Recurring Capital Expenditures(1) - All Properties | $ 4,364 | $ 4,389 | $ 10,096 | $ 11,712 |
Recurring Capital Expenditures(1) per Weighted Average Apartment Home - All Properties
$
400 $
330 $
863 $
891
Value Add(1)
Same-Store | ||||
Interior - Units | $ 1,509 | $ 913 | $ 2,111 | $ 1,932 |
Common Areas and Exteriors | 177 | 2,526 | 2,283 | 4,202 |
Work in Progress - net change | (1,026) | (229) | (894) | 119 |
Total Value Add - Same Store | $ 660 | $ 3,210 | $ 3,500 | $ 6,253 |
All Properties | ||||
Interior - Units | $ 1,537 | $ 1,580 | $ 2,138 | $ 3,920 |
Common Areas and Exteriors | 178 | 2,789 | 2,825 | 5,227 |
Work in Progress - net change | (1,047) | (184) | (1,077) (13) | |
Total Value Add - All Properties | $ 668 | $ 4,185 | $ 3,886 $ 9,134 | |
Total Same-Store Capital Spend(2) | ||||
Capital Spend - Same-Store(2) | $ 4,914 | $ 6,827 | $ 12,404 | $ 14,429 |
Capital Spend per Apartment Home - Same-Store(2) | $ 522 | $ 726 | $ 1,319 | $ 1,534 |
Acquisition and Other Capital Expenditures(1) | |
All Properties $ 1,002 $ 805 | $ 4,995 $ 3,460 |
Total Capital Spend
Total Capital Spend - All Properties | $ 6,034 | $ 9,379 | $ 18,977 | $ 24,306 |
Total Capital Spend per Weighted Average Apartment Home - All Properties | $ 553 | $ 706 | $ 1,623 | $ 1,850 |
Refer to pages S-17 through S-21 "Non-GAAP Financial Measures and Other Terms" for definitions.
Includes value-add and excludes acquisition and other capital expenditures on same-store communities.
Includes all properties, including held for sale and dispositions for the period owned.
NON-GAAP FINANCIAL MEASURES AND OTHER TERMS
Acquisition and Other Capital ExpendituresAcquisition and other non-routine capital expenditures represent capital additions contemplated in the underwriting at recently acquired communities. These amounts are considered when determining expected returns. Other capital expenditures includes casualty and other non-routine capital items including, but not limited to, tenant improvements, real estate special assessments, and capital expenditures incurred to dispose of properties. Casualty represents capitalized costs incurred in connection with the restoration of an apartment community after a casualty event.
Adjusted EBITDAAdjusted EBITDA is earnings before interest, taxes, depreciation, amortization, gain/loss on sale of real estate and other investments, impairment of real estate investments, gain/loss on extinguishment of debt, gain/loss from involuntary conversion; and other non-routine items or items not considered core to business operations. The Company considers Adjusted EBITDA to be an appropriate supplemental performance measure because it permits investors to view income from operations without the effect of depreciation, financing costs, or non-operating gains and losses. Adjusted EBITDA is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP.
Average Monthly Rental RateAverage monthly rental rate is scheduled rent divided by the total number of apartment homes.
Average Monthly Revenue per Occupied HomeAverage monthly revenue per occupied home is defined as total rental revenues divided by the weighted average occupied apartment homes for the period.
Debt Service Coverage RatioDebt service coverage ratio is computed by dividing Adjusted EBITDA by interest expense and principal amortization. This term is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition included within this Non-GAAP Financial Measures and Other Terms section.
