IRT

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 9:00 a.m. ET Chairman and Chief Executive Officer - Scott Schaeffer President and Chief Financial Officer - James Sebra Executive Vice President of Revenue Strategy - Janice Richards Senior Vice President of Investments - Jason Lynch Senior Vice President of Investor Relations - Stephanie Krewson-Kelly Operator: Good morning, ladies and gentlemen, and welcome to Independence Realty Trust's Second Quarter 2026 Earnings Conference Call. As a reminder, today's call is being recorded, and the replay will be available on the Investors section of the company's website shortly after this call concludes. At this time, I will turn the call over to Stephanie Krewson-Kelly, Senior Vice President of Investor Relations. Ms. Krewson-Kelly, please go ahead. Stephanie Krewson-Kelly: Thank you. Good morning, and welcome to Independence Realty Trust conference call to discuss second quarter 2026 results. On the call with me today are Scott Schaeffer, Chairman and Chief Executive Officer; Jim Sebra, President and Chief Financial Officer; Janice Richards, Executive Vice President of Revenue Strategy; and Jason Lynch, Senior Vice President of Investments. Before we begin, please note that any forward-looking statements made during this call are based on our current expectations and beliefs as to future events and financial performance. These statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially. Such statements are made in good faith pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and IRT does not undertake to update them, except as may be required by law. Please refer to IRT's press release, supplemental information and filings with the SEC for further information about these risks. A copy of IRT's earnings press release and supplemental information is attached to IRT's current report on the Form 8-K that is available in the Investors section of our website. They contain reconciliations of non-GAAP financial measures referenced on this call to the most direct comparable GAAP financial measure. With that, it's my pleasure to turn the call over to Scott Schaeffer. Scott Schaeffer: Thanks, Stephanie, and thank you all for joining us this morning. I am pleased to report that operating momentum is building across our portfolio as market conditions continue to improve. As our results demonstrate, rental rate growth has improved throughout the year, driving a 120 basis point sequential improvement in new lease rates during the second quarter with further improvement in July. Additionally, as of today, with 65% of new lease activity completed for the month of August, new lease spreads for like-kind leases are slightly positive. The consistent upward trajectory in leasing spreads is a clear signal that our markets are in recovery, which when combined with the new WiFi revenue stream that we have established, supports our confidence in our guidance for same-store revenue growth. As expected, the volume of new deliveries has declined in our markets and macroeconomic drivers of demand continue to outpace national averages. Recent employment data continues to highlight health care as the primary driver of national job gains over the past year. This is visible across our footprint. Education and health care employment grew faster than total employment in every one of our 10 largest markets over the trailing year, aligning with our residents' income profile. People continue to relocate to the Sunbelt and Midwest markets for employment opportunities and quality of life. The high cost of homeownership continues to support rental demand and IRT's value proposition, namely larger apartment units, good school districts, proximity to essential retail and employment centers with monthly rents that are meaningfully less than new construction continues to attract and retain residents. Bearing this point, the steady improvement in market conditions has resulted in greater lead generation volumes over last year and a decrease in concession use. Importantly, overall market occupancies across our portfolio have generally reached levels that support market-wide rent growth. The combination of durable demand, rising market rents and normalizing concessions has driven sequential improvement in rental rates that I mentioned earlier. New lease trade-outs for like-term leases at our Midwest communities were positive 2.3% in the second quarter and a positive 2.1% in July. New lease spreads at our Sunbelt communities were a negative 3.8% in the second quarter and improved 180 basis points in July. And in the West, new lease trade-outs were a negative 3.2% in the second quarter and improved 340 basis points to a positive 20 basis points in July. Taken together, net effective rental rate growth in our markets is gaining steam. With the recovery that is upon us, rent premiums from our value-add activity will also increase. Because we perform a full repositioning of the apartment community, our renovated properties successfully compete with newer Class A properties by offering modern interiors and attractive on-site amenities at a lower price point than new construction while delivering a mid- to upper teens return on investment. Our approach to value-add renovations enables us to capture an immediate rent premium and benefit longer term from lower repairs and maintenance and turn costs. The higher rents and lower operating costs realized on renovated units has expanded our NOI margins and boosted same-store NOI by more than 20% annually. Additionally, over the past 2 years, we have significantly decreased the time it takes to renovate units such that moving forward, we can increase the volume of value-add renovations without impacting occupancy, further benefiting future NOI growth. Lastly, as I referenced at the beginning of my remarks, during the quarter, we successfully completed the initial phase of our community WiFi initiative ahead of schedule. This new revenue stream not only supports our outlook for same-store revenue growth this year, but will also contribute at least one incremental $0.01 of core FFO per share to next year's results. In short, our markets are in recovery. We are on track to achieve our 2026 guidance, and we are excited about the earnings momentum building towards 2027. With that, I'll turn the call over to Jim. James Sebra: Thank you, Scott, and good morning, everyone. Core FFO per share for the second quarter of $0.28 was ahead of our internal expectations, driven by stronger-than-expected same-store NOI growth of 1.2% that outpaced the 80 basis point midpoint of our original guidance range for this year. The outperformance was driven by stronger revenue growth and lower expense growth. Same-store revenue growth of 90 basis points in the quarter was led by a 7.3% increase in other property revenue, along with continued improvement in [ bad debt ], which declined to 1.1% of total revenue from 1.3% in the prior year period. Average occupancy of 95% was down 20 basis points sequentially and reflected our deliberate strategy of capturing rental rates over occupancy to maximize revenue. Looking ahead, revenues from our community WiFi program will contribute significantly to other property revenue and same-store revenue growth during the second half of 2026. More on this in a moment. Rental rate growth in the quarter was fueled by a combination of stable asking rents and declining concession use. Asking rents across our markets increased by 3% from January through May and have held steady since. As demand strengthened during the year, we were able to reduce concession use from 54% of new leases in April to approximately 28% in July. As a result, like-term new lease trade-outs have improved throughout the year from negative 3.9% in the first quarter to negative 2.7% in the second quarter and negative 1.1% in July. Finally, as Scott mentioned, with over 65% of our expected new leases signed for the month of August, new lease trade-outs for like-term leases are slightly positive. While this is early, we are excited to see the continued improvement of market fundamentals translate into better pricing power. We provided July and August data in today's prepared remarks. However, investors should not expect monthly data to continue to be presented on future calls. We are only providing this detail since, one, new lease trade-outs are in focus right now; and two, this activity helps investors understand the momentum that is building, and our confidence in achieving our guidance, which we will discuss momentarily. Regarding individual markets and new lease growth, 7 markets had positive new lease trade-outs during the second quarter. 11 were positive in July. And so far in August, 13 markets are seeing positive new lease spreads. Markets with the highest new lease trade-outs in the second quarter were Lexington at a positive 9.6%, Cincinnati with 4.6%, Charleston with 1.8%, Columbus and Oklahoma City, both with positive 1.1%, San Antonio with 1% and Louisville with 30 basis points of positive spread. Looking at our largest market, Atlanta's new lease trade-outs were negative 3.4% during the second quarter, and they accelerated to a positive 2% in July. On renewal leases, our data science efforts are supporting lower renewal concession use and higher effective renewal rates without significantly impacting resident retention, which was 58% in the quarter. To date, renewal spreads on like-term leases are ahead of expectations, increasing from 3.2% in the first quarter to 4.1% in the second quarter and further accelerating by 50 basis points in July to 4.6%. August renewals, which are 95% complete today, are a positive 4.5%. All in all, our blended rent growth across like-term leases improved from 70 basis points in the first quarter to 1.3% in the second quarter, resulting in blends for the first half of the year of 1.1%. In July, blended rents on like-term leases were positive 2.5%. On the expense side, same-store operating expenses increased 50 basis points in the quarter, reflecting higher payroll and contract services, partially offset by decreases in property taxes and insurance. On our property Wi-Fi initiative, I'm pleased to report the program is running slightly ahead of plan due to earlier implementation at 19 communities that went live in May and June. Wi-Fi contributed roughly $400,000 of incremental revenue in the second quarter, which was ahead of guidance and is ramping quickly to achieve our original second half guidance of $5.5 million in revenues and $3 million of NOI. Turning to capital allocation. Our value-add renovation program remains our most attractive investment opportunity. Through the first half of the year, we have completed 1,026 units, putting us on track to meet our original guidance of 2,000 to 2,500 units. We achieved 16% ROIs on renovations in the first half of the year, and as Scott highlighted, expect to capture higher rent premiums going forward as market rents continue to recover. On the capital recycling front, we are under contract for the sale of Stonebridge Crossing in Memphis, which should close before the end of this quarter. We intend to use the proceeds to delever and forecast ending the year with a net debt-to-EBITDA ratio in the mid-5s. Additionally, I'm pleased to highlight that in June, Fitch Ratings increased our outlook to positive from stable and that both Fitch and S&P affirmed our BBB flat rating. Now turning to guidance. We are increasing the midpoint of our same-store NOI guidance for the full year by 70 basis points to 1.5%. This increase equates to an additional $2.5 million of NOI as compared to our original guidance and is based on our outlook for same-store revenue growth, which we affirm at 1.7% for the full year and our expectation for lower operating expenses during the second half of the year. For core FFO per share, the expected increase in same-store NOI is offset by $2 million of higher interest expense and a $2 million decrease in expected non-same-store NOI. In addition, core FFO per share is benefiting from a lower weighted average share count due to our first quarter share repurchases. As a result, after all these moving pieces, we are maintaining the midpoint of our core FFO per share guidance of $1.14. Details on our updated same-store guidance are as follows: same-store revenue growth of 1.7% at the midpoint is unchanged. That implies second half growth of roughly 2.1%, an acceleration from the 1.1% we delivered in the first half. We want to be clear about the components of this growth. Of the roughly $10 million of same-store revenue growth in our guidance for the year, $8.7 million is already in the books from revenue