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FALSE000146608500014660852023-10-262023-10-26

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________________________
FORM 8-K
_____________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 26, 2023
_____________________________________________
Independence Realty Trust, Inc.
(Exact name of registrant as specified in its charter)
_____________________________________________
Maryland
001-36041
26-4567130
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(I.R.S. Employer
Identification No.)
1835 Market Street, Suite 2601
Philadelphia, Pennsylvania, 19103
(Address of Principal Executive Office) (Zip Code)
(267) 270-4800
(Registrant’s telephone number, including area code)
N/A
Former name or former address, if changed since last report
_____________________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common stock
IRT
NYSE
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o Item 2.02 Results of Operations and Financial Condition.





On October 30, 2023, we issued a press release announcing our financial results for the three and nine months ended September 30, 2023. Additionally, we are furnishing certain supplemental information with this Current Report. Copies of such press release and such supplemental information are furnished as Exhibit 99.1 and Exhibit 99.2, respectively, to this Current Report and are incorporated by reference into this Item 2.02. The information in this Item 2.02, including Exhibit 99.1 and Exhibit 99.2 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Item 2.02 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
Item 2.06     Material Impairments.
On October 26, 2023, our Board of Directors approved a plan, which we refer to as our “Portfolio Optimization and Deleveraging Strategy,” to exit or reduce our presence in certain markets. Our Portfolio Optimization and Deleveraging Strategy targets sales of 10 properties (collectively, the “Targeted Sales Properties”), including one property in Chicago, Illinois that was held for sale as of September 30, 2023. The Targeted Sales Properties contain an aggregate of 2,742 units and are located in or around Denver, Colorado, Houston, Texas, Chicago, Illinois, Fort Wayne, Indiana, Chattanooga, Tennessee, Norfolk, Virginia and Asheville, North Carolina.
In accordance with U.S. generally accepted accounting principles (“GAAP”), we have recorded an impairment charge for the third quarter 2023 of $11.3 million related to our property in Chicago, Illinois that was held for sale as of September 30, 2023. In addition, as of the date of this Current Report, we have determined that we will be required, under GAAP, to record an impairment charge in the fourth quarter 2023 for three other Targeted Sales Properties and currently estimate the amount of the impairment charge to be between $23 and $25 million, in aggregate.
Due to the early stage of our sales activities with respect to the other six Targeted Sales Properties, as of the date of this Current Report, given currently available information, and pending the outcome of the sales processes, we expect to incur impairment charges for certain of these properties in the fourth quarter 2023 ranging between $32 and $38 million, in aggregate.
Our estimates of impairment charges are preliminary and subject to change. The actual amount of impairment charges may be higher or lower than our estimates and will depend on the terms of actual sales, if any. There can be no assurance that any of the targeted sales will be consummated within the contemplated prices ranges, within the contemplated time frames, or at all.
Item 7.01    Regulation FD Disclosure.
The information provided in Item 2.02 above is incorporated by reference into this Item 7.01. The information incorporated by reference into this this Item 7.01 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information incorporated by reference into this Item 7.01 shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
Forward-Looking Statements
This document includes 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 certain actions that we expect or seek to take in connection with our Portfolio Optimization and Deleveraging Strategy and anticipated enhancements to our financial results and future growth from this strategy. All statements in this document 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, failure to realize cost savings, efficiencies and other benefits that we expect to result from our Portfolio Optimization and Deleveraging Strategy, 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, 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, increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents 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, 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, 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, 2022, 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.
Forward-looking statements are based upon the beliefs and expectations of our management at the date of this Current Report 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.
Item 9.01    Financial Statements and Exhibits.
(d)Exhibits.
99.1
99.2
104 Cover Page Interactive Data File (embedded within the Inline XBRL document).


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Independence Realty Trust, Inc.
October 30, 2023 By: /s/ James J. Sebra
Name: James J. Sebra
Title: Chief Financial Officer and Treasurer

EX-99.1 2 irt-20231030xsupex991.htm EX-99.1 Document

Exhibit 99.1


Independence Realty Trust Announces Third Quarter 2023 Financial Results
Initiates Portfolio Optimization and Deleveraging Strategy
Updates Full Year 2023 Guidance

PHILADELPHIA – (BUSINESS WIRE) – October 30, 2023 — Independence Realty Trust, Inc. (“IRT”) (NYSE: IRT), a multifamily apartment REIT, today announced its third quarter 2023 financial results, initiated its portfolio optimization strategy and updated its full year 2023 guidance.
Third Quarter Highlights
•Net income available to common shares of $3.9 million for the quarter ended September 30, 2023 compared to $16.2 million for the quarter ended September 30, 2022.
•Earnings per diluted share of $0.02 for the quarter ended September 30, 2023 compared to $0.07 for the quarter ended September 30, 2022.
•Same-store portfolio net operating income (“NOI”) growth of 4.8% for the quarter ended September 30, 2023 compared to the quarter ended September 30, 2022.
•Core Funds from Operations (“CFFO”) of $69.0 million for the quarter ended September 30, 2023 compared to $64.3 million for the quarter ended September 30, 2022. CFFO per share was $0.30 for the third quarter of 2023, as compared to $0.28 for the third quarter of 2022.
•Adjusted EBITDA of $94.4 million for the quarter ended September 30, 2023 compared to $89.3 million for the quarter ended September 30, 2022, an increase of 5.7%.
•Value add program completed renovations at 709 units during the quarter ended September 30, 2023, achieving a weighted average return on investment during the quarter of 14.2%.
Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other Non-GAAP financial measures and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP.
Management Commentary
“For the third quarter of 2023, we delivered growth of 4.8% in same store NOI and 7.1% in Core FFO per share and we remain focused on delivering sustainable operational efficiencies. We are updating our full year 2023 guidance to reflect the impact of the slowing macroeconomic environment on leasing activity.” said Scott Schaeffer, Chairman and CEO of IRT. “We are also commencing a portfolio optimization and deleveraging strategy that will accelerate non-core asset sales while deleveraging our balance sheet in the near-term. We expect these initiatives will increase our financial flexibility and will reduce leverage by almost a full turn upon completion of all asset sales. We are confident that these initiatives will strengthen our balance sheet and improve our presence in the multifamily sector in 2024.”
1

Same-Store Portfolio(1) Operating Results
Third Quarter 2023
 Compared to
 Third Quarter 2022
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022
Rental and other property revenue 5.4% increase 6.3% increase
Property operating expenses 6.3% increase 6.2% increase
Net operating income (“NOI”) 4.8% increase 6.4% increase
Portfolio average occupancy 40 bps increase to 94.6% 120 bps decrease to 93.9%
Portfolio average rental rate 4.4% increase to $1,549 7.7% increase to $1,536
NOI Margin 40 bps decrease to 62.4% No change — 62.6%
(1)Same-store portfolio includes 115 properties, which represent 34,197 units.
Operating Metrics
The table below summarizes operating metrics for the same-store portfolio for the applicable periods.
3Q 2023
4Q 2023(3)
Same-Store Portfolio(1)
   Average Occupancy 94.6  % 94.3  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 0.8  % (2.3) %
        Renewal Leases 4.8  % 5.0  %
        Blended 3.0  % 2.3  %
   Resident retention rate 52.3  % 48.4  %
Same-Store Portfolio excluding Ongoing Value Add
   Average Occupancy 95.0  % 94.7  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 0.3  % (2.5) %
        Renewal Leases 4.6  % 4.8  %
        Blended 2.7  % 2.1  %
   Resident retention rate 52.6  % 47.7  %
Value Add (22 properties with Ongoing Value Add)
   Average Occupancy 92.8  % 92.8  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 2.8  % (1.6) %
        Renewal Leases 5.9  % 6.3  %
        Blended 4.5  % 3.0  %
   Resident retention rate 51.2  % 51.3  %
(1)Same-store portfolio includes 115 properties, which represent 34,197 units.
(2)Lease-over-lease effective rent growth represents the change in effective monthly rent, as adjusted for concessions, for each unit that had a prior lease and current lease that are for a term of 9-13 months.
(3)4Q 2023 average occupancy and resident retention rates are through October 28, 2023. 4Q 2023 new lease and renewal rates are for leases commencing during 4Q 2023 that were signed as of October 28, 2023.
(4)As of October 28, 2023, same-store portfolio occupancy was 94.6%, same-store portfolio excluding ongoing value add occupancy was 95.0%, and value add occupancy was 93.1%.
Portfolio Optimization and Deleveraging Strategy

We continuously evaluate opportunities for the potential disposition of properties in our portfolio by considering a variety of criteria including, but not limited to, local market conditions and lease rates, our scale within the
2

markets, our view of market demographics and growth prospects and potential uses of sales proceeds. Subsequent to September 30, 2023, our Board of Directors approved a plan, which we refer to as our Portfolio Optimization and Deleveraging Strategy, to exit or reduce our presence in certain markets while also deleveraging our balance sheet. Our Portfolio Optimization and Deleveraging Strategy targets sales of approximately 10 properties that are located in seven markets, including the one property in Chicago, Illinois that was held for sale as of September 30, 2023. Nine of the 10 properties were acquired in December 2021 as part of the STAR merger. We currently expect these asset sales to generate gross sales proceeds of approximately $521 to $533 million with proceeds used to immediately delever our balance sheet.
We estimate that these asset sales, if consummated within the foregoing price range, will enable us to reduce our outstanding debt by approximately $516 to $528 million (comprised of $284 million of property level debt associated with the ten properties and $232 to $244 million of additional debt), will reduce our net debt to adjusted EBITDA ratio by 0.8x to 0.9x, and will be dilutive to Core FFO per share by $0.02-$0.03. In addition, consummation of the targeted sales would reduce our market exposures by five single asset markets and reduce the average age of the properties in our portfolio by approximately one year.
We expect to recognize an aggregate net loss after completion of all sales in the range of approximately $39 to $51 million comprised of an $11.3 million impairment charge recorded during the three months ended September 30, 2023 related to our property in Chicago, Illinois that is currently held for sale; an estimated $55 to $63 million impairment charge we expect to recognize during the fourth quarter of 2023 with respect to certain of the properties targeted for sale; and estimated gains of approximately $24 to $28 million we expect to realize in the periods of sale of certain of the properties targeted for sale.
We are in various stages of marketing, negotiations, and buyer due diligence with respect to the properties targeted for sale. There can be no assurance that any of the sales will be consummated at expected pricing levels, within expected time frames, or at all. The estimates of sale prices discussed above are based on our assessment of current conditions in the markets where the properties are located, comparable sales data, characteristics and operating performance of the properties among other factors and are subject to numerous assumptions.
Value Add Program
We completed renovations on 709 units during the quarter ended September 30, 2023, achieving a return on investment of 14.2% (and approximately 15.3% on the interior portion of such renovation costs), with an average cost per unit renovated of $17,750, and an average monthly rent increase per renovated unit of $210. For the nine months end September 30, 2023, we have completed renovations on 1,969 units, achieving a return on investment of 16.0% (and approximately 17.3% on the interior portion of such renovation costs), with an average cost per unit renovated of $16,947, and an average monthly rent increase per renovated unit of $224. See the Value Add Summary page of our supplemental for additional information on our projects life to date as of September 30, 2023.
Investment Activity
Capital Expenditures
For the three months ended September 30, 2023, recurring capital expenditures for the total portfolio were $5.3 million, or $153 per unit. For the nine months ended September 30, 2023, recurring capital expenditures for the total portfolio were $15.8 million, or $454 per unit.
Capital Markets
Dividend Distribution
On September 12, 2023, our Board of Directors declared a quarterly dividend of $0.16 per share of common stock. The third quarter dividend was paid on October 20, 2023 to stockholders of record at the close of business on September 29, 2023.
3

