Veris Residential, Inc. Q3 FY2025 earnings call

• Strong operational performance with blended net rental growth of 3.9% and core FFO per share of $0.20.
• Exceeded non-strategic asset sales target with $542 million of sales closed or under contract, raising target to $650 million.
• Harborside 8/9 expected to close early next year, contributing to deleveraging.
• GRESB score improved by 1 point to 90, maintaining 5-star rating and top rank in peer group.
• Portfolio outperformance with same store rental growth, and New Jersey properties strong due to location and amenities.
• Technology investments through PRISM driving customer experience and operational efficiency, with controllable expenses growth at 1.9% year-to-date.

Veris Residential's portfolio showed strong performance. Same store blended net rental growth was 3.9% for the quarter, with 3.6% in new leases and 4.3% in renewals. For the first 9 months, same store blended net rental growth was 3.5%. Average revenue per home was $4,255. Occupancy excluding Liberty Towers was 95.8%, and including Liberty Towers (over 85% occupied) was 94.7%. New Jersey properties benefited from strong fundamentals. The Jersey City Waterfront portfolio had new lease net blended rental growth of 6% in the third quarter. Revenue contribution details weren't explicitly broken down by product segment beyond the portfolio performance.

• Raised core FFO guidance to $0.67 to $0.68 per share, 12.5% above 2024.
• Affirmed same-store NOI guidance of 2% to 2.8%.
• Anticipate deleveraging to below 8x net debt-to-EBITDA by end of 2026 through divesting non-strategic assets as per revised $650 million target.

• National multifamily market has weakened in select markets due to influx of new supply, with rents slowing in September.
• Softening labor markets, declining consumer sentiment, and stringent immigration policies present headwinds to the sector.
• Impact of international student enrollment decline limited but still a factor for some portfolios.

Q: Jana Galan asked about same-store guidance ranges and timing-related items impacting 4Q.

A: Amanda Lombard said Q3 same-store NOI growth was an anomaly due to expense reset, and Q4 has limited exposure with low expense growth trend continuing.

Q: Sanketkumar Agrawal asked about leverage target path forward.

A: Mahbod Nia said focus is on executing the plan, continuing operational performance, and evaluating options for creating value.

Q: Eric Wolfe asked about disposition and stock repurchases.

A: Mahbod Nia discussed disposition progress and prioritization of deleveraging over stock repurchases for now.

Q: William Catherwood asked about transactions closed vs initial plan.

A: Mahbod Nia said sales were as expected, with prices and sales in line with initial expectations.