earned in the first half and the $5.5 million from our Wi-Fi program in the second half. That leaves about $1.3 million of revenue that will come from leases signed in the second half of 2026. As we sit here today, we've already signed about 50% of our leases for the second half of the year at blended spreads of 2.8%. To achieve the $1.3 million of incremental revenue growth, we need to sign the remaining 50% of our leases at blended spreads of 1.6% or better. Ultimately, all in all, as we sit here today, 87% of our full year revenue growth is already achieved or contracted. Our revised midpoint for operating expense growth of 2% is 140 basis points lower than our original 3.4% midpoint, primarily driven by better results in both controllable and noncontrollable operating expenses. For our non-same-store portfolio, the reduction in forecasted NOI relates primarily to the slower lease-up at The Tisdale at Lakeline Station, the development asset we consolidated during the first quarter of this year. The project's average occupancy of 36% in the second quarter was behind our original expectations. We made good leasing progress in July with the community now 42% occupied. We expect this community to reach stabilized occupancy during the first quarter of 2027. Lastly, we are increasing the midpoint of our full year interest expense guidance by $2 million, reflecting higher SOFR rates, including an assumed 25 basis point increase in September and temporarily higher average debt levels associated with the timing of investment activity. As I mentioned previously, with the pending sale of Stonebridge and the associated deleveraging, we expect to end the year with net debt to EBITDA in the mid-5s. Scott, that was a lot. Back to you. Scott Schaeffer: Thanks, Jim. To summarize, same-store results through the first half of the year are ahead of plan, driving the increase in our same-store guidance for the full year. Demand remains strong as demonstrated by our year-over-year increases in leasing volume and the trajectory of new lease trade-outs. Our value-add program will benefit from increasing rental rates and the ongoing recovery and the shorter completion time line will enable us to increase future value-add activity with no impact on occupancy. Our Wi-Fi initiative is ahead of plan and contributing meaningfully to the revenue growth assumed in our guidance. As we move through the back half of 2026, we expect continued improvement in apartment market fundamentals to drive stronger leasing and earnings momentum into 2027. We thank you for joining us today. Operator, you can now open the call for questions. Operator: [Operator Instructions] Your first question is from the line of Eric Wolfe with Citibank. Eric Wolfe: You mentioned that new leads were up year-over-year and concessions across your markets were down. If possible, could you just quantify those 2 data points, so the leads and the concessions? I'm just trying to understand sort of how big of a shift this was and get some context around sort of how quickly market conditions are improving. James Sebra: Sure. So lead volume is up about 5% year-over-year. And then concession usage, I'll kind of talk about it in 2 pieces. One would be just the volume of new leases that have a concession and the second one will be the average concession. If you look at kind of the pace of concessions where we are right now in, say, the month of -- for July versus earlier this year, April and March of this year, 52% of our new leases had a concession. And as you said, in July, 23% of our new leases had a concession. And that compares against last year concessions for new leases roughly around the same 23% mark. So year-over-year, concessions are kind of back to where they needed to get to. But where we are in July, it's a significant improvement from where we were earlier this year. That's all on top of, obviously, a 3% to 3.5% asking rent growth that we've experienced since this time last year. And then the average concession is hovering in Q2 of this year for purposes of new leases in the $1,300 range right now. Eric Wolfe: Got it. That's helpful. And then you talked about new leases being positive thus far in August. Can you just talk about where occupancy is today? And you mentioned sort of addressing most of your sort of second half leases already. I guess based on sort of what you've signed thus far, would you expect occupancy to sort of stay stable from current levels? James Sebra: Yes. Occupancy today is 95%. And yes, we would expect it to stay stable. It might actually grow a little bit as we end the year. Operator: Your next question is from the line of Austin Wurschmidt with KeyBanc Capital Markets. Austin Wurschmidt: Just going back a little bit to the concession question. I'm just curious which markets are you still seeing the heaviest concession usage and kind of where, I guess, the next opportunity or leg up is from driving down concessions? Can you just give a little detail across markets? James Sebra: Sure. Great question, Austin. I'll start, and then I'll ask Janice and Jason to kind of chime in wherever I miss something or misspeak. But obviously, the biggest positive move in concessions so far this year is really in Atlanta. Back in March and April, 60% to 70% of our new leases had concessions. And in July, that was down to about 17%. So really a real positive move in Atlanta. Dallas today continues to be relatively high on the concession usage. Back in March and April, that was roughly about 45% to 50%. And today, we're running around 40%, 42%. And then Tampa is also seeing a little bit heavier concession usage, although it is down slightly in July. Earlier this year, it was in the, call it, the 55% to 60% range. And right now, we're hovering around 40%. But Janice, Jason, feel free to chime in. Austin Wurschmidt: Okay. Just going back a little bit to kind of the back half, bad debts kind of held a little bit above that 1% range after seeing some meaningful improvement in the back half of last year. Just wondering what are you seeing into the third quarter? And what's kind of the expectation now for further improvement into the back half of the year? James Sebra: Yes. Back half of the year, our guidance implies, I think it's 95 basis points of bad debt, and that's kind of where we're running right now for July and August. Operator: Your next question is from the line of Jamie Feldman with Wells Fargo. Conor Peaks: This is Conor on with Jamie. Over the past several quarters, your team has highlighted the advantages of your Class B portfolio and its relative affordability. As concessions begin to moderate and supply is absorbed, are you seeing any meaningful divergence between Class B and newer Class A product in terms of retention, move-outs, pricing power or other variables? James Sebra: No, I don't think we were really seeing any significant change today between the Class B -- in terms of the core operating fundamentals between Bs and As. Conor Peaks: Okay. And then you've previously discussed the acceleration in same-store revenue in the back half of the year from Wi-Fi. Can you walk us through the second half contribution? And as we move into 2027, should investors think about the initiative as largely ramped? Or is there additional upside from this rollout over time? James Sebra: Thank you. Good question. We started the Wi-Fi program, and we rolled it out effective early July. Obviously, a few communities were done in May and June, but it's going to contribute about $5 million to $5.5 million of revenue in this year, roughly about $3 million of NOI. That is kind of starting at an initial kind of ramp where there's about 70% penetration in July of all of our resident base. And then as leases turn, that penetration will grow. We expect to be 80%, 85% penetrated by the end of the year, and that will continue to improve in the next year as well as you'll get an extra 6 months of revenue and an extra 6 months of NOI. We are currently evaluating additional properties for the program to be added to it next year because, again, this initial WiFi program was only 19,000 units. So once we come out with 2027 guidance, we'll give you some more color on how significant that will be. Operator: Your next question is from the line of Brad Heffern with RBC Capital Markets. Brad Heffern: Obviously, positive new lease spreads has been an area of investor focus. I appreciate the comments about being slightly positive in August on like-term. I'm wondering, do you expect to see kind of a normal level of seasonal decline after that? Basically wondering just if we can expect new lease to be around 0 or better in the third quarter or if we're going to see the normal September fall off and we'll have to wait until next year to see that on a quarterly basis? James Sebra: Good question. July, as we commented, new leases were down 1.1%, and that's about 40% of the third quarter expirations. In terms of the month of July. So I don't know if third quarter will be, call it, 0. But in terms of guidance, what we've assumed is that we kind of maintain roughly a minus 50 basis points in new lease trade-outs through the end of the year. And that pretty much assumes that asking rents stay flat. I will provide a little bit of additional color that it is coming upon good comps where we had large concessions in third and fourth quarter of last year that are not expected to be present this year, and that should both support new lease trade-outs as well as renewal trade-outs. Brad Heffern: Okay. Got it. And then on concessions, you said earlier that they were flat year-over-year in July. I just want to make sure I understand that commentary right. Is the full new lease improvement just coming from rate growth? Or is there something else there that I'm missing that's contributing as well? James Sebra: Yes. I would say, if you look at year-over-year, it's coming from rate growth. If you look at it from earlier this year to now, it's coming from concessions stopping. Operator: Your next question is from the line of John Kim with BMO Capital Markets. John Kim: I just wanted to follow up on your commentary on new lease trade-outs. Just given the success you've had so far through August and lower concessions, do you think it could be an improvement from the minus 2.1% you had in the second quarter, again, just given the easier comps and commentary you've had? James Sebra: In terms of the rest of the year? John Kim: Yes, for the third and fourth quarter. James Sebra: Yes. We certainly think that third and fourth quarter should be better than what we -- the minus 2.7% in the second quarter for sure. John Kim: Okay. And then can you provide pricing commentary on the 2 assets held for sale? Jason Lynch: No. We're on the assets were held for sale in Memphis, we're still working through that closing process. So that's not something we typically disclose on this time. John Kim: Would it be within the typical range of cap rates that you sold in the past? Jason Lynch: Yes, that's fair. Operator: Your next question is from the line of Ami Probandt with [ UBS Investment Bank ]. Ami Probandt: I was hoping to get a little bit more context on how the peak leasing season played out. Is it fair to characterize this as a normal peak leasing season in terms of length and magnitude? And with the leasing season extending a little bit into July, is that due to stronger demand than normal? Or are easy comparisons more of a factor? Janice Richards: Yes. This is Janice. We are definitely seeing a robust strong absorption rate throughout the markets that have supported the recovery that we're seeing on our new lease rates as well as asking rates. I think whether it's a comp set or it is concessions that's going to elongate, we shall see. We are coming up against an easier comp set that will allow for us to have more pricing power. And I think as we move into the leasing season, we'll see normal seasonal patterns kick in through the rest of the year. Ami Probandt: Great. And then you mentioned that -- sorry, go ahead. James Sebra: Ami, just a little bit of a follow-up. The lead data in terms of like the size and trajectory of leasing season is certainly suggesting it's back to a normal kind of cycle. As I mentioned earlier, our leads are up 5% for the year. But to highlight, July was actually up quite significantly or closer to 20%, 25%. So we do see really good demand building, but we're still being cautious, and we're still driving the focus on rate as opposed to occupancy so we can continue to deliver our results and focus on the long term. Ami Probandt: That's helpful. And then in terms of bad debt, you mentioned 95 basis points in