2023 EPS, FFO and CFFO Guidance
We reduced our EPS, FFO, and CFFO per share guidance ranges and our same store NOI guidance range. Earnings (loss) per diluted share is now projected to be in the range of ($0.07) to ($0.02). A reconciliation of IRT's projected net (loss) income allocable to common shares to its projected CFFO per share is included below. See the schedules and definitions at the end of this release for further information regarding how IRT calculates CFFO and for management’s definition and rationale for the usefulness of CFFO.
Previous Guidance Current Guidance Change at Midpoint
2023 Full Year EPS and CFFO Guidance(1)(2)
 Low High Low High
Earnings (loss) per share $ 0.25  $ 0.27  $ (0.07) $ (0.02) $ (0.305)
Adjustments:
Depreciation and amortization
 0.95  0.95  0.94  0.94  (0.01)
(Gain on sale) loss on impairment of
  real estate assets(3)
 (0.01) (0.01) 0.32  0.28  0.31 
FFO per share 1.19  1.21  1.19  1.20  (0.005)
Loan (premium accretion) discount
  amortization, net		 (0.05) (0.05) (0.05) (0.05) — 
Core FFO per share $ 1.14  $ 1.16  $ 1.14  $ 1.15  $ (0.005)
(1)This guidance, including the underlying assumptions presented in the table below, constitutes forward-looking information. Actual full year 2023 EPS, FFO, and CFFO could vary significantly from the projections presented. See “Forward-Looking Statements” . Our guidance is based on the key guidance assumptions detailed below.
(2)Per share guidance is based on 230.4 million weighted average shares and units outstanding.
(3)Gain on sale (loss on impairment) of real estate assets includes gains (impairments) on one asset sale that occurred during the first quarter of 2023, one property identified as held for sale as of September 30, 2023, and nine other assets targeted for sale as part of our Portfolio Optimization and Deleveraging Strategy.
4

2023 Guidance Assumptions
Our key guidance assumptions for 2023 are enumerated below. See definitions at the end of this release for further information regarding our same-store definitions.
Same-Store Portfolio
Previous 2023 Outlook
Current 2023 Outlook(1)
Change at Midpoint
Number of properties/units 115 properties / 34,179 units 106 properties / 31,829 units
Property revenue growth 6.1% to 6.6% 5.5% to 5.7% (0.75)%
Controllable operating expense growth 4.7% to 5.4% 6.0% to 7.0% 1.40%
Real estate tax and insurance expense growth 7.5% to 8.1% 4.2% to 4.8% (3.30)%
Total operating expense growth 5.7% to 6.4% 5.5% to 5.9% (0.35)%
Property NOI growth 6.0% to 7.0% 5.3% to 5.7% (1.00)%
Corporate Expenses
   General and administrative & Property
    management expenses		 $50.5 million to $51.5 million $50.0 million to $51.0 million $(0.5) million
   Interest expense(2)
 $102.5 million to $103.5 million $101.0 million to $102.0 million $(1.5) million
Transaction/Investment Volume(3)
Acquisition volume None None —
Disposition volume $122 million to $127 million $122 million to $127 million —
Capital Expenditures
Recurring $20.0 million to $22.0 million $20.0 million to $21.0 million $(0.5) million
Value add & non-recurring $78.0 million to $82.0 million $83.0 million to $85.0 million $4.0 million
Development $80.0 million to $90.0 million $75.0 million to $80.0 million $(7.5) million
(1)This guidance, including the underlying assumptions, constitutes forward-looking information. Actual results could vary significantly from the projections presented. See “Forward-Looking Statements” .
(2)Interest expense includes amortization of deferred financing costs but excludes loan premium accretion, net. As a result of purchase accounting, we recorded a $72.1 million loan premium, net, related to STAR debt. This loan premium will be accreted into and reduce GAAP interest expense over the remaining term of the associated debt. However, loan premium accretion will be excluded from CFFO.
(3)Includes one asset sale that occurred in the first quarter 2023 and one property identified as held for sale as of September 30, 2023. We expect sales of the other nine properties included in the Portfolio Optimization and Deleveraging Strategy to close in 2024. Actual acquisitions and dispositions could vary significantly from our projections. We undertake no duty to update these assumptions except as required by law. See “Forward-Looking Statements”.

5

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, October 31, 2023 from the investor relations section of the IRT website at www.irtliving.com or by dialing 1.888.440.3307, access code 1963990. For those who are not available to listen to the live call, the replay will be available shortly following the live call from the investor relations section of IRT’s website until the next earnings release. A playback of the conference call can also be accessed telephonically until Tuesday, November 7, 2023 by dialing 1.800.770.2030, access code 1963990.
Supplemental Information
We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investor Relations" section.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE: IRT) is a real estate investment trust that owns and operates multifamily communities, across non-gateway U.S. markets including Atlanta, GA, Dallas, TX, Denver, CO, Columbus, OH, Indianapolis, IN, Raleigh-Durham, NC, Oklahoma City, OK, Nashville, TN, Houston, TX, and Tampa, FL. 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 aims to provide stockholders attractive risk-adjusted returns 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.
6

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 certain actions that we expect or seek to take in connection with our portfolio optimization and deleveraging strategy and anticipated enhancements to our financial results and future growth from this strategy. 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, failure to realize cost savings, efficiencies and other benefits that we expect to result from our portfolio optimization and deleveraging strategy, 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, 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, increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents 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, 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, 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, 2022, 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.









7

Schedule I
Independence Realty Trust, Inc.
Selected Financial Information
Dollars in thousands, except per share data (unaudited)

For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Selected Financial Information:
Operating Statistics:
Net income available to common shares $3,930 $10,709 $8,648 $33,631 $16,223
Earnings per share -- diluted $0.02 $0.05 $0.04 $0.15 $0.07
Rental and other property revenue $168,375 $163,601 $161,135 $162,493 $160,300
Property operating expenses $63,300 $62,071 $59,255 $57,450 $59,967
NOI $105,075 $101,530 $101,880 $105,043 $100,333
NOI margin 62.4% 62.1% 63.2% 64.6% 62.6%
Adjusted EBITDA $94,415 $89,156 $87,594 $93,017 $89,264
FFO per share $0.31 $0.28 $0.27 $0.31 $0.30
CORE FFO per share $0.30 $0.28 $0.27 $0.29 $0.28
Dividends per share $0.16 $0.16 $0.14 $0.14 $0.14
CORE FFO payout ratio 53.3% 57.1% 51.9% 48.3% 50.0%
Portfolio Data:
Total gross assets $7,225,447 $7,117,404 $7,045,306 $7,034,902 $7,097,280
Total number of operating properties (a) 120 119 119 120 122
Total units (a) 35,427 35,249 35,249 35,526 36,176
Portfolio period end occupancy (a) 94.4% 94.6% 94.1% 93.6% 94.6%
Portfolio average occupancy (a) 94.6% 94.1% 93.1% 93.9% 94.2%
Portfolio average effective monthly rent, per unit (a) $1,556 $1,538 $1,535 $1,522 $1,484
Same-store portfolio period end occupancy (b) 94.5% 94.6% 94.1% 93.6% 94.6%
Same-store portfolio average occupancy (b) 94.6% 94.2% 93.1% 93.9% 94.2%
Same-store portfolio average effective
  monthly rent, per unit (b)		 $1,549 $1,531 $1,528 $1,517 $1,484
Capitalization:
Total debt (c) $2,715,710 $2,650,805 $2,628,632 $2,631,645 $2,713,625
Common share price, period end $14.07 $18.22 $16.03 $16.86 $16.73
Market equity capitalization $3,245,135 $4,202,342 $3,694,970 $3,880,432 $3,850,365
Total market capitalization $5,960,845 $6,853,147 $6,323,602 $6,512,077 $6,563,990
Total debt/total gross assets 37.6% 37.2% 37.3% 37.4% 38.2%
Net debt to Adjusted EBITDA (d) 7.0x 7.2x 7.3x 6.9x 7.2x
Interest coverage 4.3x 4.0x 4.0x 4.0x 4.0x
Common shares and OP Units:
Shares outstanding 224,695,566 224,697,889 224,556,870 224,064,940 224,056,179
OP units outstanding 5,946,571 5,946,571 5,946,571 6,091,171 6,091,171
Common shares and OP units outstanding 230,642,137 230,644,460 230,503,441 230,156,111 230,147,350
Weighted average common shares and OP units 230,444,945 230,369,086 230,186,297 229,994,927 228,051,780
(a)Excludes our development projects (Destination at Arista and Flatirons Apartments). See definitions at the end of this release.
(b)Same-store portfolio consists of 115 properties, which represent 34,197 units.
(c)Includes indebtedness associated with real estate held for sale, as applicable.
(d)Reflects net debt to Adjusted EBITDA for each period presented, including adjustments for the timing of acquisitions and dispositions impacting quarterly EBITDA. For the five quarters ended September 30, 2023, net debt to Adjusted EBITDA excluding adjustments for these items was 7.0x, 7.2x, 7.3x, 6.9x, and 7.4x, respectively.
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Schedule II
Independence Realty Trust, Inc.
Reconciliation of Net Income (Loss) to Funds from Operations and Core Funds From Operations
(Dollars in thousands, except share and per share amounts)
(unaudited)


For the Three Months Ended September 30, For the Nine Months Ended
 September 30,
2023 2022 2023 2022
Funds From Operations (FFO):
Net income $ 3,986  $ 16,653  $ 23,847  $ 86,135 
Add-Back (Deduct):
Real estate depreciation and amortization 55,217 49,347 162,205  199,588 
Our share of real estate depreciation and amortization from
  investments in unconsolidated real estate entities		 486 1,388 1,479  1,904 
Loss on impairment (gain on sale) of real estate assets,
  net, excluding prepayment gains		 11,268 — 10,954  (94,712)
FFO $ 70,957  $ 67,388  $ 198,485  $ 192,915 
FFO per share $ 0.31  $ 0.30  $ 0.86  $ 0.85 
CORE Funds From Operations (CFFO):
FFO $ 70,957  $ 67,388  $ 198,485  $ 192,915 
Add-Back (Deduct):
Other depreciation and amortization 329 375 860  1,100 
Casualty losses (gains), net 35 (191) 866  (7,176)
Loan (premium accretion) discount amortization, net (2,747) (2,750) (8,239) (8,245)
Prepayment (gains) penalties on asset dispositions — — (670) — 
Other expense (income), net 429 (765) 663  (1,438)
Merger and integration costs — 275 —  3,477 
Restructuring costs —  —  3,213  — 
CFFO $ 69,003  $ 64,332  $ 195,178  $ 180,633 
CFFO per share $ 0.30  $ 0.28  $ 0.85  $ 0.79 
Weighted-average shares and units outstanding 230,444,945 228,051,780 230,334,398 227,933,320
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Schedule III
Independence Realty Trust Inc.
Reconciliation from Net Income (Loss) to Same-Store Net Operating Income (a)
Dollars in thousands
(unaudited)




For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Net income $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
   Other revenue (232) (354) (239) (306) (300)
   Property management expenses 7,232  6,818  6,371  6,593  5,744 
   General and administrative
     expenses		 3,660  5,910  8,154  5,739  5,625 
   Depreciation and amortization
    expense		 55,546  53,984  53,536  52,161  49,722 
   Casualty losses (gains), net 35  680  151  (1,690) (191)
   Interest expense 22,033  22,227  22,124  23,337  22,093 
   Loss on impairment (gain on sale)
    of real estate assets, net		 11,268  —  (985) (17,044) — 
   Other loss (income), net 369  72  (93) (57) (765)
   Loss (gain) from investments in
     unconsolidated real estate entities		 1,178  1,205  776  (242) 1,477 
   Merger and integration costs —  —  —  2,028  275 
   Restructuring costs —  —  3,213  —  — 
NOI $ 105,075  $ 101,530  $ 101,880  $ 105,043  $ 100,333 
Less: Non same-store portfolio NOI 4,063  3,400  3,804  4,866  3,937 
Same-store portfolio NOI $ 101,012  $ 98,130  $ 98,076  $ 100,177  $ 96,396 
(a)Same-store portfolio consists of 115 properties, which represent 34,197 units.
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Schedule IV
Independence Realty Trust, Inc.
Reconciliation of Net Income (Loss) to Adjusted EBITDA and Interest Coverage Ratio
(Dollars in thousands)
(unaudited)

 Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Net income (loss) $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
Add-Back (Deduct):
Interest expense 22,033  22,227  22,124  23,337  22,093 
Depreciation and amortization 55,546  53,984  53,536  52,161  49,722 
Casualty losses (gains), net 35  680  151  (1,690) (191)
Loss on impairment (gain on sale) of
  real estate assets, net		 11,268  —  (985) (17,044) — 
Merger and integration costs —  —  —  2,028  275 
Loss (gain) from investments in
  unconsolidated real estate entities		 1,178  1,205  776  (242) 1,477 
Other loss (income), net 369  72  (93) (57) (765)
Restructuring costs —  —  3,213  —  — 
Adjusted EBITDA $ 94,415  $ 89,156  $ 87,594  $ 93,017  $ 89,264 
INTEREST COST:
Interest expense $ 22,033  $ 22,227  $ 22,124  $ 23,337  $ 22,093 
INTEREST COVERAGE: 4.3x 4.0x 4.0x 4.0x 4.0x

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2023 2022 2023 2022
Net income (loss) $ 3,986  $ 16,653  $ 23,847  $ 86,135 
Add-Back (Deduct):
Interest expense 22,033  22,093  66,383  63,618 
Depreciation and amortization 55,546  49,722  163,066  200,688 
Casualty losses (gains), net 35  (191) 866  (7,176)
Loss on impairment (gain on sale) of
  real estate assets, net		 11,268  —  10,284  (94,712)
Merger and integration costs —  275  —  3,477 
Loss (gain) from investments in
  unconsolidated real estate entities		 1,178  1,477  3,159  2,602 
Other loss (income), net 369  (765) 348  (1,501)
Restructuring costs —  —  3,213  — 
Adjusted EBITDA $ 94,415  $ 89,264  $ 271,166  $ 253,131 
INTEREST COST:
Interest expense $ 22,033  $ 22,093  $ 66,383  $ 63,618 
INTEREST COVERAGE: 4.3x 4.0x 4.1x 4.0x
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Schedule V
Independence Realty Trust, Inc.
Definitions
Average Effective Monthly Rent per Unit
Average effective rent per unit represents the average of gross rent amounts, 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 gains on sales (losses on impairment) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses, merger and integration costs, income (loss) from investments in unconsolidated real estate entities, and restructuring costs. 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, gains or losses on sales of real estate 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, debt extinguishment costs, merger and integration costs, and restructuring 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, and believe 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.
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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.
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).
As of
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Total debt $ 2,715,710  $ 2,650,805  $ 2,628,632  $ 2,631,645  $ 2,713,625 
Less: cash and cash equivalents (17,216) (14,349) (12,448) (16,084) (23,753)
Less: loan discounts and premiums, net (50,772) (53,520) (56,256) (59,937) (63,340)
Total net debt $ 2,647,722  $ 2,582,936  $ 2,559,928  $ 2,555,624  $ 2,626,532 
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, net gains on sale of assets, merger and integration costs, and restructuring costs.
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.
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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.
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).
As of
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Total assets $ 6,577,790  $ 6,517,400  $ 6,493,747  $ 6,532,095  $ 6,633,533 
Plus: accumulated depreciation (a)
 570,966  523,446  475,001  426,097  386,606 
Plus: accumulated amortization 76,691  76,558  76,558  76,710  77,141 
Total gross assets $ 7,225,447  $ 7,117,404  $ 7,045,306  $ 7,034,902  $ 7,097,280 
(a)Includes accumulated depreciation associated with real estate held for sale, as applicable.
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EX-99.2 3 irt-20231030xsupex992.htm EX-99.2 Document

Exhibit 99.2



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NYSE: IRT
WWW.IRTLIVING.COM

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TABLE OF CONTENTS
Three and Nine Months Ended September 30, 2023 and 2022
Three and Nine Months Ended September 30, 2023 and 2022
Three and Nine Months Ended September 30, 2023 and 2022
Three Months Ended September 30, 2023 and 2022 
Nine Months Ended September 30, 2023 and 2022
Debt Maturity, Debt Covenant & Unencumbered Asset Statistics
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Independence Realty Trust
September 30, 2023
Company Information: 
Independence Realty Trust, Inc. (NYSE: IRT) is a real estate investment trust that owns and operates multifamily communities, across non-gateway U.S. markets including Atlanta, GA, Dallas, TX, Denver, CO, Columbus, OH, Indianapolis, IN, Raleigh-Durham, NC, Oklahoma City, OK, Nashville, TN, Houston, TX, and Tampa, FL. 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 aims to provide stockholders attractive risk-adjusted returns 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.
Corporate Headquarters 1835 Market Street, Suite 2601
Philadelphia, PA 19103
267.270.4800
Trading Symbol NYSE: “IRT”
Investor Relations Contact Edelman Smithfield
Ted McHugh and Lauren Torres
917-365-7979
IRT@edelman.com 
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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 certain actions that we expect or seek to take in connection with our portfolio optimization and deleveraging strategy and anticipated enhancements to our financial results and future growth from this strategy. 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, failure to realize cost savings, efficiencies and other benefits that we expect to result from our portfolio optimization and deleveraging strategy, 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, 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, increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents 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, 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, 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, 2022, 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.

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Independence Realty Trust Announces Third Quarter 2023 Financial Results
Initiates Portfolio Optimization and Deleveraging Strategy
Updates Full Year 2023 Guidance

PHILADELPHIA – (BUSINESS WIRE) – October 30, 2023 — Independence Realty Trust, Inc. (“IRT”) (NYSE: IRT), a multifamily apartment REIT, today announced its third quarter 2023 financial results, initiated its portfolio optimization strategy and updated its full year 2023 guidance.
Third Quarter Highlights
•Net income available to common shares of $3.9 million for the quarter ended September 30, 2023 compared to $16.2 million for the quarter ended September 30, 2022.
•Earnings per diluted share of $0.02 for the quarter ended September 30, 2023 compared to $0.07 for the quarter ended September 30, 2022.
•Same-store portfolio net operating income (“NOI”) growth of 4.8% for the quarter ended September 30, 2023 compared to the quarter ended September 30, 2022.
•Core Funds from Operations (“CFFO”) of $69.0 million for the quarter ended September 30, 2023 compared to $64.3 million for the quarter ended September 30, 2022. CFFO per share was $0.30 for the third quarter of 2023, as compared to $0.28 for the third quarter of 2022.
•Adjusted EBITDA of $94.4 million for the quarter ended September 30, 2023 compared to $89.3 million for the quarter ended September 30, 2022, an increase of 5.7%.
•Value add program completed renovations at 709 units during the quarter ended September 30, 2023, achieving a weighted average return on investment during the quarter of 14.2%.
Included later in this press release are definitions of NOI, CFFO, Adjusted EBITDA and other Non-GAAP financial measures and reconciliations of such measures to their most comparable financial measures as calculated and presented in accordance with GAAP.
Management Commentary
“For the third quarter of 2023, we delivered growth of 4.8% in same store NOI and 7.1% in Core FFO per share and we remain focused on delivering sustainable operational efficiencies. We are updating our full year 2023 guidance to reflect the impact of the slowing macroeconomic environment on leasing activity.” said Scott Schaeffer, Chairman and CEO of IRT. “We are also commencing a portfolio optimization and deleveraging strategy that will accelerate non-core asset sales while deleveraging our balance sheet in the near-term. We expect these initiatives will increase our financial flexibility and will reduce leverage by almost a full turn upon completion of all asset sales. We are confident that these initiatives will strengthen our balance sheet and improve our presence in the multifamily sector in 2024.”
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Same-Store Portfolio(1) Operating Results
Third Quarter 2023
 Compared to
 Third Quarter 2022
Nine Months Ended September 30, 2023 Compared to Nine Months Ended September 30, 2022
Rental and other property revenue 5.4% increase 6.3% increase
Property operating expenses 6.3% increase 6.2% increase
Net operating income (“NOI”) 4.8% increase 6.4% increase
Portfolio average occupancy 40 bps increase to 94.6% 120 bps decrease to 93.9%
Portfolio average rental rate 4.4% increase to $1,549 7.7% increase to $1,536
NOI Margin 40 bps decrease to 62.4% No change — 62.6%
(1)Same-store portfolio includes 115 properties, which represent 34,197 units.
Operating Metrics
The table below summarizes operating metrics for the same-store portfolio for the applicable periods.
3Q 2023
4Q 2023(3)
Same-Store Portfolio(1)
   Average Occupancy 94.6  % 94.3  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 0.8  % (2.3) %
        Renewal Leases 4.8  % 5.0  %
        Blended 3.0  % 2.3  %
   Resident retention rate 52.3  % 48.4  %
Same-Store Portfolio excluding Ongoing Value Add
   Average Occupancy 95.0  % 94.7  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 0.3  % (2.5) %
        Renewal Leases 4.6  % 4.8  %
        Blended 2.7  % 2.1  %
   Resident retention rate 52.6  % 47.7  %
Value Add (22 properties with Ongoing Value Add)
   Average Occupancy 92.8  % 92.8  %
(4)
   Lease Over Lease Effective Rental Rate Growth:(2)
        New Leases 2.8  % (1.6) %
        Renewal Leases 5.9  % 6.3  %
        Blended 4.5  % 3.0  %
   Resident retention rate 51.2  % 51.3  %
(1)Same-store portfolio includes 115 properties, which represent 34,197 units.
(2)Lease-over-lease effective rent growth represents the change in effective monthly rent, as adjusted for concessions, for each unit that had a prior lease and current lease that are for a term of 9-13 months.
(3)4Q 2023 average occupancy and resident retention rates are through October 28, 2023. 4Q 2023 new lease and renewal rates are for leases commencing during 4Q 2023 that were signed as of October 28, 2023.
(4)As of October 28, 2023, same-store portfolio occupancy was 94.6%, same-store portfolio excluding ongoing value add occupancy was 95.0%, and value add occupancy was 93.1%.
Portfolio Optimization and Deleveraging Strategy