As of and for the
9/30/2026 | Three Months Ended 6/30/2026 3/31/2026 12/31/2025 | 9/30/2025 | Nine Months Ended 9/30/2026 9/30/2025 | ||||
Adjusted EBITDA | $ 28,949 | $ 34,581 | $ 31,626 | $ 34,894 | $ 35,231 | $ 95,156 | $ 102,806 |
Interest Expense | 8,412 | 10,623 | 10,470 | 11,537 | 12,989 | 29,505 | 33,330 |
Principal Amortization | 1,328 | 1,488 | 1,567 | 1,939 | 2,000 | 4,383 | 5,759 |
Total Interest Expense and Principal Amortization | 9,740 | 12,111 | 12,037 | 13,476 | 14,989 | 33,888 | 39,089 |
Distributions paid to Series D preferred unitholders | 57 | 58 | 57 | 57 | 109 | 172 | 429 |
Total Interest Expense, Principal Amortization, and preferred distributions | 9,797 | 12,169 | 12,094 | 13,533 | 15,098 | 34,060 | 39,518 |
Debt Service Coverage Ratio | 2.97 | 2.86 | 2.63 | 2.59 | 2.35 | 2.81 | 2.63 |
Adjusted EBITDA/Interest expense plus preferred distributions and principal amortization | 2.95 | 2.84 | 2.62 | 2.58 | 2.33 | 2.79 | 2.60 |
Effective blended lease rate growth is the weighted average of effective new lease rate growth and effective renewal lease rate growth within the given timeframe.
Effective New Lease Rate GrowthEffective new lease rate growth is the growth in gross rents after the effect of leasing concessions for new leases that became effective within the given timeframe as compared to the prior lease.
Effective Renewal Lease Rate GrowthEffective renewal lease rate growth is the growth in gross rents after the effect of leasing concessions for renewal leases that became effective within the given timeframe as compared to the prior lease.
Funds From Operations and Core Funds From OperationsThe Company believes that FFO, which is a non-GAAP financial measure used as a standard supplemental measure for equity real estate investment trusts, is helpful to investors in understanding its operating performance, primarily because its calculation does not assume that the value of real estate assets diminishes predictably over time, as implied by the historical cost convention of GAAP and the recording of depreciation and amortization.
The Company uses the definition of FFO adopted by the National Association of Real Estate Investment Trusts, Inc. ("Nareit"). Nareit defines FFO as net income or loss calculated in accordance with GAAP, excluding:
depreciation and amortization related to real estate;
gains and losses from the sale of certain real estate assets;
gains and losses from change in control;
impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity; and
similar adjustments for partially owned consolidated real estate entities.
The exclusion in Nareit's definition of FFO of gains and losses from the sale of real estate assets and impairment write-downs helps to identify the operating results of the long-term assets that form the base of the Company's investments, and assists management and investors in comparing those operating results between periods.
Due to the limitations of the Nareit FFO definition, Centerspace has made certain interpretations in applying this definition. The Company believes that all such interpretations not specifically identified in the Nareit definition are consistent with this definition. Nareit's FFO White Paper 2018 Restatement clarified that impairment write-downs of land related to a REIT's main business are excluded from FFO and a REIT has the option to exclude impairment write-downs of assets that are incidental to its main business.
While FFO is widely used by Centerspace as a primary performance metric, not all real estate companies use the same definition of FFO or calculate FFO in the same way. Accordingly, FFO presented here is not necessarily comparable to FFO presented by other real estate companies. FFO should not be considered as an alternative to net income (loss) or any other GAAP measurement of performance, but rather should be considered as an additional, supplemental measure. FFO also does not represent cash generated from operating activities in accordance with GAAP, nor is it indicative of funds available to fund all cash flow needs, including the ability to service indebtedness or make distributions to shareholders.
Core Funds from Operations ("Core FFO"), a non-GAAP measure, is FFO as adjusted for non-routine items or items not considered core to business operations. By further adjusting for items that are not considered part of core business operations, the Company believes that Core FFO provides investors with additional information to compare core operating and financial performance between periods. Core FFO should not be considered as an alternative to net income (loss), or any other GAAP measurement of performance, but rather should be considered an additional supplemental measure. Core FFO also does not represent cash generated from operating activities in accordance with GAAP, nor is it indicative of funds available to fund the Company's cash needs, including its ability to service indebtedness or make distributions to shareholders. Core FFO is a non-GAAP and non-standardized financial measure that may be calculated differently by other REITs and should not be considered a substitute for operating results determined in accordance with GAAP.