the second half of the year, which I believe is still well above where you were pre-COVID. So what do you think is leading to bad debt lingering at the higher level? And do you think that this is just kind of the new normal level of bad debt? Or could there be continuing tailwinds in 2027? James Sebra: Well, we think that it's -- certainly, there's a new level of normal relative to post-COVID. We think certainly not that fraud is a huge issue anymore, but the ability to have fraudulent IDs is still a lot easier today than it was in 2020. So I think that's something that we're continuing to use technology to try to sort out and figure out. But I think we certainly expect to continue to make some forward progress in 2027. Do we -- is the aspiration to get back to pre-COVID levels? Sure, absolutely, and we think we can get there. But it's just going to take additional kind of technology rollout and usage throughout the portfolio. Operator: Your next question is from the line of Wes Golladay with [ W. Baird ]. Wesley Golladay: I want to go back to the comment about the increased leads. Are those -- I guess, can you talk about your conversion rate? Are you signing more of those leases -- those leads into leases? James Sebra: Yes. I mean I would say our conversion rate is still roughly consistent with where we've seen in the past. I mean it's -- we really focus on, obviously, the whole conversion from -- it's not just conversion from lead to tour, but the closing ratio of tours applications, applications to leases. And I would say just largely, it's resulting in more volume of leases, yes. Wesley Golladay: Okay. And then you mentioned that Tisdale was a little bit behind on occupancy. Can you also comment on the rate expectations there? James Sebra: Yes. The rate expectations are also behind some of the initial underwriting we made when we entered. If you remember, that was a joint venture development deal that we entered several years ago. The rate environment has been different or more difficult than what we originally anticipated. But the deal is ramping nicely. It is obviously experiencing a little higher use of concessions today. And we do expect to stabilized occupancy, if you will, in Q1 '27. Operator: Your next question is from the line of John Pawlowski with Green Street. John Pawlowski: A few questions on expenses, but I want to make sure I heard that statistic properly. So lead volume was up 5% in 2Q, and it was up 25% in July. And if I heard that right, is that really a function of organic demand? Or were there other idiosyncratic factors with marketing campaigns or something unusual that happened in July from a year ago? James Sebra: Yes. It's certainly no additional marketing spend, just getting better at our various organic, what I would say, search engine optimization, making sure we're ranking high with both Google algorithm as well as the AI tools that exist today. And then I think from the standpoint of the fundamental driver of it is clearly from the organic algorithm and the search demand. John Pawlowski: And then on expenses, so it's been maybe 2.5 years where repair and maintenance costs have declined on an absolute basis. I know turnover is down meaningfully versus 2 or 3 years ago. But curious if we should expect any kind of outsized well above inflationary costs on R&M in the next couple of years, if there's a kind of catch-up to be had on the very, very low R&M costs for the past couple of years. James Sebra: Yes. No, I don't think so. I think the teams are doing a great job of taking care of our properties and really focus on turning units and being smart about the use of vendors versus internal individuals on site doing various things. So I think no, there's no expectation for any kind of outsized increase in repairs and maintenance costs down the road. Operator: Your next question is from the line of Peter Abramowitz with Deutsche Bank. Peter Abramowitz: Just wondering if you could give an update on a potential sale of the Mustang in Dallas. I know it's something you've talked about marketing for sale in the past. Just curious how the process has gone there and I guess, pricing and kind of depth of demand relative to your expectations? Scott Schaeffer: Good question. We have not made a decision yet on whether to sell the asset or not. We did market it to a limited extent, but it's a great asset in a great location with, we think, tremendous opportunity long term. So we're still analyzing what the best approach is, whether or not we keep it and/or we end up selling it. The project is doing fine. It's basically stabilized. Occupancy is north of 93%. Concessions are declining. So as we look forward, we think it might be a good addition to our portfolio. But we're not ready to make that decision or give that answer yet. Peter Abramowitz: All right. I appreciate that, Scott. And then it looks like you paused the buybacks in the second quarter after doing, I guess, a modest amount in the first quarter. Just looking at it, the stock was still trading at a pretty significant discount to NAV and for much of the quarter actually trading below the price at which you bought back stock at or below the price at which you bought back stock in the first quarter. So I just wanted to ask about kind of the thought process and decision-making there around pausing the buyback and just kind of general thoughts on how you're thinking about use of excess capital today? James Sebra: Yes. Good question. I think the decisions around the buyback is really just there wasn't any excess capital to use to buy back stock in the second quarter. If not, we would have certainly been a buyer of it. As Jason mentioned, the Stonebridge deal that's selling -- that is selling here in September. And certainly, if there's excess capital that comes from that, we will certainly be looking to buy back stock. I mean our primary -- our best use of capital today continues to be the renovation program. After that, it's still -- given the stock price as of yesterday, we'll still be buying back stock. But again, it's all based on the availability of excess capital. Scott Schaeffer: And frankly, where that capital comes from the majority of the buybacks that we made were -- the capital came from the sale of joint venture assets that were not contributing to EBITDA. We have resisted selling assets, giving up the EBITDA and in order to just buy back stock because, one, it becomes negative relative to leverage. But also, we like our portfolio and we like the long-term prospects of the portfolio. Operator: Your next question is from the line of Jason Wayne with Barclays. Jason Wayne: Just on expenses, real estate taxes came in better than expected over the past couple of years as well. Just wondering where you captured the tax savings this year and which markets you saw that in? James Sebra: Sure. The biggest win so far this year has been in Texas markets. Texas appeals each -- or Texas [Audio Gap] every year, and we go through an appeal process. I would say the savings in terms of the appeal process can be a bit lumpy from period to period depending on the timing and obviously, the success of the appeal. So you have some of that kind of working through this quarter where we had appeals from last year that came in this year and they came in better than we anticipated. But even that, when you look at our guidance for the year, we lowered real estate tax growth overall because we're expecting better assessments or lower assessments and probably the same, maybe slightly lower millage rates where our overall tax expense will be better than last year, better than we originally anticipated. Jason Wayne: Got it. And then you said you mentioned you see a path to achieve higher rent premiums on your value add. So is that something you're looking to grow? And kind of how should we think about that contribution in 2027? James Sebra: Yes. I mean I think the rent premiums will continue to improve as rental rates improve. And as I said before, it continues to be our primary use of capital. It is a fantastic program that has really provided a tremendous amount of NOI growth for IRT over the years. So as we kind of look forward to stabilizing and improving market fundamentals, it is certainly a program that we will continue to look at to accelerate when it makes sense and where it makes sense. Scott Schaeffer: And let me add, clearly, the renovated units compete most directly with the new construction. So with all the new construction that came online over the last few years that were offering concessions, that actually put downward pressure on the premiums that we could then get on the renovated units. So as we go forward, with less competition from that new construction, we really see the premiums and the returns expanding on the value-add program. And then you add in there that we've significantly reduced the amount of time that it takes to renovate a unit, so we can do many more renovations without impacting occupancy and thereby generating much better growth. Operator: Your next question is from the line of Austin Wurschmidt with KeyBanc Capital Markets. Austin Wurschmidt: Scott, just sticking with the comments you had there on value-add redevelopment and kind of the ability to execute without impacting occupancy. I mean, how much from a unit volume perspective and spend can you really handle without increasing leverage as well as impacting occupancy? Can you just kind of frame up the sizing of that program, how big it could get in a given year? Scott Schaeffer: Sure. So last year, I think we did 1,700 units, give or take. This year, we're going to be closer to that 2,500 units. Jim is telling me 2,000 to 2,500. I'm going to tell you closer to the 2,500. When we started this program, it was taking anywhere from 30 to 35 days to turn a unit. Now we're down below 20 days. So we've made a significant improvement in the process and in the amount of time it takes. So we feel that we can really continue now to ramp it. I have always been resistant of doing too many because of the pressure that it was putting on occupancy. And I hated that headline risk of having a lower portfolio occupancy because of the value add. This will allow us to really ramp the program and presumably get to 3,000 to 4,000 units per year. James Sebra: If you also remember, when we -- after the Steadfast deal, we took on those 2 on-balance sheet developments and really used a lot of free cash flow to fund those developments. Now that they're behind us, obviously, we took capital earlier this year and bought back stock, and that capital will be available next year to, as Scott mentioned, put into the value-add program. Austin Wurschmidt: That's really helpful. And then maybe just last one, just strategically, given the relative size of the portfolio and just ability for you to remain more nimble, what are the biggest other opportunities in front of you now that you are seeing fundamentals start to show some green shoots and improve into the back half of this year? Scott Schaeffer: Well, it's all about the cost of capital. We would hope that with the market recovery that we have a cost of capital that will allow us to go back and acquire again. We have always resisted growth for the sake of growth. So we've been patient. Value-add continues to be clearly the best use of capital. We're generating, again, as Jim mentioned, I think, in his remarks, mid-teens unlevered returns. But again, there's only so much of that we can do. So at 4,000 units a year, you're talking about $80 million. I would like to see, again, the cost of capital at a point where we can -- or a level where we can then start growing again. There's opportunities out there. And we've proven that our strategy works. Operator: We have reached the end of the Q&A session. I will now turn the call back to Scott Schaeffer for closing remarks. Please go ahead. Scott Schaeffer: Well, thank you all for joining us this morning. We appreciate your continued interest in IRT and look forward to speaking with you -- many of you in the weeks ahead. So thank you. Operator: This concludes today's call. Thank you for attending. You may now disconnect your lines. Before you buy stock in Independence Realty Trust, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Independence Realty Trust wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $399,832!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,374,595!* That performance is why people listen. With a track record of beating the S&P 500 by 4x, Stock Advisor offers a distinct advantage. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built for the long haul. See the 10 stocks » *Stock Advisor returns as of August 10, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. IRT (IRT) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Independence Realty Trust, Inc.? Here are five stocks we like better. IRT raised its full-year same-store NOI growth midpoint to 1.5%, up 70 basis points, after second-quarter same-store NOI rose 1.2% and core FFO reached $0.28 per share. The company maintained its $1.14 per-share core FFO guidance because higher NOI is expected to be offset by increased interest expense and lower non-same-store NOI. Leasing trends improved significantly, with new-lease spreads narrowing from negative 3.9% in the first quarter to negative 1.1% in July, while renewal spreads reached 4.6%. Concessions also declined sharply, and management expects occupancy to remain stable or improve modestly by year-end. The new community Wi-Fi program generated $400,000 of second-quarter revenue and is expected to produce $5 million to $5.5 million of revenue and about $3 million of NOI in the second half of 2026. IRT also plans to use proceeds from a planned property sale to reduce leverage, targeting year-end net debt to EBITDA in the mid-5x range. The 3 Most Promising Real Estate Stocks to Watch this Quarter Independence Realty Trust (NYSE:IRT) said improving apartment market conditions, reduced concessions and a new community Wi-Fi program supported stronger operating results in the second quarter of 2026, prompting the company to raise the midpoint of its full-year same-store net operating income guidance. Core funds from operations, or FFO, totaled $0.28 per share for the quarter, ahead of the company’s internal expectations, President and Chief Financial Officer Jim Sebra said. Same-store NOI increased 1.2%, supported by 0.9% same-store revenue growth and a 0.5% increase in same-store operating expenses. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control The company increased the midpoint of its full-year same-store NOI growth outlook by 70 basis points to 1.5%, representing an additional $2.5 million of NOI relative to its original guidance. It maintained its midpoint core FFO guidance at $1.14 per share, as higher same-store NOI is expected to be offset by higher interest expense and lower anticipated non-same-store NOI. Chairman and Chief Executive Officer Scott Schaeffer said operating momentum was building as supply deliveries declined in IRT’s markets and demand remained supported by employment growth, particularly in education and healthcare. He also cited the high cost of homeownership and the company’s focus on larger apartments in school districts near employment and retail centers. → 3 Drone Stocks That Should Soar After the Summer Slump Like-term new lease trade-outs improved from negative 3.9% in the first quarter to negative 2.7% in the second quarter, then to negative 1.1% in July. With 65% of expected August new leases completed, new lease spreads were slightly positive, according to management. Renewal spreads increased from 3.2% in the first quarter to 4.1% in the second quarter and 4.6% in July. Blended rent growth across like-term leases rose from 0.7% in the first quarter to 1.3% in the second quarter, while July blended rent growth reached 2.5%. → Why Rare Earth Processing Could Be the Real 2027 Opportunity Average occupancy was 95% in the second quarter, down 20 basis points sequentially. Sebra said the company deliberately prioritized rental rates over occupancy to maximize revenue, and Schaeffer said occupancy was expected to remain stable or potentially rise modestly by year-end. IRT reported that lead volume was about 5% higher year over year, with July leads up approximately 20% to 25%, according to Sebra. He attributed the gains to organic search demand and improvements in search-engine optimization rather than increased marketing spending. Concession use fell significantly during the year. Schaeffer said 52% of new leases included concessions in March and April, compared with 23% in July, roughly in line with the year-earlier level. Asking rents increased about 3% to 3.5% from the prior year, he said, while the average concession on new leases was approximately $1,300 during the second quarter. Atlanta saw one of the sharpest improvements, with the share of new leases receiving concessions falling from roughly 60% to 70% in March and April to about 17% in July. Dallas and Tampa continued to have comparatively higher concession usage, with both markets around 40% in July. IRT’s community Wi-Fi initiative contributed about $400,000 of incremental revenue during the second quarter, ahead of guidance, after 19 communities went live in May and June. The company expects the program to generate $5 million to $5.5 million of revenue and approximately $3 million of NOI in the second half of 2026. The rollout began broadly in early July and had roughly 70% penetration among residents that month. Sebra said penetration is expected to reach 80% to 85% by the end of the year as leases turn over. The initial program covers about 19,000 units, and IRT is evaluating additional properties for potential inclusion in 2027. Schaeffer said the initiative should contribute at least $0.01 per share of core FFO in 2027. For the full year, IRT reaffirmed its same-store revenue growth midpoint of 1.7%, implying approximately 2.1% growth in the second half after 1.1% growth in the first half. Sebra said roughly 87% of expected full-year revenue growth was already achieved or contracted, including first-half revenue and anticipated Wi-Fi revenue. IRT completed 1,026 apartment renovations during the first half and remains on track to complete 2,000 to 2,500 units for the full year. The renovation program generated a 16% return on investment during the first half, according to Sebra. Schaeffer said the company has shortened renovation turnaround times from roughly 30 to 35 days when the program began to less than 20 days currently. That improvement should allow IRT to expand renovation activity without reducing portfolio occupancy. He said the company could potentially increase annual renovation volume to 3,000 to 4,000 units. Management expects improved market rents and less competition from newly constructed properties offering concessions to support higher rent premiums and returns on renovated units. Schaeffer said renovated properties compete with newer Class A communities while offering a lower price point. IRT is under contract to sell Stonebridge Crossings in Memphis, with a closing expected before the end of the third quarter. The company intends to use sale proceeds to reduce leverage and expects to finish the year with net debt to EBITDA in the mid-5x range. Fitch Ratings raised IRT’s outlook to positive from stable in June, while Fitch and S&P affirmed the company’s BBB flat rating. The company also said it has not yet decided whether to sell The Mustang in Dallas. Schaeffer said the property is stabilized, has occupancy above 93%, and is experiencing declining concessions. IRT lowered the midpoint of its full-year operating expense growth outlook to 2% from 3.4%, citing better-than-expected results in controllable and non-controllable costs. Property-tax results were aided by successful appeals in Texas and expectations for lower assessments and potentially lower millage rates. Bad debt declined to 1.1% of total revenue in the second quarter from 1.3% a year earlier. Management’s second-half outlook assumes bad debt of roughly 95 basis points. Sebra said fraud risk has declined from prior periods but that the availability of fraudulent identification remains easier than before 2020, making technology investments important to further improvement. Non-same-store NOI expectations were reduced mainly because of slower-than-expected lease-up at Tisdale at Lakeline Station, a development asset consolidated during the first quarter. The property was 36% occupied in the second quarter and improved to 42% in July. IRT expects the community to reach stabilized occupancy in the first quarter of 2027, while rental rates also remain below the company’s original underwriting assumptions. Independence Realty Trust is a self-administered equity real estate investment trust that acquires, redevelops and manages multi-family communities. The company focuses on workforce housing, targeting Class A and B garden-style apartments in suburban and urban infill locations. Its core activities include sourcing value-add acquisitions, overseeing property renovations and delivering in-house property management services to optimize rental income and occupancy levels. Headquartered in Wayne, Pennsylvania, Independence Realty Trust maintains a geographically diverse portfolio across several high-growth U.S. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Independence Realty Trust Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management attributes building operating momentum to a recovery in market fundamentals, evidenced by a 120 basis point sequential improvement in new lease rates during Q2. Performance is supported by a resilient resident profile, with employment growth in education and healthcare sectors across the company's top 10 markets outpacing national averages. The value-add renovation strategy is being optimized by reducing unit turnaround time from over 30 days to under 20 days, allowing for increased volume without impacting occupancy levels. Strategic positioning focuses on the 'value proposition' of larger units and lower price points compared to new construction, which has successfully captured demand as homeownership costs remain high. The successful early implementation of a community WiFi initiative has established a new recurring revenue stream that is expected to contribute at least $0.01 to next year's core FFO. Management noted that market occupancies have reached levels that support broader rent growth, allowing for a deliberate reduction in concession usage from 54% in April to 28% in July. Full-year same-store revenue guidance of 1.7% assumes an acceleration to 2.1% growth in the second half, with 87% of that growth already achieved or contracted. Management expects to ramp value-add renovations to a pace of 3,000 to 4,000 units per year as market rents recover and competition from new construction deliveries subsides. Guidance for the remainder of 2026 assumes new lease trade-outs maintain a level of approximately negative 50 basis points, predicated on flat asking rents and easier year-over-year comparisons. The company expects to reach a net debt-to-EBITDA ratio in the mid-5s by year-end, supported by the pending sale of a Memphis asset and subsequent deleveraging. Future capital allocation will prioritize the renovation program and opportunistic share buybacks, contingent on the availability of excess capital from asset sales. The Tisdale at Lakeline Station development is experiencing slower-than-expected lease-up and lower rental rates than originally underwritten, with stabilization now projected for Q1 2027. Interest expense guidance was increased by $2 million to reflect higher SOFR rates and an assumed 25 basis point rate hike in September. Bad debt remains elevated relative to pre-pandemic levels at approximately 1.1% of revenue, which management attributes to the increased ease of identity fraud despite improved screening technology. Fitch Ratings updated the company's outlook to positive from stable, affirming the BBB flat rating alongside S&P. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Lead volume increased 5% year-over-year for the quarter but surged approximately 20% to 25% in July due to improved organic search optimization. Concession usage in Atlanta saw a dramatic shift, dropping from 60-70% of new leases in early spring to just 17% in July. Management believes they can now handle 3,000 to 4,000 renovations annually because the time to complete a unit has dropped below 20 days. This increased efficiency mitigates the 'headline risk' of lower portfolio occupancy that previously constrained the program's volume. The pause was due to a lack of excess capital rather than a change in valuation perspective; management remains interested in buybacks if capital becomes available from non-EBITDA producing assets. Management emphasized they will not sell core assets to fund buybacks if it negatively impacts leverage or long-term portfolio prospects. The reduction in expense guidance was primarily driven by successful tax appeals in Texas and lower-than-anticipated assessments. Management does not expect a 'catch-up' spike in repairs and maintenance costs, asserting that current low spending reflects efficient internal processes rather than deferred maintenance.