We continuously evaluate opportunities for the potential disposition of properties in our portfolio by considering a variety of criteria including, but not limited to, local market conditions and lease rates, our scale within the
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markets, our view of market demographics and growth prospects and potential uses of sales proceeds. Subsequent to September 30, 2023, our Board of Directors approved a plan, which we refer to as our Portfolio Optimization and Deleveraging Strategy, to exit or reduce our presence in certain markets while also deleveraging our balance sheet. Our Portfolio Optimization and Deleveraging Strategy targets sales of approximately 10 properties that are located in seven markets, including the one property in Chicago, Illinois that was held for sale as of September 30, 2023. Nine of the 10 properties were acquired in December 2021 as part of the STAR merger. We currently expect these asset sales to generate gross sales proceeds of approximately $521 to $533 million with proceeds used to immediately delever our balance sheet.
We estimate that these asset sales, if consummated within the foregoing price range, will enable us to reduce our outstanding debt by approximately $516 to $528 million (comprised of $284 million of property level debt associated with the ten properties and $232 to $244 million of additional debt), will reduce our net debt to adjusted EBITDA ratio by 0.8x to 0.9x, and will be dilutive to Core FFO per share by $0.02-$0.03. In addition, consummation of the targeted sales would reduce our market exposures by five single asset markets and reduce the average age of the properties in our portfolio by approximately one year.
We expect to recognize an aggregate net loss after completion of all sales in the range of approximately $39 to $51 million comprised of an $11.3 million impairment charge recorded during the three months ended September 30, 2023 related to our property in Chicago, Illinois that is currently held for sale; an estimated $55 to $63 million impairment charge we expect to recognize during the fourth quarter of 2023 with respect to certain of the properties targeted for sale; and estimated gains of approximately $24 to $28 million we expect to realize in the periods of sale of certain of the properties targeted for sale.
We are in various stages of marketing, negotiations, and buyer due diligence with respect to the properties targeted for sale. There can be no assurance that any of the sales will be consummated at expected pricing levels, within expected time frames, or at all. The estimates of sale prices discussed above are based on our assessment of current conditions in the markets where the properties are located, comparable sales data, characteristics and operating performance of the properties among other factors and are subject to numerous assumptions.
Value Add Program
We completed renovations on 709 units during the quarter ended September 30, 2023, achieving a return on investment of 14.2% (and approximately 15.3% on the interior portion of such renovation costs), with an average cost per unit renovated of $17,750, and an average monthly rent increase per renovated unit of $210. For the nine months end September 30, 2023, we have completed renovations on 1,969 units, achieving a return on investment of 16.0% (and approximately 17.3% on the interior portion of such renovation costs), with an average cost per unit renovated of $16,947, and an average monthly rent increase per renovated unit of $224. See the Value Add Summary page of our supplemental for additional information on our projects life to date as of September 30, 2023.
Investment Activity
Capital Expenditures
For the three months ended September 30, 2023, recurring capital expenditures for the total portfolio were $5.3 million, or $153 per unit. For the nine months ended September 30, 2023, recurring capital expenditures for the total portfolio were $15.8 million, or $454 per unit.
Capital Markets
Dividend Distribution
On September 12, 2023, our Board of Directors declared a quarterly dividend of $0.16 per share of common stock. The third quarter dividend was paid on October 20, 2023 to stockholders of record at the close of business on September 29, 2023.
2023 EPS, FFO and CFFO Guidance
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We reduced our EPS, FFO, and CFFO per share guidance ranges and our same store NOI guidance range. Earnings (loss) per diluted share is now projected to be in the range of ($0.07) to ($0.02). A reconciliation of IRT's projected net (loss) income allocable to common shares to its projected CFFO per share is included below. See the schedules and definitions at the end of this release for further information regarding how IRT calculates CFFO and for management’s definition and rationale for the usefulness of CFFO.
Previous Guidance Current Guidance Change at Midpoint
2023 Full Year EPS and CFFO Guidance(1)(2)
 Low High Low High
Earnings (loss) per share $ 0.25  $ 0.27  $ (0.07) $ (0.02) $ (0.305)
Adjustments:
Depreciation and amortization
 0.95  0.95  0.94  0.94  (0.01)
(Gain on sale) loss on impairment of
  real estate assets(3)
 (0.01) (0.01) 0.32  0.28  0.31 
FFO per share 1.19  1.21  1.19  1.20  (0.005)
Loan (premium accretion) discount
  amortization, net		 (0.05) (0.05) (0.05) (0.05) — 
Core FFO per share $ 1.14  $ 1.16  $ 1.14  $ 1.15  $ (0.005)
(1)This guidance, including the underlying assumptions presented in the table below, constitutes forward-looking information. Actual full year 2023 EPS, FFO, and CFFO could vary significantly from the projections presented. See “Forward-Looking Statements” . Our guidance is based on the key guidance assumptions detailed below.
(2)Per share guidance is based on 230.4 million weighted average shares and units outstanding.
(3)Gain on sale (loss on impairment) of real estate assets includes gains (impairments) on one asset sale that occurred during the first quarter of 2023, one property identified as held for sale as of September 30, 2023, and nine other assets targeted for sale as part of our Portfolio Optimization and Deleveraging Strategy.
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2023 Guidance Assumptions
Our key guidance assumptions for 2023 are enumerated below. See definitions at the end of this release for further information regarding our same-store definitions.
Same-Store Portfolio
Previous 2023 Outlook
Current 2023 Outlook(1)
Change at Midpoint
Number of properties/units 115 properties / 34,179 units 106 properties / 31,829 units
Property revenue growth 6.1% to 6.6% 5.5% to 5.7% (0.75)%
Controllable operating expense growth 4.7% to 5.4% 6.0% to 7.0% 1.40%
Real estate tax and insurance expense growth 7.5% to 8.1% 4.2% to 4.8% (3.30)%
Total operating expense growth 5.7% to 6.4% 5.5% to 5.9% (0.35)%
Property NOI growth 6.0% to 7.0% 5.3% to 5.7% (1.00)%
Corporate Expenses
   General and administrative & Property
    management expenses		 $50.5 million to $51.5 million $50.0 million to $51.0 million $(0.5) million
   Interest expense(2)
 $102.5 million to $103.5 million $101.0 million to $102.0 million $(1.5) million
Transaction/Investment Volume(3)
Acquisition volume None None —
Disposition volume $122 million to $127 million $122 million to $127 million —
Capital Expenditures
Recurring $20.0 million to $22.0 million $20.0 million to $21.0 million $(0.5) million
Value add & non-recurring $78.0 million to $82.0 million $83.0 million to $85.0 million $4.0 million
Development $80.0 million to $90.0 million $75.0 million to $80.0 million $(7.5) million
(1)This guidance, including the underlying assumptions, constitutes forward-looking information. Actual results could vary significantly from the projections presented. See “Forward-Looking Statements” .
(2)Interest expense includes amortization of deferred financing costs but excludes loan premium accretion, net. As a result of purchase accounting, we recorded a $72.1 million loan premium, net, related to STAR debt. This loan premium will be accreted into and reduce GAAP interest expense over the remaining term of the associated debt. However, loan premium accretion will be excluded from CFFO.
(3)Includes one asset sale that occurred in the first quarter 2023 and one property identified as held for sale as of September 30, 2023. We expect sales of the other nine properties included in the Portfolio Optimization and Deleveraging Strategy to close in 2024. Actual acquisitions and dispositions could vary significantly from our projections. We undertake no duty to update these assumptions except as required by law. See “Forward-Looking Statements”.

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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, October 31, 2023 from the investor relations section of the IRT website at www.irtliving.com or by dialing 1.888.440.3307, access code 1963990. For those who are not available to listen to the live call, the replay will be available shortly following the live call from the investor relations section of IRT’s website until the next earnings release. A playback of the conference call can also be accessed telephonically until Tuesday, November 7, 2023 by dialing 1.800.770.2030, access code 1963990.
Supplemental Information
We produce supplemental information that includes details regarding the performance of the portfolio, financial information, non-GAAP financial measures, same-store information and other useful information for investors. The supplemental information is available via our website, www.irtliving.com, through the "Investor Relations" section.
About Independence Realty Trust, Inc.
Independence Realty Trust, Inc. (NYSE: IRT) is a real estate investment trust that owns and operates multifamily communities, across non-gateway U.S. markets including Atlanta, GA, Dallas, TX, Denver, CO, Columbus, OH, Indianapolis, IN, Raleigh-Durham, NC, Oklahoma City, OK, Nashville, TN, Houston, TX, and Tampa, FL. 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 aims to provide stockholders attractive risk-adjusted returns 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.
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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 certain actions that we expect or seek to take in connection with our portfolio optimization and deleveraging strategy and anticipated enhancements to our financial results and future growth from this strategy. 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, failure to realize cost savings, efficiencies and other benefits that we expect to result from our portfolio optimization and deleveraging strategy, 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, 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, increased regulations generally and specifically on the rental housing market, including legislation that may regulate rents 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, 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, 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, 2022, 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.









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FINANCIAL & OPERATING HIGHLIGHTS
Dollars in thousands, except per share data
For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Selected Financial Information:
Operating Statistics:
Net income available to common shares $3,930 $10,709 $8,648 $33,631 $16,223
Earnings per share -- diluted $0.02 $0.05 $0.04 $0.15 $0.07
Rental and other property revenue $168,375 $163,601 $161,135 $162,493 $160,300
Property operating expenses $63,300 $62,071 $59,255 $57,450 $59,967
NOI $105,075 $101,530 $101,880 $105,043 $100,333
NOI margin 62.4% 62.1% 63.2% 64.6% 62.6%
Adjusted EBITDA $94,415 $89,156 $87,594 $93,017 $89,264
FFO per share $0.31 $0.28 $0.27 $0.31 $0.30
CORE FFO per share $0.30 $0.28 $0.27 $0.29 $0.28
Dividends per share $0.16 $0.16 $0.14 $0.14 $0.14
CORE FFO payout ratio 53.3% 57.1% 51.9% 48.3% 50.0%
Portfolio Data:
Total gross assets $7,225,447 $7,117,404 $7,045,306 $7,034,902 $7,097,280
Total number of operating properties (a) 120 119 119 120 122
Total units (a) 35,427 35,249 35,249 35,526 36,176
Portfolio period end occupancy (a) 94.4% 94.6% 94.1% 93.6% 94.6%
Portfolio average occupancy (a) 94.6% 94.1% 93.1% 93.9% 94.2%
Portfolio average effective monthly rent, per unit (a) $1,556 $1,538 $1,535 $1,522 $1,484
Same-store portfolio period end occupancy (b) 94.5% 94.6% 94.1% 93.6% 94.6%
Same-store portfolio average occupancy (b) 94.6% 94.2% 93.1% 93.9% 94.2%
Same-store portfolio average effective
  monthly rent, per unit (b)		 $1,549 $1,531 $1,528 $1,517 $1,484
Capitalization:
Total debt (c) $2,715,710 $2,650,805 $2,628,632 $2,631,645 $2,713,625
Common share price, period end $14.07 $18.22 $16.03 $16.86 $16.73
Market equity capitalization $3,245,135 $4,202,342 $3,694,970 $3,880,432 $3,850,365
Total market capitalization $5,960,845 $6,853,147 $6,323,602 $6,512,077 $6,563,990
Total debt/total gross assets 37.6% 37.2% 37.3% 37.4% 38.2%
Net debt to Adjusted EBITDA (d) 7.0x 7.2x 7.3x 6.9x 7.2x
Interest coverage 4.3x 4.0x 4.0x 4.0x 4.0x
Common shares and OP Units:
Shares outstanding 224,695,566 224,697,889 224,556,870 224,064,940 224,056,179
OP units outstanding 5,946,571 5,946,571 5,946,571 6,091,171 6,091,171
Common shares and OP units outstanding 230,642,137 230,644,460 230,503,441 230,156,111 230,147,350
Weighted average common shares and OP units 230,444,945 230,369,086 230,186,297 229,994,927 228,051,780
(a)Excludes our development projects (Destination at Arista and Flatirons Apartments). See definitions at the end of this release.
(b)Same-store portfolio consists of 115 properties, which represent 34,197 units.
(c)Includes indebtedness associated with real estate held for sale, as applicable.
(d)Reflects net debt to Adjusted EBITDA for each period presented, including adjustments for the timing of acquisitions and dispositions impacting quarterly EBITDA. For the five quarters ended September 30, 2023, net debt to Adjusted EBITDA excluding adjustments for these items was 7.0x, 7.2x, 7.3x, 6.9x, and 7.4x, respectively.
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BALANCE SHEETS
Dollars in thousands, except per share data
As of
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Assets:
Real estate held for investment, at cost $ 6,754,022  $ 6,610,233  $ 6,648,907  $ 6,615,243  $ 6,634,087 
Less: accumulated depreciation (567,200) (519,680) (475,001) (425,034) (379,171)
Real estate held for investment, net 6,186,822  6,090,553  6,173,906  6,190,209  6,254,916 
Real estate held for sale 75,392  86,576  —  35,777  82,178 
Real estate under development 83,547  121,733  124,983  105,518  86,763 
Cash and cash equivalents 17,216  14,349  12,448  16,084  23,753 
Restricted cash 31,772  28,163  22,385  27,933  35,829 
Investment in unconsolidated real estate entities 87,592  99,968  92,882  80,220  70,608 
Other assets 41,926  31,799  34,360  34,846  34,480 
Derivative assets 53,258  44,259  32,783  41,109  43,967 
Intangible assets, net 265  —  —  399  1,039 
Total assets $ 6,577,790  $ 6,517,400  $ 6,493,747  $ 6,532,095  $ 6,633,533 
Liabilities and Equity:
Indebtedness, net $ 2,675,117  $ 2,609,903  $ 2,628,632  $ 2,631,645  $ 2,667,183 
Indebtedness associated with real estate held
  for sale, net		 40,593  40,902  —  —  46,442 
Accounts payable and accrued expenses 138,549  115,664  105,873  109,677  126,310 
Accrued interest payable 8,275  7,986  7,979  7,713  11,019 
Dividends payable 36,858  36,856  32,232  32,189  32,188 
Derivative liabilities —  —  2,283  —  — 
Other liabilities 10,642  11,172  11,813  13,004  13,816 
Total liabilities 2,910,034  2,822,483  2,788,812  2,794,228  2,896,958 
Equity:
Shareholders' Equity:
Preferred shares, $0.01 par value per share —  —  —  —  — 
Common shares, $0.01 par value per share 2,247  2,247  2,246  2,241  2,241 
Additional paid in capital 3,751,001  3,754,839  3,753,074  3,751,056  3,749,550 
Accumulated other comprehensive income 47,910  38,823  25,101  35,102  37,569 
Accumulated deficit (271,982) (239,972) (214,775) (191,735) (194,014)
Total shareholders' equity 3,529,176  3,555,937  3,565,646  3,596,664  3,595,346 
Noncontrolling Interests 138,580  138,980  139,289  141,203  141,229 
Total equity 3,667,756  3,694,917  3,704,935  3,737,867  3,736,575 
Total liabilities and equity $ 6,577,790  $ 6,517,400  $ 6,493,747  $ 6,532,095  $ 6,633,533 