Held For SaleThe Company classifies properties as held for sale when they meet the GAAP criteria, which include: (a) management commits to and initiates a plan to sell the asset; (b) the sale is probable and expected to be completed within one year under terms that are usual and customary for sales of such assets; and (c) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The Company generally considers these criteria met when the transaction has been approved by its Board of Trustees, there are no known significant contingencies related to the sale, and management believes it is probable that the sale will be completed within one year.
Net Debt Divided by Adjusted EBITDANet debt is the total outstanding debt balance less cash and cash equivalents and net tax deferred proceeds held in restricted cash for exchanges under section 1031(b) of the Internal Revenue Code. Preferred equity is the value of Series D preferred units outstanding. Adjusted EBITDA is annualized for periods less than one year. Net debt and adjusted EBITDA are non-GAAP financial measures and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition included within this Non-GAAP Financial Measures and Other Terms section.
9/30/2026 | Three Months Ended 6/30/2026 3/31/2026 12/31/2025 | 9/30/2025 | Nine Months Ended 9/30/2026 9/30/2025 | ||
Total debt(1) | $ 843,819 | $ 1,021,147 $ 1,047,846 $ 1,053,909 | $ 1,177,284 | $ 843,819 | $ 1,177,284 |
Less: cash and cash equivalents | 116,235 | 8,560 7,555 12,833 | 12,896 | 116,235 | 12,896 |
Less: 1031 funds in restricted cash | - | - - - | 50,941 | - | 50,941 |
Net debt | $ 727,584 | $ 1,012,587 $ 1,040,291 $ 1,041,076 | $ 1,113,447 | $ 727,584 $ 1,113,447 | |
Adjusted EBITDA(2) | $ 115,796 | $ 138,324 $ 126,504 $ 139,576 | $ 140,924 | $ 126,875 | $ 137,075 |
Net debt/Adjusted EBITDA | 6.28 | 7.32 8.22 7.46 | 7.90 | 5.73 8.12 | |
Preferred Equity | $ 5,940 | $ 5,940 $ 5,940 $ 5,940 | $ 5,940 | $ 5,940 | $ 5,940 |
Net debt and preferred equity | $ 733,524 | $ 1,018,527 $ 1,046,231 $ 1,047,016 | $ 1,119,387 | $ 733,524 | $ 1,119,387 |
Adjusted EBITDA(2) | $ 115,796 | $ 138,324 $ 126,504 $ 139,576 | $ 140,924 | $ 126,875 | $ 137,075 |
Net debt and preferred equity/Adjusted EBITDA | 6.33 | 7.36 8.27 7.50 | 7.94 | 5.78 8.17 | |
Excludes premiums, discounts, and deferred financing costs.
Annualized for periods less than one year.
Net operating income, or NOI, is a non-GAAP financial measure which the Company defines as total real estate revenues less property operating expenses, including real estate taxes. The Company believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that excludes gain (loss) on the sale of real estate and other investments, impairment, depreciation and amortization, financing costs, including interest and other income, losses on extinguishment of debt, and interest expense, property management expenses, casualty losses net of recoveries, loss on litigation settlement, merger related costs, and general and administrative expenses. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.
Non-stabilized CommunityA non-stabilized community is a development community that is either currently under construction or undergoing lease-up or is a recent acquisition prior to reaching overall occupancy of 90%.
Payout Ratio (Core FFO per Diluted Share and Unit Basis)Payout ratio (Core FFO per diluted share and unit basis) is the ratio of the current quarterly or annual distribution rate per common share and unit divided by quarterly or annual Core FFO per diluted share and unit. This term is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Core FFO definition included within this Non-GAAP Financial Measures and Other Terms section.