This article first appeared on GuruFocus. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Independence Realty Trust Inc (NYSE:IRT) reported a 120 basis point sequential improvement in new lease rates during Q2 2026, with further improvement in July and slightly positive new lease spreads for August, signaling a market recovery. The company's Community Wi-FY initiative is ahead of schedule, contributing $400,000 in Q2 revenue and expected to add at least one incremental penny of core FFO per share to 2027 results. Same-store NOI growth of 1.2% in Q2 outpaced the original guidance midpoint, driven by stronger revenue growth and lower expense growth, leading to a 70 basis point increase in full-year same-store NOI guidance. Value-add renovation program achieved 16% ROIs in the first half of 2026, with reduced renovation times (below 20 days) enabling a potential ramp-up to 3,000-4,000 units annually without impacting occupancy. Fitch Ratings upgraded the company's outlook to positive from stable, and both Fitch and S&P affirmed the BBB flat rating, reflecting improved creditworthiness. Leasing momentum is strong, with lead volumes up 5% year-over-year and July leads up 20-25%, while concession usage declined from 54% of new leases in April to approximately 28% in July. Renewal spreads on like-term leases accelerated to 4.6% in July from 3.2% in Q1, with August renewals at 4.5%, indicating strong pricing power. Independence Realty Trust Inc (NYSE:IRT) faces higher interest expenses, with full-year guidance increased by $2 million due to higher SOFR rates, including an assumed 25 basis point increase in September. The Tisdale at Lakeline Station development asset is behind occupancy expectations, with average occupancy of 36% in Q2, though it improved to 42% in July and is expected to stabilize in Q1 2027. New lease spreads remain negative in some regions, with Sun Belt communities at negative 3.8% in Q2 and West communities at negative 3.2%, though both improved in July. Bad debt remains elevated at 1.1% of total revenue in Q2, with second-half guidance implying 95 basis points, still above pre-COVID levels due to ongoing fraudulent ID issues. The company paused share buybacks in Q2 due to a lack of excess capital, despite the stock trading at a significant discount to NAV, limiting capital return opportunities. Non-same-store NOI is expected to decrease by $2 million for the full year, primarily due to slower lease-up at the development asset, offsetting some gains from same-store performance. Average occupancy declined 20 basis points sequentially to 95%, reflecting a deliberate strategy to prioritize rental rates over occupancy, which could pressure near-term revenue. Warning! GuruFocus has detected 6 Warning Signs with IRT. Is IRT fairly valued? Test your thesis with our free DCF calculator. Q: Can you quantify the year-over-year increase in new leads and the decrease in concession use to help us understand how quickly market conditions are improving?A: Jim Seabrook (CFO): Lead volume is up about 5% year-over-year. Concession usage has improved significantly from earlier this year. In March and April, 52% of new leases had a concession, but in July, that dropped to 23%, which is back to last year's levels. This is on top of 3% to 3.5% asking rent growth since this time last year. The average concession for new leases is currently hovering around $1,300. Q: Given the positive new lease spreads in August, should we expect a normal seasonal decline in the third quarter, or can we expect new lease trade-outs to remain around zero or better?A: Jim Seabrook (CFO): July new leases were down 1.1%, representing about 40% of third-quarter expirations. For guidance, we assume new lease trade-outs will maintain roughly a minus 50 basis points through the end of the year, assuming asking rents stay flat. However, we are coming up on easier comps from the large concessions offered in the third and fourth quarters of last year, which should support both new lease and renewal trade-outs. Q: Can you walk us through the second-half contribution of the Wi-FY initiative and how investors should think about this revenue stream heading into 2027?A: Jim Seabrook (CFO): The Wi-FY program will contribute about $5 to $5.5 million in revenue and roughly $3 million in NOI this year. We started with about 70% penetration in July and expect to reach 80% to 85% by year-end. The program will continue to improve next year with an extra six months of revenue and NOI. We are currently evaluating additional properties to add to the program next year, as the initial rollout only covered 19,000 units. We will provide more color when we issue 2027 guidance. Q: Which markets are still seeing the heaviest concession usage, and where is the next opportunity to drive down concessions?A: Jim Seabrook (CFO): The biggest positive move in concessions has been in Atlanta, where usage dropped from 60%-70% of new leases in March and April to about 17% in July. Dallas continues to have relatively high concession usage, running around 40%-42% today, down from 45%-50% earlier this year. Tampa is also seeing heavier usage at around 40%, down from 55%-60% earlier in the year. Q: Can you provide context on how the peak leasing season played out, and is the strength in July due to stronger demand or easier comparisons?A: Janice Richards (EVP of Revenue Strategy): We are seeing robust absorption rates across our markets, which supports the recovery in new lease rates and asking rents. Whether it's the comp set or concessions that will elongate the season remains to be seen, but we are coming up against easier comps that will allow for more pricing power. Jim Seabrook (CFO): Lead data suggests we are back to a normal cycle. Leads are up 5% for the year, but July was up significantly, closer to 20%-25%. We see good demand building, but we remain cautious and focused on rates over occupancy. Q: What is the current occupancy level, and do you expect it to remain stable given the leases already signed for the second half?A: Jim Seabrook (CFO): Occupancy today is 95%. We expect it to remain stable and it might actually grow a little bit as we end the year. Q: Can you discuss the decision to pause share buybacks in the second quarter, and how are you thinking about the use of excess capital today?A: Jim Seabrook (CFO): There simply wasn't any excess capital to use for buybacks in the second quarter. With the pending sale of Stonebridge Crossing in Memphis, if there is excess capital, we will certainly look to buy back stock. Our best use of capital remains the renovation program, followed by buybacks given the current stock price. Scott Schaefer (CEO): The majority of our buybacks were funded by the sale of joint venture assets that weren't contributing to EBITDA. We have resisted selling assets that contribute EBITDA just to buy back stock, as it would be negative relative to leverage, and we like the long-term prospects of our portfolio. Q: How much can you scale the value-add renovation program from a unit volume and spend perspective without increasing leverage or impacting occupancy?A: Scott Schaefer (CEO): Last year we completed about 1,700 units, and this year we are on track for 2,000 to 2,500 units. We have significantly reduced the time to turn a unit from 30-35 days to below 20 days. This improvement allows us to ramp the program to 3,000 to 4,000 units per year without impacting occupancy. At 4,000 units a year, that's roughly $80 million in capital deployment. Q: What are the biggest strategic opportunities for the company now that market fundamentals are showing signs of improvement?A: Scott Schaefer (CEO): It's all about the cost of capital. We hope that with the market recovery, our cost of capital will allow us to resume acquisitions. We have resisted growth for the sake of growth and have been patient. Value-add remains the best use of capital, generating mid-teens unlevered returns. We would like to see our cost of capital reach a point where we can start growing the portfolio again, as there are opportunities available and our strategy has proven successful. Q: Can you provide an update on the potential sale of the Mustang asset in Dallas and the depth of demand?A: Scott Schaefer (CEO): We have not made a decision yet on whether to sell the asset. We marketed it to a limited extent, but it's a great asset in a great location with tremendous long-term opportunity. The project is performing fine, with occupancy north of 93% and concessions declining. We are still analyzing whether to keep it or sell it, and we are not ready to make that decision yet. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

PHILADELPHIA, August 03, 2026--(BUSINESS WIRE)--Independence Realty Trust, Inc. ("IRT") (NYSE: IRT), a multifamily apartment REIT, announces its second quarter 2026 financial results. Second Quarter 2026 EPS of $0.01 Second Quarter 2026 CFFO Per Share of $0.28Ahead of Expectations Same-Store Portfolio NOI Growth of 1.2% for the Second Quarter 2026Increases of 0.9% in Rental Revenues and 0.5% in Property Operating ExpensesLeasing Spreads Accelerated in Improved Operating Environment Completed 600 Renovations in Value Add Program for the Second Quarter 2026Achieved Average ROI of 16.4% Investment Grade Balance Sheet Remains StrongFitch Ratings Upgraded Outlook to ‘Positive’ Affirmed MidPoint of Full Year 2026 Core FFO Per Share Guidance Management Commentary "Market conditions are improving and momentum is building across the portfolio as we move through 2026," said Scott Schaeffer, Chairman and CEO of IRT. "Lead volume is up meaningfully, new lease rate growth is nearing breakeven, and same-store results are ahead of plan. This operating momentum will translate into durable earnings growth and value creation for shareholders." Second Quarter Summary Net income available to common shares of $3.4 million for the quarter ended June 30, 2026 compared to $8.0 million for the quarter ended June 30, 2025. Earnings per diluted share ("EPS") of $0.01 for the quarter ended June 30, 2026 compared to $0.03 for the quarter ended June 30, 2025. CFFO of $66.6 million for the quarter ended June 30, 2026 compared to $66.7 million for the quarter ended June 30, 2025. CFFO per share was $0.28 for the second quarter of 2026 and for the second quarter of 2025. Same-store portfolio NOI growth of 1.2% for the quarter ended June 30, 2026 compared to the quarter ended June 30, 2025. Adjusted EBITDA of $90.3 million for the quarter ended June 30, 2026 compared to $87.6 million for the quarter ended June 30, 2025. Value Add Program completed renovations of 600 units during the quarter ended June 30, 2026, achieving a weighted average return on investment during the quarter of 16.4%. Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other Non-GAAP financial measures used herein and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP, as well as discussion of our same-store methodology. Same-Store Portfolio(1) Operating Results Value Add Program We completed renovations of 600 units during the three months ended June 30, 2026, achieving a weighted average return on investment of 16.4% with an average cost per unit renovated of $20,477, and an average monthly rent increase per unit of $279 over unrenovated comparable units. We completed renovations of 1,026 units during the six months ended June 30, 2026, achieving a weighted average return on investment of 15.9% with an average cost per unit renovated of $20,430, and an average monthly rent increase per unit of $272 over unrenovated comparable units. See the Value Add Summary page of our supplemental information for additional information on our projects' life to date as of June 30, 2026. Investment Activity Properties Held for Sale As of June 30, 2026, we had two properties classified as held for sale. During the second quarter, we executed a purchase and sale agreement for the disposition of Stonebridge Crossings, with closing expected during the third quarter of 2026. Capital Expenditures Across our total portfolio for the three months ended June 30, 2026, recurring capital expenditures were $12.4 million, or $360 per unit; Value Add Program expenditures were $13.6 million; non-recurring expenditures were $12.9 million; and development expenditures were $0.3 million, respectively. For six months ended June 30, 2026, recurring capital expenditures were $18.5 million, or $537 per unit; Value Add Program expenditures were $22.1 million; non-recurring expenditures were $18.4 million; and development expenditures were $0.2 million, respectively. Balance Sheet and Liquidity At June 30, 2026, our net debt to Adjusted EBITDA was 6.5x. As of the same date and including the effect of hedges, our weighted average effective interest rate on our consolidated debt was 4.3% with a weighted average maturity of 2.9 years, and 86.9% of our debt was either subject to fixed interest rates or was hedged. Also as of June 30, 2026, we had approximately $503.1 million in liquidity through a combination of unrestricted cash and cash equivalents, and capacity under our unsecured revolver. Dividend Distribution On May 13, 2026, our Board of Directors declared a quarterly dividend of $0.18 per share of common stock, which represents a 5.9% increase over the prior quarterly rate of $0.17 per share. The second quarter dividend was paid on July 17, 2026 to stockholders of record at the close of business on June 26, 2026. 