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STATEMENTS OF OPERATIONS, FFO & CORE FFO
TRAILING FIVE QUARTERS
Dollars in thousands, except per share data
For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Revenue:
Rental and other property revenue $ 168,375  $ 163,601  $ 161,135  $ 162,493  $ 160,300 
Other revenue 232 354 239 306 300
Total revenue 168,607 163,955 161,374 162,799 160,600
Expenses:
Property operating expenses 63,300 62,071 59,255 57,450 59,967
Property management expenses 7,232 6,818 6,371 6,593 5,744
General and administrative expenses (a) 3,660 5,910 8,154 5,739 5,625
Depreciation and amortization expense 55,546 53,984 53,536 52,161 49,722
Casualty losses (gains), net 35 680 151 (1,690) (191)
Total expenses 129,773 129,463 127,467 120,253 120,867
Interest expense (22,033) (22,227) (22,124) (23,337) (22,093)
(Loss on impairment) gain on sale of real estate
  assets, net		 (11,268) — 985 17,044 —
Other (loss) income, net (369) (72) 93 57 765
(Loss) gain from investments in unconsolidated
  real estate entities		 (1,178) (1,205) (776) 242 (1,477)
Merger and integration costs — — — (2,028) (275)
Restructuring costs —  —  (3,213) —  — 
Net income $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
Income allocated to noncontrolling interests (56) (279) (224) (893) (430)
Net income available to common shares $ 3,930  $ 10,709  $ 8,648  $ 33,631  $ 16,223 
EPS - basic $ 0.02  $ 0.05  $ 0.04  $ 0.15  $ 0.07 
Weighted-average shares outstanding - Basic 224,498,374 224,422,515 224,226,873 223,903,756 221,960,609
EPS - diluted $ 0.02  $ 0.05  $ 0.04  $ 0.15  $ 0.07 
Weighted-average shares outstanding - Diluted 225,140,555 225,073,890 225,088,659 224,915,128 222,867,546
Funds From Operations (FFO):
Net income $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
Add-Back (Deduct):
Real estate depreciation and amortization 55,217 53,701 53,287 51,957 49,347
Our share of real estate depreciation and
  amortization from investments in unconsolidated
   real estate entities		 486 575 418 416 1,388
Loss on impairment (gain on sale) of real estate
  assets, net, excluding prepayment gains		 11,268 — (314) (16,635) —
FFO $ 70,957  $ 65,264  $ 62,263  $ 70,262  $ 67,388 
FFO per share $ 0.31  $ 0.28  $ 0.27  $ 0.31  $ 0.30 
CORE Funds From Operations (CFFO):
FFO $ 70,957  $ 65,264  $ 62,263  $ 70,262  $ 67,388 
Add-Back (Deduct):
Other depreciation and amortization 329 283 249 204 375
Casualty losses (gains), net 35 680 151 (1,690) (191)
Loan (premium accretion) discount amortization,
 net		 (2,747) (2,737) (2,755) (2,760) (2,750)
Prepayment (gains) penalties on asset dispositions — — (670) (409) —
Other expense (income), net 429 192 42 (860) (765)
Merger and integration costs — — — 2,028 275
Restructuring costs —  —  3,213  —  — 
CFFO $ 69,003  $ 63,682  $ 62,493  $ 66,775  $ 64,332 
CFFO per share $ 0.30  $ 0.28  $ 0.27  $ 0.29  $ 0.28 
Weighted-average shares and units outstanding 230,444,945 230,369,086 230,186,297 229,994,927 228,051,780
(a)Included in the three months ended March 31, 2023 is $2.7 million of stock compensation expense recorded with respect to stock awards granted during the respective period to retirement eligible employees.
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STATEMENTS OF OPERATIONS, FFO & CORE FFO
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
Dollars in thousands, except per share data
For the Three Months Ended September 30, For the Nine Months Ended
 September 30,
2023 2022 2023 2022
Revenue:
Rental and other property revenue $ 168,375  $ 160,300  $ 493,111  $ 464,921 
Other revenue 232 300 826  805 
Total revenue 168,607 160,600 493,937  465,726 
Expenses:
Property operating expenses 63,300 59,967 184,627  174,825 
Property management expenses 7,232 5,744 20,421  17,440 
General and administrative expenses 3,660 5,625 17,724  20,521 
Depreciation and amortization expense 55,546 49,722 163,066  200,688 
Casualty losses (gains), net 35 (191) 866  (7,176)
Total expenses 129,773 120,867 386,704  406,298 
Interest expense (22,033) (22,093) (66,383) (63,618)
(Loss on impairment) gain on sale of real estate
  assets, net		 (11,268) — (10,284) 94,712 
Other (loss) income, net (369) 765 (348) 1,501 
Loss from investments in unconsolidated real estate entities (1,178) (1,477) (3,158) (2,411)
Merger and integration costs — (275) —  (3,477)
Restructuring costs —  —  (3,213) — 
Net income 3,986  16,653  23,847  86,135 
Income allocated to noncontrolling interests (56) (430) (559) (2,517)
Net income available to common shares $ 3,930  $ 16,223  $ 23,288  $ 83,618 
EPS - basic $ 0.02  $ 0.07  $ 0.10  $ 0.38 
Weighted-average shares outstanding - Basic 224,498,374 221,960,609 224,383,590 221,312,261
EPS - diluted $ 0.02  $ 0.07  $ 0.10  $ 0.38 
Weighted-average shares outstanding - Diluted 225,140,555 222,867,546 225,103,475 222,359,585
Funds From Operations (FFO):
Net income $ 3,986  $ 16,653  $ 23,847  $ 86,135 
Add-Back (Deduct):
Real estate depreciation and amortization 55,217 49,347 162,205  199,588 
Our share of real estate depreciation and amortization from
  investments in unconsolidated real estate entities		 486 1,388 1,479  1,904 
Loss on impairment (gain on sale) of real estate assets,
  net, excluding prepayment gains		 11,268 — 10,954  (94,712)
FFO $ 70,957  $ 67,388  $ 198,485  $ 192,915 
FFO per share $ 0.31  $ 0.30  $ 0.86  $ 0.85 
CORE Funds From Operations (CFFO):
FFO $ 70,957  $ 67,388  $ 198,485  $ 192,915 
Add-Back (Deduct):
Other depreciation and amortization 329 375 860  1,100 
Casualty losses (gains), net 35 (191) 866  (7,176)
Loan (premium accretion) discount amortization, net (2,747) (2,750) (8,239) (8,245)
Prepayment (gains) penalties on asset dispositions — — (670) — 
Other expense (income), net 429 (765) 663  (1,438)
Merger and integration costs — 275 —  3,477 
Restructuring costs —  —  3,213  — 
CFFO $ 69,003  $ 64,332  $ 195,178  $ 180,633 
CFFO per share $ 0.30  $ 0.28  $ 0.85  $ 0.79 
Weighted-average shares and units outstanding 230,444,945 228,051,780 230,334,398 227,933,320
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ADJUSTED EBITDA RECONCILIATION AND COVERAGE RATIO
Dollars in thousands

 Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Net income (loss) $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
Add-Back (Deduct):
Interest expense 22,033  22,227  22,124  23,337  22,093 
Depreciation and amortization 55,546  53,984  53,536  52,161  49,722 
Casualty losses (gains), net 35  680  151  (1,690) (191)
Loss on impairment (gain on sale) of
  real estate assets, net		 11,268  —  (985) (17,044) — 
Merger and integration costs —  —  —  2,028  275 
Loss (gain) from investments in
  unconsolidated real estate entities		 1,178  1,205  776  (242) 1,477 
Other loss (income), net 369  72  (93) (57) (765)
Restructuring costs —  —  3,213  —  — 
Adjusted EBITDA $ 94,415  $ 89,156  $ 87,594  $ 93,017  $ 89,264 
INTEREST COST:
Interest expense $ 22,033  $ 22,227  $ 22,124  $ 23,337  $ 22,093 
INTEREST COVERAGE: 4.3x 4.0x 4.0x 4.0x 4.0x

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2023 2022 2023 2022
Net income (loss) $ 3,986  $ 16,653  $ 23,847  $ 86,135 
Add-Back (Deduct):
Interest expense 22,033  22,093  66,383  63,618 
Depreciation and amortization 55,546  49,722  163,066  200,688 
Casualty losses (gains), net 35  (191) 866  (7,176)
Loss on impairment (gain on sale) of
  real estate assets, net		 11,268  —  10,284  (94,712)
Merger and integration costs —  275  —  3,477 
Loss (gain) from investments in
  unconsolidated real estate entities		 1,178  1,477  3,159  2,602 
Other loss (income), net 369  (765) 348  (1,501)
Restructuring costs —  —  3,213  — 
Adjusted EBITDA $ 94,415  $ 89,264  $ 271,166  $ 253,131 
INTEREST COST:
Interest expense $ 22,033  $ 22,093  $ 66,383  $ 63,618 
INTEREST COVERAGE: 4.3x 4.0x 4.1x 4.0x
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SAME-STORE PORTFOLIO NET OPERATING INCOME & NOI BRIDGE (a) (b)
TRAILING FIVE QUARTERS
Dollars in thousands, except per unit data

For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Rental and other property revenue
Same-store portfolio $ 161,811  $ 158,124  $ 154,816  $ 154,919  $ 153,584 
Non same-store portfolio 6,564  5,477  6,319  7,574  6,716 
Total rental and other property revenue 168,375  163,601  161,135  162,493  160,300 
Property operating expenses
Same-store portfolio 60,799  59,994  56,740  54,742  57,188 
Non same-store portfolio 2,501  2,077  2,515  2,708  2,779 
Total property operating expenses 63,300  62,071  59,255  57,450  59,967 
NOI
Same-store portfolio 101,012  98,130  98,076  100,177  96,396 
Non same-store portfolio 4,063  3,400  3,804  4,866  3,937 
Total property NOI $ 105,075  $ 101,530  $ 101,880  $ 105,043  $ 100,333 
(a)Same-store portfolio consists of 115 properties, which represent 34,197 units.
(b)See definitions at the end of this release for a reconciliation from GAAP net income (loss) to NOI.