Three Months Ended | Nine Months Ended | ||||
9/30/2026 | 6/30/2026 3/31/2026 12/31/2025 | 9/30/2025 | 9/30/2026 9/30/2025 | ||
Common distribution per share and unit | $ 0.77 | $ 0.77 $ 0.77 $ 0.77 | $ 0.77 | $ 2.31 | $ 2.31 |
Core FFO per common share and unit diluted | 1.11 | 1.27 1.12 1.25 | 1.19 | 3.51 | 3.68 |
Payout ratio | 69.4 % | 60.6 % 68.8 % 61.6 % | 64.7 % | 65.8 % 62.8 % | |
Recurring capital expenditures represent expenditures necessary to help preserve the value of and maintain the functionality at communities. Property recurring capital expenditures are necessary to maintain asset quality, including purchasing and replacing items used to operate the communities such as appliances, mechanical equipment, flooring to roof replacement, paving, siding, and major landscaping.
Repositioned CommunityThe Company defines a re-positioned community as having significant development and construction activity on existing buildings pursuant to an authorized plan, which has an impact on current operating results, occupancy and the ability to lease space with the intended result of improved community cash flow and competitive position through extensive unit and amenity upgrades. We categorize a re-positioned community as same-store when the development and construction activity has been completed, and operations have stabilized. This is typically reaching an overall occupancy of 90%. Not all communities undergoing value add are considered a re-positioned community.
Retention RateRetention rate is the percentage of leases expiring within the given timeframe that were converted to a term renewal.
Same-Store Controllable ExpensesThe Company defines same-store controllable expenses as property operating expenses excluding real estate taxes and insurance. Same-store controllable expenses exclude real estate taxes and insurance, in order to provide a measure of expenses that are within management's control, and is used for the purposes of budgeting, business planning, and performance evaluation. This is a non-GAAP financial measure and should not be considered an alternative to total expenses or total property operating expenses and real estate taxes.
Scheduled Rental RevenueScheduled rental revenue represents the value of all apartment homes, with occupied apartment homes valued at contractual rental rates pursuant to leases and vacant apartment homes valued at estimated market rents. When calculating actual rents for occupied apartment homes and market rents for vacant homes, delinquencies and concessions are not taken into account. Market rates are determined using the currently offered effective rates on new leases at the community and are used as the starting point in determination of the market rates of vacant apartment homes.
Stabilized CommunityThe Company defines stabilized communities as communities past development lease-up or a recent acquisition reaching an overall occupancy of 90%. A re-positioned community is considered stabilized when substantial redevelopment activities are complete and operations have stabilized. This is typically reaching an overall occupancy of 90% occupancy or is consistent occupancy for 90 days.
Total Debt to Total Market CapitalizationTotal debt to total market capitalization, a non-GAAP financial measure, is total debt not adjusted for unamortized deferred financing costs or unamortized debt premiums and discounts from the balance sheet divided by the sum of total debt from the balance sheet, market value of common shares, operating partnership units, and the as converted Series E preferred units, and Series D preferred units outstanding at the end of the period. This non-GAAP financial measure should not be considered a substitute for operating results determined in accordance with GAAP.
Value AddValue add represents expenditures that are expected to result in increased income generation or decreased expense growth over time to improve a community's cash flow and competitive position. This includes elective capital expenditures such as full-scale renovations including new amenities, interior unit turn renovations, enhanced clubhouses and common area hallways and certain resource management initiatives including smart home automation as well as environmental and sustainability initiatives for higher rental levels or expense savings in their respective markets.
Weighted Average OccupancyWeighted average occupancy is defined as the percentage resulting from dividing actual rental revenue by scheduled rental revenue. Scheduled rental revenue represents the value of all apartment homes, with occupied homes valued at contractual rental rates pursuant to leases and vacant apartment homes valued at estimated market rents. When calculating actual rents for occupied apartment homes and market rents for vacant homes, delinquencies and concessions are not taken into account. Market rates are determined using the currently offered effective rates on new leases at the community and are used as the starting point in determination of the market rates of vacant apartment homes. The Company believes that weighted average occupancy is a meaningful measure of occupancy because it considers the value of each vacant unit at its estimated market rate. Weighted average occupancy may not completely reflect short-term trends in physical occupancy, and the calculation of weighted average occupancy may not be comparable to that disclosed by other REITs and other real estate companies.