2026 EPS, FFO and CFFO Guidance We affirm our guidance ranges for 2026 EPS, FFO, and CFFO per share and same-store NOI. A reconciliation of our projected EPS to our projected FFO and CFFO per share is included below. See the schedules and definitions at the end of this release for further information regarding how we calculate CFFO and for management’s definition and rationale for the usefulness of CFFO. 2026 Guidance Assumptions(1) Our key guidance assumptions for 2026 are enumerated below. See the definitions at the end of this release for further information regarding our same-store definitions. Selected Financial Information See the schedules at the end of this earnings release for selected financial information for IRT. Non-GAAP Financial Measures and Definitions We disclose the following non-GAAP financial measures in this earnings release: FFO, CFFO, NOI and Adjusted EBITDA. Included at the end of this release are definitions of these non-GAAP financial measures and a reconciliation of our reported net income to our FFO and CFFO, a reconciliation of our same-store NOI to our reported net income, a reconciliation of our Adjusted EBITDA to net income, and management’s rationales for the usefulness of each of these and other non-GAAP financial measures used in this release. Conference Call All interested parties can listen to the live conference call webcast at 9:00 AM ET on Tuesday, August 4, 2026 from the Investors section of IRT's website, https://investors.irtliving.com or by dialing 1.833.461.5787, access code 379217423. For those who are not available to listen to the live call, the replay will be available shortly following the live call from the Investors section of IRT’s website until the next earnings release. Supplemental Information We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store portfolio information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investors" section. About Independence Realty Trust, Inc. Independence Realty Trust, Inc. (NYSE: IRT), an S&P 400 MidCap Company, is a real estate investment trust ("REIT") that owns and operates multifamily communities across non-gateway U.S. markets. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT’s main investment objective is to provide attractive risk-adjusted returns to shareholders through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation. More information may be found on the Company’s website, www.irtliving.com. Forward-Looking Statements This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, but are not limited to, our earnings guidance, and the assumptions underlying such guidance, our expectations with respect to the timing and terms of sales, if any, with respect to the two properties which are classified as held for sale as of June 30, 2026, our expectations with respect to projects scheduled to start in 2026 and our expectations with respect to future acquisitions and dispositions. All statements in this release that address financial and operating performance, events or developments that we expect or anticipate will occur or be achieved in the future are forward-looking statements. Our forward-looking statements are not guarantees of future performance and involve estimates, projections, forecasts and assumptions, including as to matters that are not within our control, and are subject to risks and uncertainties including, without limitation, risks and uncertainties related to changes in market demand for rental apartment homes and pricing pressures, including from competitors, that could lead to declines in occupancy and rent levels, uncertainty and volatility in capital and credit markets, including changes that reduce availability, and increase costs, of capital, unexpected changes in our intention or ability to repay certain debt prior to maturity, increased costs on account of inflation, increased competition in the labor market, delays in the completion of, and failure to achieve anticipated benefits of, our projects with our joint venture partners, inability to sell certain assets, including those assets designated as held for sale, within the time frames or at the pricing levels expected, failure to achieve expected benefits from the redeployment of proceeds from asset sales, inability or failure to achieve anticipated benefits from future acquisitions and dispositions, delays in completing, and cost overruns incurred in connection with, our Value Add programs and failure to achieve rent increases and occupancy levels on account of the Value Add programs, unexpected impairments or impairments in excess of our estimates, new and/or increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents and fees or delay or limit our ability to evict non-paying residents, risks endemic to real estate and the real estate industry generally, the impact of potential outbreaks of infectious diseases and measures intended to prevent the spread or address the effects thereof, economic conditions, including inflation and recessionary conditions and their related impacts on the real estate industry, U.S. and global trade policies and tensions, including changes in, or the imposition of, tariffs and/or trade barriers and the economic impacts, volatility and uncertainty resulting therefrom, the impacts from existing and/or future U.S. foreign policy decisions including the involvement of the U.S. in foreign disputes and foreign wars, the effects of natural and other disasters, unknown or unexpected liabilities, including the cost of legal proceedings, costs and disruptions as the result of a cybersecurity incident or other technology disruption, including but not limited to a third party's unauthorized access to our data or the data of our residents, unexpected capital needs, inability to obtain appropriate insurance coverages at reasonable rates, or at all, or losses from catastrophes in excess of our insurance coverages, and share price fluctuations. Please refer to the documents filed by us with the SEC, including specifically the "Risk Factors" sections of our Annual Report on Form 10-K for the year ended December 31, 2025 and our other filings with the SEC, which identify additional factors that could cause actual results to differ from those contained in forward-looking statements. These forward-looking statements are based upon the beliefs and expectations of our management at the time of this release and our actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law. Schedule VIndependence Realty Trust, Inc.Definitions Average Effective Monthly Rent per Unit Average effective rent per unit represents the average of net rent amounts, after concessions amortized over the life of the lease, divided by the average occupancy (in units) for the period presented. We believe average effective rent is a helpful measurement in evaluating average pricing. This metric, when presented, reflects the average effective rent per month. Average Occupancy Average occupancy represents the average occupied units for the reporting period divided by the average of total units available for rent for the reporting period. Development Property A development property is a property that is either currently under development or is in lease-up prior to reaching overall occupancy of 90%. EBITDA and Adjusted EBITDA Each of EBITDA and Adjusted EBITDA is a non-GAAP financial measure. EBITDA is defined as net income before interest expense including amortization of deferred financing costs, income tax expense, and depreciation and amortization expenses. Adjusted EBITDA is EBITDA before certain other non-cash or non-operating gains or losses related to items such as loss on impairment (gain on sale) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses and income (loss) from investments in unconsolidated real estate entities. We consider each of EBITDA and Adjusted EBITDA to be an appropriate supplemental measure of performance because it eliminates interest, income taxes, depreciation and amortization, and other non-cash or non-operating gains and losses, which permits investors to view income from operations without these non-cash or non-operating items. Our calculation of Adjusted EBITDA differs from the methodology used for calculating Adjusted EBITDA by certain other REITs and, accordingly, our Adjusted EBITDA may not be comparable to Adjusted EBITDA reported by other REITs. Funds From Operations ("FFO") and Core Funds From Operations ("CFFO") We believe that FFO and CFFO, each of which is a non-GAAP financial measure, are additional appropriate measures of the operating performance of a REIT and us in particular. We compute FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts ("NAREIT"), as net income or loss allocated to common shares (computed in accordance with GAAP), excluding real estate-related depreciation and amortization expense, loss on impairment (gain on sale) of real estate and unconsolidated real estate entities, and the cumulative effect of changes in accounting principles. While our calculation of FFO is in accordance with NAREIT’s definition, it may differ from the methodology for calculating FFO utilized by other REITs and, accordingly, may not be comparable to FFO computations of such other REITs. CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash or non-operating gains or losses related to items such as casualty (gains) losses, loan premium accretion and discount amortization and debt extinguishment costs from the determination of FFO. Our calculation of CFFO may differ from the methodology used for calculating CFFO by other REITs and, accordingly, our CFFO may not be comparable to CFFO reported by other REITs. Our management utilizes FFO and CFFO as measures of our operating performance, management believes they are also useful to investors, because they facilitate an understanding of our operating performance after adjustment for certain non-cash or non-recurring items that are required by GAAP to be expensed but may not necessarily be indicative of current operating performance and our operating performance between periods. Furthermore, although FFO, CFFO and other supplemental performance measures are defined in various ways throughout the REIT industry, we believe that FFO and CFFO may provide us and our investors with an additional useful measure to compare our financial performance to certain other REITs. Neither FFO nor CFFO is equivalent to net income or cash generated from operating activities determined in accordance with GAAP. Furthermore, FFO and CFFO do not represent amounts available for management’s discretionary use because of needed capital replacement or expansion, debt service obligations or other commitments or uncertainties. Accordingly, FFO and CFFO do not measure whether cash flow is sufficient to fund all of our cash needs, including principal amortization and capital improvements. Neither FFO nor CFFO should be considered as an alternative to net income or any other GAAP measurement as an indicator of our operating performance or as an alternative to cash flow from operating, investing, and financing activities as a measure of our liquidity. Interest Coverage Interest coverage is a ratio computed by dividing Adjusted EBITDA by interest expense. Lease Over Lease Effective Rent Growth Lease Over Lease Effective Rent Growth represents the change in the weighted average effective monthly rental rate, including the impact of concessions, of a lease compared to the prior lease for that same unit. We report this statistic on both a like-term basis and an all leases basis. The like-term basis includes cases where both the current and prior lease associated with a unit reflect standard leasing activity and have terms of 9-14 months. An all leases basis includes all leases regardless of lease terms. We may report Lease Over Lease Effective Rent Growth for new leases, renewal leases, or blended across both new and renewal leases. Net Debt Net debt, a non-GAAP financial measure, equals total consolidated debt less cash and cash equivalents and loan premiums and discounts. The following table provides a reconciliation of total consolidated debt to net debt (dollars in thousands). We present net debt and net debt to Adjusted EBITDA because management believes it is a useful measure of our credit position and progress toward reducing leverage. The calculation is limited because we may not always be able to use cash to repay debt on a dollar for dollar basis. Net Operating Income We believe that Net Operating Income ("NOI"), a non-GAAP financial measure, is a useful measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expense, depreciation and amortization, casualty related costs and gains, property management expenses, general and administrative expenses and net gains on sale of assets. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as an alternative measure of our financial performance. Non Same-Store Properties and Non Same-Store Portfolio Properties that did not meet the definition of a same-store property as of the beginning of the previous year. Same-Store Properties and Same-Store Portfolio We review our same-store portfolio at the beginning of each calendar year. Properties are added into the same-store portfolio if they were owned and not a development property at the beginning of the previous year. Properties that are held for sale or have been sold are excluded from the same-store portfolio. Rent Premium on Value Add Renovations The rent premium reflects the per unit per month difference between the rental rate on the renovated unit excluding the impact of upfront concessions, if any, and the market rent for an unrenovated unit as of the date presented, as determined by management consistent with its customary rent-setting and evaluation procedures. We believe excluding the impact of upfront concessions from our rental rates when comparing to the market rental rates for unrenovated units makes the comparison most relevant and the resulting premium provides management with an indicator of the increased rent generated by the unit renovation. Renovation Costs per Unit Renovation costs per unit includes all costs to renovate the interior units and make certain exterior renovations, including clubhouses and amenities. Interior costs per unit are based on units leased. Exterior costs per unit are based on total units at the community. Excludes overhead costs to support and manage the value add program as those costs relate to the entire program and cannot be allocated to individual projects. Return on Investment ("ROI") on Value Add Renovations ROI is calculated using the Rent Premium per unit per month, multiplied by 12, divided by the interior renovation costs per unit or the total renovation costs, as applicable. We use ROI on value add renovation projects to measure the profitability of a renovation project relative to other projects or relative to other uses of our capital. Total Gross Assets Total Gross Assets equals total assets plus accumulated depreciation and accumulated amortization, including fully depreciated or amortized real estate and real estate related assets. The following table provides a reconciliation of total assets to total gross assets (dollars in thousands). View source version on businesswire.com: https://www.businesswire.com/news/home/20260803832631/en/ Contacts IRT Investor Relations Contact: Stephanie [email protected]

LPL Financial Holdings Inc. (LPLA) came out with quarterly earnings of $5.84 per share, beating the Zacks Consensus Estimate of $5.39 per share. This compares to earnings of $4.51 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +8.35%. A quarter ago, it was expected that this company would post earnings of $5.49 per share when it actually produced earnings of $5.6, delivering a surprise of +2%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. LPL Financial, which belongs to the Zacks Financial - Investment Bank industry, posted revenues of $5.05 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.31%. This compares to year-ago revenues of $3.75 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. LPL Financial shares have lost about 5.4% since the beginning of the year versus the S&P 500's gain of 6.9%. While LPL Financial has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for LPL Financial was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $5.85 on $5.32 billion in revenues for the coming quarter and $23.38 on $20.71 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Financial - Investment Bank is currently in the top 9% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Independence Realty Trust (IRT), another stock in the broader Zacks Finance sector, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 3. This real estate investment trust is expected to post quarterly earnings of $0.27 per share in its upcoming report, which represents a year-over-year change of -3.6%. The consensus EPS estimate for the quarter has been revised 1.5% higher over the last 30 days to the current level. Independence Realty Trust's revenues are expected to be $169.18 million, up 4.3% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report LPL Financial Holdings Inc. (LPLA) : Free Stock Analysis Report Independence Realty Trust, Inc. (IRT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

PHILADELPHIA, May 13, 2026--(BUSINESS WIRE)--Independence Realty Trust, Inc. (NYSE: IRT) ("IRT") announces that its board of directors approved a quarterly dividend of $0.18 per share of IRT common stock, which represents a 5.9% increase over the prior quarterly rate of $0.17 per share. The second quarter 2026 dividend is payable on July 17, 2026, to shareholders of record at the close of business on June 26, 2026. "The Board's decision to increase our quarterly dividend reflects our conviction in the strength of our operating platform and the improving fundamentals we are seeing across our markets," said Scott Schaeffer, Chairman and CEO of IRT. "Demand for quality apartment homes remains resilient, and we are well-positioned to capture the benefits of a favorable supply-demand environment as new deliveries moderate. This increase is a direct expression of our confidence in our ability to grow cash flow and deliver sustainable, long-term value to our shareholders." About IRT Independence Realty Trust, Inc. (NYSE: IRT), an S&P 400 MidCap Company, is a real estate investment trust ("REIT") that owns and operates multifamily communities, across non-gateway U.S. markets. IRT’s investment strategy is focused on gaining scale near major employment centers within key amenity rich submarkets that offer good school districts and high-quality retail. IRT’s main investment objective is to provide attractive risk-adjusted returns to shareholders through diligent portfolio management, strong operational performance, and a consistent return on capital through distributions and capital appreciation. More information may be found on the Company’s website, www.irtliving.com. Forward-Looking Statements This release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements include, but are not limited to, our earnings guidance, and the assumptions underlying such guidance, our expectations with respect to the timing and terms of sales, if any, with respect to the two properties which are classified as held for sale as of March 31, 2026, the assumptions underlying the determination of the fair value of our impairment charge for one of our properties held for sale as of March 31, 2026, our expectations with respect to projects scheduled to start in 2026 and our expectations with respect to future acquisitions and dispositions. All statements in this release that address financial and operating performance, events or developments that we expect or anticipate will occur or be achieved in the future are forward-looking statements. Our forward-looking statements are not guarantees of future performance and involve estimates, projections, forecasts and assumptions, including as to matters that are not within our control, and are subject to risks and uncertainties including, without limitation, risks and uncertainties related to changes in market demand for rental apartment homes and pricing pressures, including from competitors, that could lead to declines in occupancy and rent levels, uncertainty and volatility in capital and credit markets, including changes that reduce availability, and increase costs, of capital, unexpected changes in our intention or ability to repay certain debt prior to maturity, increased costs on account of inflation, increased competition in the labor market, delays in the completion of, and failure to achieve anticipated benefits of, our projects with our joint venture partners, inability to sell certain assets, including those assets designated as held for sale, within the time frames or at the pricing levels expected, failure to achieve expected benefits from the redeployment of proceeds from asset sales, inability or failure to achieve anticipated benefits from future acquisitions and dispositions, delays in completing, and cost overruns incurred in connection with, our Value Add initiatives and failure to achieve rent increases and occupancy levels on account of the Value Add initiatives, unexpected impairments or impairments in excess of our estimates, new and/or increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents and fees or delay or limit our ability to evict non-paying residents, risks endemic to real estate and the real estate industry generally, the impact of potential outbreaks of infectious diseases and measures intended to prevent the spread or address the effects thereof, economic conditions, including inflation and recessionary conditions and their related impacts on the real estate industry, U.S. and global trade policies and tensions, including changes in, or the imposition of, tariffs and/or trade barriers and the economic impacts, volatility and uncertainty resulting therefrom, the impacts from a new or prolonged U.S. government shutdown, the impacts from existing and/or future U.S. foreign policy decisions including the involvement of the U.S. in foreign disputes and foreign wars, the effects of natural and other disasters, unknown or unexpected liabilities, including the cost of legal proceedings, costs and disruptions as the result of a cybersecurity incident or other technology disruption, including but not limited to a third party's unauthorized access to our data or the data of our residents, unexpected capital needs, inability to obtain appropriate insurance coverages at reasonable rates, or at all, or losses from catastrophes in excess of our insurance coverages, and share price fluctuations. Please refer to the documents filed by us with the SEC, including specifically the "Risk Factors" sections of our Annual Report on Form 10-K for the year ended December 31, 2025 and our other filings with the SEC, which identify additional factors that could cause actual results to differ from those contained in forward-looking statements. These forward-looking statements are based upon the beliefs and expectations of our management at the time of this release and our actual results may differ materially from the expectations, intentions, beliefs, plans or predictions of the future expressed or implied by such forward-looking statements. We undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as may be required by law. View source version on businesswire.com: https://www.businesswire.com/news/home/20260513572333/en/ Contacts Investor Relations: Stephanie Krewson-Kelly 267-270-4815 [email protected]