For the Three-Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Revenue:
Rental and other property revenue $ 161,811  $ 158,124  $ 154,816  $ 154,919  $ 153,584 
Property Operating Expenses:
Real estate taxes 19,381  19,584  19,360  19,312  18,727 
Property insurance 4,344  3,857  3,150  3,316  3,536 
Personnel expenses 12,828  12,609  11,876  12,088  12,103 
Utilities 8,165  7,523  7,888  7,812  8,021 
Repairs and maintenance 6,389  6,536  5,801  3,887  6,013 
Contract services 5,936  6,303  5,391  5,057  5,391 
Advertising expenses 2,042  1,688  1,357  1,198  1,487 
Other expenses 1,714  1,894  1,917  2,072  1,910 
Total property operating expenses 60,799  59,994  56,740  54,742  57,188 
Same-store portfolio NOI $ 101,012  $ 98,130  $ 98,076  $ 100,177  $ 96,396 
Same-store portfolio NOI margin 62.4  % 62.1  % 63.4  % 64.7  % 62.8  %
Average occupancy 94.6  % 94.2  % 93.1  % 93.9  % 94.2  %
Average effective monthly rent, per unit $ 1,549  $ 1,531  $ 1,528  $ 1,517  $ 1,484 


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SAME-STORE PORTFOLIO NET OPERATING INCOME (a)
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022
Dollars in thousands, except per unit data
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2023 2022 % change 2023 2022 % change
Revenue:      
Rental and other property revenue $ 161,811  $ 153,584  5.4  % $ 474,751  $ 446,460  6.3  %
Property Operating Expenses:
Real estate taxes 19,381  18,727  3.5  % 58,325  57,630  1.2  %
Property insurance 4,344  3,536  22.9  % 11,351  9,343  21.5  %
Personnel expenses 12,828  12,103  6.0  % 37,313  36,752  1.5  %
Utilities 8,165  8,021  1.8  % 23,576  22,419  5.2  %
Repairs and maintenance 6,389  6,013  6.3  % 18,726  16,315  14.8  %
Contract services 5,936  5,391  10.1  % 17,630  15,362  14.8  %
Advertising expenses 2,042  1,487  37.3  % 5,087  3,947  28.9  %
Other expenses 1,714  1,910  (10.3) % 5,525  5,355  3.2  %
Total property operating expenses 60,799  57,188  6.3  % 177,533  167,123  6.2  %
Same-store portfolio NOI $ 101,012  $ 96,396  4.8  % $ 297,218  $ 279,337  6.4  %
Same-store portfolio NOI margin 62.4  % 62.8  % (0.4) % 62.6  % 62.6  % —  %
Average occupancy 94.6  % 94.2  % 0.4  % 93.9  % 95.1  % (1.2) %
Average effective monthly rent,
  per unit		 $ 1,549  $ 1,484  4.4  % $ 1,536  $ 1,426  7.7  %
(a)Same-store portfolio consists of 115 properties, which represent 34,197 units.























18
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SAME-STORE PORTFOLIO NET OPERATING INCOME BY MARKET
THREE MONTHS ENDED SEPTEMBER 30, 2023
Dollars in thousands, except rent per unit
Rental and Other Property Revenue Property Operating Expenses Net Operating Income Average Occupancy Average Effective Monthly Rent per Unit
Market Number of Properties Units 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change
Atlanta, GA 13 5,180 $ 24,914  $ 23,681  5.2  % $ 9,278  $ 9,124  1.7  % $ 15,635  $ 14,554  7.4  % 92.3  % 93.5  % (1.2) % $ 1,643  $ 1,579  4.1  %
Dallas, TX 14 4,007 21,994  20,906  5.2  % 8,579  8,577  —  % 13,415  12,329  8.8  % 94.7  % 94.8  % (0.1) % 1,807  1,722  4.9  %
Denver, CO (a)
 9 2,292 12,175  11,677  4.3  % 4,263  3,737  14.1  % 7,912  7,940  (0.4) % 95.7  % 94.9  % 0.8  % 1,716  1,655  3.7  %
Columbus, OH 10 2,510 10,773  10,056  7.1  % 4,421  3,759  17.6  % 6,352  6,297  0.9  % 94.8  % 93.8  % 1.0  % 1,406  1,324  6.2  %
Raleigh - Durham, NC 6 1,690 7,977  7,461  6.9  % 2,811  2,433  15.5  % 5,166  5,028  2.7  % 95.1  % 94.1  % 1.0  % 1,551  1,462  6.1  %
Oklahoma City, OK 8 2,147 7,962  7,613  4.6  % 2,836  2,658  6.7  % 5,125  4,955  3.4  % 95.0  % 94.6  % 0.4  % 1,177  1,131  4.1  %
Houston, TX (a)
 7 1,932 8,719  8,098  7.7  % 3,888  3,721  4.5  % 4,830  4,378  10.3  % 95.7  % 93.9  % 1.8  % 1,444  1,410  2.4  %
Indianapolis, IN 7 1,979 8,370  7,791  7.4  % 3,551  3,024  17.4  % 4,819  4,767  1.1  % 94.0  % 94.6  % (0.6) % 1,366  1,281  6.6  %
Nashville, TN 4 1,412 7,079  6,742  5.0  % 2,345  2,234  5.0  % 4,734  4,507  5.0  % 95.0  % 94.9  % 0.1  % 1,633  1,565  4.3  %
Memphis, TN 4 1,383 6,327  6,193  2.2  % 2,196  2,115  3.8  % 4,130  4,077  1.3  % 93.6  % 92.0  % 1.6  % 1,521  1,520  0.1  %
Tampa-St. Petersburg, FL 4 1,104 6,247  5,703  9.5  % 2,218  2,070  7.1  % 4,029  3,633  10.9  % 95.3  % 94.1  % 1.2  % 1,827  1,719  6.3  %
Birmingham, AL 2 1,074 4,707  4,619  1.9  % 1,910  1,720  11.0  % 2,798  2,899  (3.5) % 93.4  % 93.1  % 0.3  % 1,469  1,441  1.9  %
Louisville, KY 4 1,150 4,626  4,419  4.7  % 1,844  1,884  (2.1) % 2,782  2,536  9.7  % 94.8  % 93.2  % 1.6  % 1,275  1,225  4.1  %
Huntsville, AL 3 873 4,151  4,106  1.1  % 1,469  1,331  10.4  % 2,682  2,775  (3.4) % 96.2  % 95.0  % 1.2  % 1,522  1,494  1.9  %
Lexington, KY 3 886 3,833  3,555  7.8  % 1,194  1,192  0.2  % 2,639  2,363  11.7  % 97.6  % 96.4  % 1.2  % 1,310  1,242  5.5  %
Charlotte, NC 2 480 2,645  2,524  4.8  % 726  737  (1.5) % 1,920  1,787  7.4  % 95.7  % 95.8  % (0.1) % 1,779  1,689  5.3  %
Myrtle Beach, SC - Wilmington, NC 3 628 2,733  2,632  3.8  % 890  756  17.7  % 1,843  1,876  (1.8) % 94.8  % 93.9  % 0.9  % 1,420  1,380  2.9  %
Cincinnati, OH 2 542 2,828  2,593  9.1  % 1,085  886  22.5  % 1,742  1,708  2.0  % 95.9  % 96.1  % (0.2) % 1,589  1,495  6.3  %
Greenville, SC 1 702 2,607  2,528  3.1  % 941  928  1.4  % 1,667  1,601  4.1  % 94.3  % 94.6  % (0.3) % 1,279  1,213  5.4  %
Charleston, SC 2 518 2,656  2,513  5.7  % 1,082  1,142  (5.3) % 1,574  1,370  14.9  % 95.2  % 93.9  % 1.3  % 1,678  1,572  6.7  %
Orlando, FL 1 297 1,636  1,468  11.4  % 659  610  8.0  % 977  859  13.7  % 93.2  % 91.4  % 1.8  % 1,816  1,713  6.0  %
Asheville, NC (a)
 1 252 1,170  1,097  6.7  % 334  323  3.4  % 837  773  8.3  % 96.4  % 95.9  % 0.5  % 1,553  1,423  9.1  %
San Antonio, TX 1 306 1,465  1,460  0.3  % 654  556  17.6  % 811  904  (10.3) % 96.6  % 97.1  % (0.5) % 1,480  1,495  (1.0) %
Austin, TX 1 256 1,373  1,311  4.7  % 585  667  (12.3) % 788  644  22.4  % 92.3  % 93.6  % (1.3) % 1,804  1,690  6.7  %
Norfolk, VA (a)
 1 183 1,040  1,018  2.2  % 374  342  9.4  % 666  676  (1.5) % 96.8  % 96.2  % 0.6  % 1,913  1,840  4.0  %
Fort Wayne, IN (a)
 1 222 986  967  2.0  % 329  322  2.2  % 658  646  1.9  % 94.9  % 95.8  % (0.9) % 1,428  1,392  2.6  %
Chattanooga, TN (a)
 1 192 818  853  (4.1) % 337  340  (0.9) % 481  514  (6.4) % 93.9  % 96.0  % (2.1) % 1,412  1,412  —  %
Total / Weighted
   Average		 115 34,197 $ 161,811  $ 153,584  5.4  % $ 60,799  $ 57,188  6.3  % $ 101,012  $ 96,396  4.8  % 94.6  % 94.2  % 0.4  % $ 1,549  $ 1,484  4.4  %
(a)Includes properties included in our Portfolio Optimization and Deleveraging Strategy. In the case of Denver, CO includes three properties comprised of 895 units, in aggregate, and in the case of Houston, TX includes two properties comprised of 624 units, in the aggregate.
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SAME-STORE PORTFOLIO NET OPERATING INCOME BY MARKET
NINE MONTHS ENDED SEPTEMBER 30, 2023
Dollars in thousands, except rent per unit
Rental and Other Property Revenue Property Operating Expenses Net Operating Income Average Occupancy Average Effective Monthly Rent per Unit
Market Number of Properties Units 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change 2023 2022 % Change
Atlanta, GA 13 5,180 $ 72,470  $ 69,152  4.8  % $ 27,006  $ 25,501  5.9  % $ 45,463  $ 43,649  4.2  % 92.1  % 94.3  % (2.2) % $ 1,633  $ 1,513  7.9  %
Dallas, TX 14 4,007 64,949  60,960  6.5  % 25,899  26,224  (1.2) % 39,050  34,736  12.4  % 94.2  % 95.5  % (1.3) % 1,794  1,660  8.1  %
Denver, CO (a)
 9 2,292 36,071  33,729  6.9  % 11,739  10,566  11.1  % 24,332  23,163  5.0  % 94.7  % 95.4  % (0.7) % 1,706  1,601  6.6  %
Columbus, OH 10 2,510 31,581  29,368  7.5  % 12,110  11,275  7.4  % 19,471  18,093  7.6  % 94.8  % 95.0  % (0.2) % 1,380  1,273  8.4  %
Raleigh - Durham, NC 6 1,690 23,583  21,412  10.1  % 7,971  7,271  9.6  % 15,613  14,141  10.4  % 94.3  % 95.1  % (0.8) % 1,538  1,383  11.2  %
Oklahoma City, OK 8 2,147 23,223  22,067  5.2  % 8,056  7,623  5.7  % 15,167  14,444  5.0  % 93.5  % 95.5  % (2.0) % 1,169  1,087  7.5  %
Indianapolis, IN 7 1,979 24,588  22,651  8.6  % 9,643  8,849  9.0  % 14,945  13,802  8.3  % 93.8  % 95.1  % (1.3) % 1,349  1,237  9.1  %
Houston, TX (a)
 7 1,932 25,724  24,054  6.9  % 11,988  11,424  4.9  % 13,735  12,630  8.7  % 95.2  % 94.5  % 0.7  % 1,434  1,374  4.4  %
Nashville, TN 4 1,412 20,460  19,705  3.8  % 7,075  6,742  4.9  % 13,385  12,963  3.3  % 93.1  % 95.6  % (2.5) % 1,611  1,505  7.0  %
Memphis, TN 4 1,383 18,575  17,646  5.3  % 6,240  6,019  3.7  % 12,335  11,627  6.1  % 93.8  % 93.5  % 0.3  % 1,508  1,442  4.6  %
Tampa-St. Petersburg, FL 4 1,104 18,216  16,192  12.5  % 6,833  6,119  11.7  % 11,383  10,074  13.0  % 95.0  % 94.4  % 0.6  % 1,803  1,621  11.2  %
Birmingham, AL 2 1,074 13,836  13,911  (0.5) % 5,666  5,268  7.6  % 8,171  8,642  (5.5) % 91.1  % 94.3  % (3.2) % 1,469  1,410  4.2  %
Huntsville, AL 3 873 12,250  11,941  2.6  % 4,282  3,853  11.1  % 7,968  8,088  (1.5) % 95.3  % 95.4  % (0.1) % 1,538  1,462  5.2  %
Louisville, KY 4 1,150 13,544  13,025  4.0  % 5,722  5,479  4.4  % 7,822  7,546  3.7  % 93.5  % 94.3  % (0.8) % 1,277  1,185  7.8  %
Lexington, KY 3 886 11,179  10,381  7.7  % 3,441  3,443  (0.1) % 7,739  6,938  11.5  % 96.8  % 96.3  % 0.5  % 1,285  1,201  7.0  %
Charlotte, NC 2 480 7,921  7,179  10.3  % 2,354  2,251  4.6  % 5,567  4,928  13.0  % 95.8  % 96.0  % (0.2) % 1,766  1,597  10.6  %
Myrtle Beach, SC - Wilmington, NC 3 628 8,024  7,344  9.3  % 2,508  2,259  11.0  % 5,516  5,085  8.5  % 95.0  % 95.6  % (0.6) % 1,410  1,270  11.0  %
Cincinnati, OH 2 542 8,057  7,568  6.5  % 3,042  2,444  24.5  % 5,015  5,124  (2.1) % 94.3  % 96.6  % (2.3) % 1,563  1,450  7.8  %
Greenville, SC 1 702 7,772  7,276  6.8  % 2,898  2,693  7.6  % 4,874  4,583  6.3  % 94.0  % 94.9  % (0.9) % 1,259  1,168  7.8  %
Charleston, SC 2 518 7,779  7,181  8.3  % 3,244  2,815  15.2  % 4,535  4,366  3.9  % 94.6  % 95.7  % (1.1) % 1,638  1,486  10.2  %
Orlando, FL 1 297 4,705  4,254  10.6  % 1,998  1,760  13.5  % 2,707  2,494  8.5  % 93.1  % 94.5  % (1.4) % 1,801  1,617  11.4  %
Asheville, NC (a)
 1 252 3,460  3,083  12.2  % 960  883  8.7  % 2,500  2,200  13.6  % 96.5  % 96.7  % (0.2) % 1,518  1,338  13.5  %
San Antonio, TX 1 306 4,352  4,334  0.4  % 2,001  1,815  10.2  % 2,350  2,519  (6.7) % 96.1  % 96.5  % (0.4) % 1,484  1,472  0.8  %
Austin, TX 1 256 4,041  3,849  5.0  % 1,811  1,740  4.1  % 2,230  2,109  5.7  % 91.3  % 95.6  % (4.3) % 1,786  1,620  10.2  %
Fort Wayne, IN (a)
 1 222 2,964  2,823  5.0  % 955  928  2.9  % 2,009  1,896  6.0  % 94.1  % 95.4  % (1.3) % 1,430  1,351  5.8  %
Norfolk, VA (a)
 1 183 3,049  2,893  5.4  % 1,085  918  18.2  % 1,964  1,976  (0.6) % 95.7  % 95.4  % 0.3  % 1,896  1,782  6.4  %
Chattanooga, TN (a)
 1 192 2,378  2,482  (4.2) % 1,006  961  4.7  % 1,372  1,521  (9.8) % 92.8  % 96.6  % (3.8) % 1,390  1,367  1.7  %
Total/Weighted Average 115 34,197 $ 474,751  $ 446,460  6.3  % $ 177,533  $ 167,123  6.2  % $ 297,218  $ 279,337  6.4  % 93.9  % 95.1  % (1.2) % $ 1,536  $ 1,426  7.7  %
(a)Includes properties included in our Portfolio Optimization and Deleveraging Strategy. In the case of Denver, CO includes three properties comprised of 895 units, in aggregate, and in the case of Houston, TX includes two properties comprised of 624 units, in the aggregate.
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PROPERTY PORTFOLIO (a)
NET OPERATING INCOME EXPOSURE BY MARKET
Dollars in thousands, except rent per unit
For the Three Months Ended
 September 30, 2023
Market Number of Properties Units Gross Real 
Estate 
Assets		 Period End
 Occupancy		 Average 
Effective
 Monthly Rent 
per Unit		 NOI % of NOI
Atlanta, GA 13 5,180 $ 1,086,056  92.3  % $ 1,643  $ 15,635  14.9  %
Dallas, TX 14 4,007 863,869  94.3  % 1,807  13,415  12.8  %
Denver, CO (b) (c)
 9 2,292 610,637  95.4  % 1,716  7,912  7.3  %
Columbus, OH 10 2,510 373,832  94.4  % 1,406  6,352  6.1  %
Raleigh - Durham, NC 6 1,690 255,277  95.4  % 1,551  5,166  4.9  %
Oklahoma City, OK 8 2,147 327,074  95.3  % 1,177  5,125  4.9  %
Tampa-St. Petersburg, FL 5 1,452 307,400  95.4  % 1,825  5,124  4.9  %
Nashville, TN 5 1,508 370,731  94.3  % 1,624  5,044  4.8  %
Houston, TX (c)
 7 1,932 324,821  95.3  % 1,444  4,830  4.6  %
Indianapolis, IN 7 1,979 293,011  93.7  % 1,366  4,819  4.6  %
Memphis, TN 4 1,383 162,123  92.8  % 1,521  4,130  3.9  %
Huntsville, AL (d)
 4 1,051 241,013  94.5  % 1,529  3,057  2.9  %
Birmingham, AL 2 1,074 233,604  93.7  % 1,469  2,798  2.7  %
Charlotte, NC 3 714 189,550  95.8  % 1,767  2,789  2.7  %
Louisville, KY 4 1,150 147,848  95.6  % 1,275  2,782  2.7  %
Lexington, KY 3 886 160,777  96.7  % 1,310  2,639  2.5  %
Myrtle Beach, SC - Wilmington, NC 3 628 68,543  95.8  % 1,420  1,843  1.8  %
Cincinnati, OH 2 542 123,081  95.6  % 1,589  1,742  1.7  %
Greenville, SC 1 702 124,027  93.9  % 1,279  1,667  1.6  %
Charleston, SC 2 518 81,529  94.4  % 1,678  1,574  1.5  %
Chicago, IL (e)
 1 374 79,158  93.6  % 1,847  1,282  1.2  %
Orlando, FL 1 297 50,306  96.3  % 1,816  977  0.9  %
Asheville, NC (c)
 1 252 29,349  96.4  % 1,553  837  0.8  %
San Antonio, TX 1 306 57,269  97.7  % 1,480  811  0.8  %
Austin, TX 1 256 58,568  92.9  % 1,804  788  0.8  %
Norfolk, VA (c)
 1 183 54,297  97.3  % 1,913  666  0.6  %
Fort Wayne, IN (c)
 1 222 44,506  95.5  % 1,428  658  0.6  %
Chattanooga, TN (c)
 1 192 37,336  91.1  % 1,412  481  0.5  %
Total / Weighted Average 120 35,427 $ 6,755,592  94.4  % $ 1,556  $ 104,943  100.0  %
(a)Excludes our development projects (Destination at Arista and Flatirons Apartments). See definitions at the end of this release.
(b)Includes properties in our Fort Collins, CO and Colorado Springs, CO markets.
(c)Includes properties included in our Portfolio Optimization and Deleveraging Strategy. In the case of Denver, CO includes three properties comprised of 895 units, in aggregate, and in the case of Houston, TX includes two properties comprised of 624 units, in the aggregate.
(d)Includes the Virtuoso joint venture property consolidated beginning August 1, 2023 as a result of an amendment to the joint venture agreement.
(e)Property held for sale as of September 30, 2023.

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VALUE ADD SUMMARY BY MARKET
PROJECT LIFE TO DATE AS OF SEPTEMBER 30, 2023

Renovation Costs per Unit (b)
Market Total Properties Total
Units To Be Renovated		 Units Complete Units
Leased		  Rent Premium (a) % Rent Increase  Interior  Exterior  Total ROI - Interior Costs(c) ROI - Total Costs (d)
Ongoing
Memphis, TN 1 362  265  271  $ 373  34.1  % $ 15,281  $ 807  $ 16,088  29.3  % 27.8  %
Indianapolis, IN 1 236  167  168  254  23.4  % 15,451  805  16,256  19.7  % 18.7  %
Raleigh-Durham, NC 1 318  213  214  192  15.2  % 15,648  1,046  16,694  14.7  % 13.8  %
Tampa-St. Petersburg, FL 2 612  315  325  362  24.7  % 15,922  943  16,865  27.2  % 25.7  %
Atlanta, GA (e)
 5 2,180  1,220  1,238  238  19.2  % 14,839  1,235  16,074  19.3  % 17.8  %
Austin, TX 1 256  139  135  219  14.7  % 17,466  1,104  18,570  15.0  % 14.1  %
Oklahoma City, OK 3 793  386  386  137  15.9  % 17,180  1,025  18,205  9.6  % 9.0  %
Columbus, OH 3 786  300  295  270  21.8  % 14,045  880  14,925  23.1  % 21.7  %
Dallas, TX 4 1,199  400  394  279  19.4  % 18,905  1,879  20,784  17.7  % 16.1  %
Nashville, TN 1 724  213  203  151  10.7  % 16,199  1,664  17,863  11.2  % 10.1  %
   Total / Weighted Average 22 7,466  3,618  3,629  $ 248  20.0  % $15,856 $ 1,250  $ 17,106  20.0  % 18.7  %
Future (f)
Atlanta, GA 1  180  —  —  —  —  —  —  —  —  — 
Oklahoma City, OK 1  294  —  —  —  —  —  —  —  —  — 
   Total / Weighted Average 2  474  —  —  —  —  —  —  —  —  — 
Completed (g)
Wilmington, NC 1  288  288  287  $ 72  7.2  % $ 8,076  $ 56  $ 8,132  10.8  % 10.7  %
Raleigh-Durham, NC 1  328  325  323  184  18.0  % 14,648  2,108  16,756  15.1  % 13.2  %
Louisville, KY 2  728  717  771  212  23.8  % 15,445  2,173  17,618  16.5  % 14.5  %
Memphis, TN 2  691  638  639  189  18.7  % 11,659  974  12,633  19.5  % 18.0  %
Atlanta, GA 1  494  455  454  176  17.5  % 9,122  1,773  10,895  23.1  % 19.3  %
Columbus, OH 3  763  690  685  204  22.5  % 10,142  666  10,808  24.1  % 22.7  %
Tampa-St. Petersburg, FL 2  624  554  553  226  19.2  % 13,220  1,482  14,702  20.5  % 18.4  %
   Total / Weighted Average 12  3,916  3,667  3,712  $ 191  19.5  % $ 12,018  $ 1,346  $ 13,364  19.2  % 17.2  %
Grand Total/Weighted Average 36  11,856  7,285  7,341  $ 213  19.7  % $ 13,927  $ 1,262  $ 15,189  19.5  % 17.9  %
(a) The rent premium reflects the per unit per month difference between the rental rate on the renovated unit 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.
(b)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.
(c)Calculated using the rent premium per unit per month, multiplied by 12, divided by the interior renovation costs per unit.
(d)Calculated using the rent premium per unit per month, multiplied by 12, divided by the total renovation costs per unit.
(e)During the three months ended September 30, 2023, we paused renovations at one property comprised of 496 units in Atlanta, Georgia given current market conditions.
(f)Renovation projects expected to commence during the first half of 2024.
(g)We consider value add projects completed when over 85% of the property’s units to be renovated have been completed. We continue to renovate remaining unrenovated units as leases expire until we complete 100% of the property’s units.
(h)Includes Meadows, Haverford, Crestmont and Creekside that were formerly a part of the value add program but were sold in October 2022 (with respect to Meadows), February 2022 (with respect to Haverford) and December 2021 (with respect to Crestmont and Creekside).
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INVESTMENT AND DEVELOPMENT ACTIVITY
Dollars in thousands except per unit amounts
2023 DISPOSITIONS
Property Location Units Disposition Date Sale Price Price per Unit Average Rent Per Unit at Disposition Gain on Sale of Real Estate, Net
Eagle Lake Landing Indianapolis, IN 277 February 28, 2023 $ 37,300  $ 135  $ 1,184  $ 985 
ASSETS HELD FOR SALE AS OF SEPTEMBER 30, 2023
Property Location Units
The Meadows at River Run Chicago, Illinois 374