Core FFO $0.26 in Q1 with same-store NOI +1% and revenue +1.4%, occupancy steady at 95.2%; management affirmed full-year Core FFO guidance of $1.12–$1.16 and said results were in line with expectations. Asking rents are improving (same-store asking rents +2.8% YTD, led by Raleigh +5.7% and Indianapolis +5.2%), but concessions remain elevated—about 27% of like-term new leases included concessions averaging $1,241—and new-lease trade-outs were -4%, though early Q2 renewal trends are encouraging. Capital allocation and balance sheet: IRT repurchased 1.8 million shares for $30M in the quarter (3.7M/$60M since Q4), completed 426 renovation units with a 15.4% unlevered return, is marketing held-for-sale assets, and reported net debt/adjusted-EBITDA of 6.5x with no debt maturities until 2028 and an expected move toward the mid-5x range. Interested in Independence Realty Trust, Inc.? Here are five stocks we like better. The 3 Most Promising Real Estate Stocks to Watch this Quarter Independence Realty Trust (NYSE:IRT) reported first-quarter 2026 results that management said were in line with expectations, pointing to stable occupancy, improving rent trends across its markets, and continued emphasis on capital allocation through renovations, asset sales, and share repurchases. Chief Executive Officer Scott Schaeffer said the quarter represented “a solid start to the year,” with same-store revenue and net operating income (NOI) increasing. Schaeffer attributed the results to “stable year-over-year occupancy and a 40 basis point increase in effective rents,” and said performance reinforced three themes: “portfolio stability, improving market fundamentals, and disciplined capital allocation.” → Corning Beats Q1 Estimates but Drops 9% on Guidance Miss President and CFO Jim Sebra reported core funds from operations (Core FFO) of $0.26 per share. Same-store NOI increased 1% year-over-year, which Sebra said was driven by revenue growth “consistent with expectations” and “modest outperformance on operating expenses.” Same-store revenue grew 1.4% year-over-year, supported by stable occupancy of 95.2%, higher average rental rates, growth in other income, and bad debt that was 60 basis points lower than the first quarter of last year. On expenses, Sebra said lower property insurance and repairs and maintenance were partly offset by higher personnel and utility costs, resulting in same-store expense growth of 2%. → Meta Posted Its Best Sales Growth Since 2021—So Why Did Shares Fall? Management highlighted improving rent indicators heading into the peak leasing season, while noting concessions remain elevated compared with historical levels. Schaeffer said asking rents in the company’s markets have increased an average of 2.8% this year, and “every one of our markets has seen asking rents increase since January first.” He added that concession activity has started to moderate but “is still elevated compared to historical levels.” Sebra said asking rents across the same-store portfolio were up 2.8% since the start of the year, a notable acceleration from the 73 basis points cited on the company’s February call. He highlighted several markets with the strongest increases to date: Raleigh (up 5.7%), Indianapolis (up 5.2%), Oklahoma City (up 4.8%), Columbus (up 4.6%), and Nashville (up 4.5%). In the company’s two largest markets, Sebra said Atlanta was up 80 basis points year-to-date, while Dallas was up 2.1%. → Is Oracle Undervalued as Cloud Growth Accelerates? Concessions continued to weigh on new lease trade-outs in the quarter. Sebra said approximately 27% of like-term leases in the first quarter included a concession, averaging $1,241. Blended rent growth was 70 basis points for the first quarter, which he said was consistent with the company’s full-year guidance assumption of 1.7%. Renewal rate growth was 3.2%, with resident retention of 60.5%. New lease trade-outs were negative 4% in the quarter, which Sebra said was in line with prior commentary. He noted that “our gross lease trade outs are at break-even levels,” and said most of the negative impact on new leases was driven by “higher than normal concession activity.” Sebra said early second-quarter trends were “directionally encouraging,” with April and May renewal trade-outs tracking modestly ahead of plan at about 4%. In response to analyst questions about strategy, Schaeffer said the company’s shift toward pushing rent growth reflects a plan established late last year as supply pressure began to subside. “During that period of excess deliveries, we really were focused on keeping our occupancy high,” he said, adding that the company now believes it can “start pushing rents while still keeping occupancy stable.” Sebra said renewals for April and May were in the “low 4% range,” with June and July “a little ahead of that.” On the path to improvement in blended rent growth, Sebra said he expects the more meaningful ramp to become visible “in the kind of the September forward months,” citing easier comparisons related to heavier concessions in 2025 and expectations for stronger renewal growth in the back half of 2026. Executive Vice President of Operations Janice Richards pointed to Atlanta, Raleigh, and Nashville as markets showing positive momentum, supported by moderating supply and improving pricing power. She said Atlanta delivered “an 80 basis point re-rent build up on top of what we saw at the tail end of last year,” while Raleigh led with 5.7% asking rent growth and Nashville followed at 4.5%. Looking ahead, Richards said Raleigh and Atlanta are expected to benefit from a meaningful decline in supply as a percentage of inventory compared to 2025, which she said supports continued rent growth and stabilized occupancy. Richards also flagged markets where supply pressures persist. She said Denver and Austin “remain supply driven and will continue to experience pressures from elevated new deliveries,” though she noted Austin’s household formation is the highest among the company’s markets at 2.3, which she said could help absorption as supply moderates. Richards described some first-quarter softness in Orlando, Tampa, and Houston, characterizing Houston’s softness as temporary and tied to expectations for strength in oil production in the second half. She also said Orlando is seeing movement related to return-to-office activity while still working through late-cycle supply pressures, and that Tampa has seen some impact from hurricane-related displacement following the fourth quarter of 2024. Asked about winter storms, Richards said the company saw “some slowness in demand in January and February,” but demand later improved and “exceeded our demand expectations by about 10% for Q1 holistically.” On smaller markets such as Huntsville, Richards said the market is still working through supply pressures, but she emphasized the company remains “very bullish” and said there were “no challenges from a demand side.” Management reiterated a focus on value-add renovations and capital recycling. Schaeffer said value-add renovations remain the company’s “most attractive investment opportunity.” During the quarter, IRT completed 426 renovation units, generating an average unlevered return of 15.4%. Schaeffer said the company remains on track for its full-year assumption of completing 2,000 to 2,500 units in 2026. On recycling capital, Schaeffer said the company continues to make progress on two assets held for sale, and that its Las Colinas joint venture asset in Dallas, known as The Mustang, is being marketed. He said proceeds could be redeployed toward “stock repurchases, deleveraging, and/or new investments.” The company also highlighted share repurchases. Schaeffer said IRT repurchased 1.8 million shares during the quarter for $30 million, bringing total repurchases since the fourth quarter of last year to 3.7 million shares for $60 million. Sebra described the balance sheet as “investor grade” with ample liquidity and no debt maturities until 2028. Net debt to adjusted EBITDA was 6.5x at quarter-end, which he said reflected seasonally lower first-quarter EBITDA and the impact of consolidating the company’s Boston joint venture asset in January. Sebra said he expects leverage to trend down toward the mid-5x range over the course of the year, aided by proceeds from pending asset sales and longer-term EBITDA growth. IRT affirmed its full-year Core FFO per share guidance range of $1.12 to $1.16, with Sebra saying management is “comfortable with the major assumptions that support that range.” Sebra provided an update on the company’s property Wi-Fi initiative, stating IRT is installing property Wi-Fi across 19,000 units this year and expects the rollout to be completed and operating on July 1. He said the project is slightly ahead of schedule, and noted residents are “excited about the new gig speed Wi-Fi.” Sebra added that other income has grown about 5% over the prior year so far, and that there may be “a little bit of potential upside” to the company’s other income assumptions tied to the Wi-Fi program, though he did not provide a specific update to guidance. Addressing development and lease-up activity, Sebra said Arista in Broomfield, Colorado is fully occupied and stabilized and is now in the same-store pool. He said Flatirons, also in Broomfield, was about 82% leased and 66% occupied, and is expected to stabilize in the low 90% occupancy level in June or early July. Sebra noted rental rates at Flatirons are “a little behind our initial underwrite expectations,” but said management believes it remains a good long-term investment. He also discussed The Tisdale at Lakeline Station, a joint venture asset in Austin that was added to the company’s in-development disclosure during the quarter. Sebra said it is early in lease-up at about 37% leased and 33% occupied, up from roughly 25% occupied when IRT took it over and began managing and consolidating it. On dispositions, Senior Vice President of Acquisitions and Dispositions Jason Lynch said the company is still targeting mid-year for the sale of the two held-for-sale properties and is actively marketing them. In closing remarks, Schaeffer said the company is “firmly on track to achieve our 2026 plan,” citing improving market fundamentals, durable demand in its submarkets, and early signs of improvement in new lease trade-outs during April. Independence Realty Trust is a self-administered equity real estate investment trust that acquires, redevelops and manages multi-family communities. The company focuses on workforce housing, targeting Class A and B garden-style apartments in suburban and urban infill locations. Its core activities include sourcing value-add acquisitions, overseeing property renovations and delivering in-house property management services to optimize rental income and occupancy levels. Headquartered in Wayne, Pennsylvania, Independence Realty Trust maintains a geographically diverse portfolio across several high-growth U.S. The article "Independence Realty Trust Q1 Earnings Call Highlights" was originally published by MarketBeat.

Management is pivoting from an occupancy-first strategy to prioritizing rental rate growth as supply-demand dynamics improve across core markets. Performance was driven by stable average occupancy of 95.2% and high resident retention of 60.5%, providing a foundation for aggressive leasing season pricing. Asking rents increased by an average of 2.8% year-to-date, with every market seeing gains since January 1, signaling a recovery from late-cycle supply pressures. The value-add renovation program remains the primary investment driver, with 426 units completed in Q1 at a 15.4% average unlevered return. Sunbelt and Midwest demand remains durable, supported by population inflows and household formation that management expects to outpace national averages. Concession activity remains elevated compared to historical levels but has begun to moderate, particularly in submarkets where supply is being absorbed. Management expects new lease trade-outs to reach breakeven during the current leasing season as market rent growth offsets current concession levels. The property WiFi initiative is ahead of schedule, with full implementation across 19,000 units expected by July 1, 2026, providing potential revenue upside. Guidance assumes a significant ramp in the second half of the year, driven by easier year-over-year comparisons and lower expiring rents relative to current asking prices. Leverage is projected to trend lower toward the mid-5s by year-end, aided by organic EBITDA growth and proceeds from planned asset recycling. The company plans to complete 2,000 to 2,500 value-add unit renovations for the full year 2026, maintaining its current execution pace. The company repurchased 1.8 million shares for $30 million in Q1, citing a strategic decision to capitalize on public market dislocation. Two assets are currently held for sale, and a joint venture asset in Dallas is being marketed to fund deleveraging or future investments. Supply-driven pressures persist in Denver and Austin, though management believes high household formation in Austin will eventually support absorption. Bad debt improved by 60 basis points year-over-year, contributing to the 1.4% same-store revenue growth. Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management confirmed this shift was planned for the 2026 leasing season as supply deliveries began to trend below long-term averages. Renewal offers for May and June are tracking in the 4% range, indicating confidence in the ability to push rates without sacrificing stability. New lease pricing improved by approximately 130 basis points in April and May compared to the first quarter. Management stated that even if concessions remain flat, they expect to reach breakeven on new leases because expiring rents are currently below asking rents. While value-add occupancy is structurally lower due to renovation downtime, it generated 3.2% NOI growth compared to 50 basis points for the non-value-add portfolio. Management remains bullish on the program as a primary driver for hitting full-year targets. Raleigh is leading the portfolio with 5.7% asking rent growth, while Atlanta saw a 1.5% blended rent growth, double its Q4 rate. Both markets are expected to benefit from a significant decline in new supply as a percentage of inventory in the coming year. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here.