REAL ESTATE UNDER DEVELOPMENT
Development
Destination at Arista (a)
 Flatirons Apartments
Location Denver, Colorado Denver, Colorado
Planned Units 325 296
Start Date 3Q 2021 4Q 2022
Projected Initial Occupancy 2Q 2023 4Q 2024
Projected Completion Date 4Q 2023 4Q 2024
Projected Stabilization date 1Q 2025 1Q 2026
Total Estimated Development Costs $102,800 $119,800
Total Development Costs through September 30, 2023 $107,143 $53,924
% of Development Costs Left to Fund 2% 56%
Real Estate Under Development at September 30, 2023 $29,623 $53,924
% of Planned Units Delivered as of October 27, 2023 73.5% N/A
Leased % as of October 27, 2023 (b)
 38.9% N/A
Occupancy % as of October 27, 2023 (b)
 38.1% N/A
(a)During the nine months ended September 30, 2023, we obtained certificates of occupancy for three of the four residential buildings containing 239 units and certain common area buildings resulting in $77,520 being reclassified from real estate under development to real estate held for investment.
(b)Leased % and occupancy % are calculated using the leased or occupied units, as applicable, divided by the number of delivered units.
INVESTMENTS IN UNCONSOLIDATED REAL ESTATE ENTITIES (a)
Property Location Units Estimated Delivery Date Total Construction Budget Total Project Debt IRT Equity Interest in JV Remaining Expected IRT Investment Carrying Value of IRT’s Investment
Metropolis at Innsbrook (b)
 Richmond, VA 402  — $ 85,883  $ 64,000  84.8  % $ —  $ 17,576 
Views of Music City II /
  The Crockett (c)
 Nashville, TN 408  Q3 2023 66,079  43,275  50.0  % —  11,632 
Lakeline Station Austin, TX 378  Q3 2024 109,524  76,500  90.0  % —  31,585 
The Mustang Dallas, TX 275  Q4 2024 109,583  79,447  85.0  % —  26,799 
Total 1,463  $ 371,069  $ 263,222  $ —  $ 87,592 
(a)Virtuoso was a former unconsolidated real estate entity that consists of 178 units in Huntsville, Alabama. We reassessed the accounting for Virtuoso upon an amendment to the joint venture agreement on August 1, 2023, and concluded that it is a voting interest entity and that we now control the major decisions that most significantly impact the joint venture through our 90% voting interest. Therefore, we began consolidating the assets and liabilities of the property and its operating results effective August 1, 2023.
(b)Operations commenced during Q2 2023 with 172 units placed in service. The remaining 230 units were placed in service during Q3 2023.
(c)Views of Music City phase II had 121 units placed in service during Q3 2023 and became an operating property consisting of 209 total units as of October 2, 2023. The Crockett is an operating property consisting of 199 units delivered in Q1 2023. We have one year from their respective delivery dates to exercise our purchase options on The Crockett and Views of Music City phase II.
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DEBT SUMMARY AS OF SEPTEMBER 30, 2023
Dollars in thousands
Amount
Weighted Average Rate (d)
 Type
Weighted Average Maturity (in years)
Debt:
Unsecured revolver (a)
 $ 241,479  6.6  % Floating 2.3
Unsecured term loans (b)
 600,000  6.5  % Floating 3.8
Secured credit facilities (c)
 617,114  4.3  % Floating/Fixed 5.2
Mortgages 1,218,462  4.0  % Fixed 4.4
Total Principal 2,677,055  4.9  % 4.3
Loan premiums (discounts), net 50,772 
Unamortized deferred financing costs (12,117)
Total Consolidated Debt 2,715,710 
Market Equity Capitalization, at period end 3,245,135 
Total Capitalization $ 5,960,845 
(a)Unsecured revolver total capacity is $500,000, of which $241,478 was drawn as of September 30, 2023. The maturity date of borrowings under the unsecured revolver is January 31, 2026.
(b)Consists of a (i) $200,000 unsecured term loan with a maturity date of May 18, 2026 and a (ii) $400,000 unsecured term loan with a maturity date of January 28, 2028.
(c)Consists of a (i) $540,867 secured credit facility, three tranches of which, in an aggregate principal amount of $500,399, have a maturity date of August 1, 2028 and the fourth tranche of which, in the principal amount of $40,468, has a maturity date of March 1, 2030 and a (ii) $76,248 secured credit facility with a maturity date of July 1, 2030.
(d)Represents the weighted average of the contractual interest rates in effect as of quarter-end without regard to any interest rate swaps or collars. Our total weighted average effective interest rate during the quarter ended September 30, 2023, after giving effect to the impact of interest rate swaps and collars, and excluding the impact of loan premium amortization, discount accretion, and interest capitalization was 4.2%.
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(e)As of September 30, 2023, we maintained the below hedges that have effectively fixed a portion of our floating rates debt.
Hedges: Notional Start End Swap Rate Floor Rate Cap Rate
Collar $ 100,000  11/17/2017 11/17/2024 —  1.25  % 2.00  %
Collar $ 150,000  10/17/2018 1/17/2024 —  2.25  % 2.50  %
Swap $ 150,000  6/17/2021 6/17/2026 2.18  % —  — 
Swap $ 150,000  5/17/2022 5/17/2027 0.99  % —  — 
Swap $ 200,000  3/17/2023 3/17/2030 3.39  % —  — 
Forward starting collar $ 100,000  1/17/2024 1/17/2028 —  1.50  % 2.50  %
Forward starting collar $ 100,000  11/17/2024 1/17/2028 —  1.50  % 2.50  %
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DEBT MATURITY, DEBT COVENANT AND UNENCUMBERED ASSET STATS
AS OF SEPTEMBER 30, 2023
Dollars in thousands


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(a)Debt maturity schedule reflects actual as of September 30, 2023 and proforma maturities upon completion of our Portfolio Optimization and Deleveraging Strategy.
Debt Covenant Summary (b)
Requirement Actual Compliance
Consolidated leverage ratio ≤ 60% 36.3% Yes
Consolidated fixed charge coverage ratio ≥ 1.5x 2.68x Yes
Unsecured leverage ratio ≤ 60% 26.4% Yes
(b)For a complete listing of all debt covenants along with definitions of each covenant calculation see the Fourth Amended, Restated and Consolidated Credit Agreement, which is included as exhibit 10.1 of the Form 8-K filed on July 27, 2022.
Encumbered & Unencumbered Statistics (c)
Total Units % of Total Gross Assets % of Total Q3 2023 NOI % of Total
Unencumbered assets 18,164  51.3  % $ 3,537,086  49.0  % $ 53,775  51.2  %
Encumbered assets 17,263  48.7  % 3,688,361  51.0  % 51,168  48.8  %
35,427  100.0  % $ 7,225,447  100.0  % $ 104,943  100.0  %
(c)Upon completion of our Portfolio Optimization and Deleveraging Strategy, we expect unencumbered assets to represent approximately 54.8% of our total units, 52.8% of our gross assets, and 54.9% of our total NOI.

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DEFINITIONS
Average Effective Monthly Rent per Unit
Average effective rent per unit represents the average of gross rent amounts, 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 gains on sales (losses on impairment) of real estate, debt extinguishments and acquisition related debt extinguishment expenses, casualty (gains) losses, merger and integration costs, income (loss) from investments in unconsolidated real estate entities, and restructuring costs. 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, gains or losses on sales of real estate 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, debt extinguishment costs, merger and integration costs, and restructuring 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, and believe 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.
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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.
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).
As of
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Total debt $ 2,715,710  $ 2,650,805  $ 2,628,632  $ 2,631,645  $ 2,713,625 
Less: cash and cash equivalents (17,216) (14,349) (12,448) (16,084) (23,753)
Less: loan discounts and premiums, net (50,772) (53,520) (56,256) (59,937) (63,340)
Total net debt $ 2,647,722  $ 2,582,936  $ 2,559,928  $ 2,555,624  $ 2,626,532 
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, net gains on sale of assets, merger and integration costs, and restructuring costs.
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.

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A reconciliation from GAAP net income to NOI is provided below (dollars in thousands):

For the Three Months Ended
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Net income $ 3,986  $ 10,988  $ 8,872  $ 34,524  $ 16,653 
   Other revenue (232) (354) (239) (306) (300)
   Property management expenses 7,232  6,818  6,371  6,593  5,744 
   General and administrative
     expenses		 3,660  5,910  8,154  5,739  5,625 
   Depreciation and amortization
    expense		 55,546  53,984  53,536  52,161  49,722 
   Casualty losses (gains), net 35  680  151  (1,690) (191)
   Interest expense 22,033  22,227  22,124  23,337  22,093 
   Loss on impairment (gain on sale)
    of real estate assets, net		 11,268  —  (985) (17,044) — 
   Other loss (income), net 369  72  (93) (57) (765)
   Loss (gain) from investments in
     unconsolidated real estate entities		 1,178  1,205  776  (242) 1,477 
   Merger and integration costs —  —  —  2,028  275 
   Restructuring costs —  —  3,213  —  — 
NOI $ 105,075  $ 101,530  $ 101,880  $ 105,043  $ 100,333 
Less: Non same-store portfolio NOI 4,063  3,400  3,804  4,866  3,937 
Same-store portfolio NOI $ 101,012  $ 98,130  $ 98,076  $ 100,177  $ 96,396 
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.
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).
As of
Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022
Total assets $ 6,577,790  $ 6,517,400  $ 6,493,747  $ 6,532,095  $ 6,633,533 
Plus: accumulated depreciation (a)
 570,966  523,446  475,001  426,097  386,606 
Plus: accumulated amortization 76,691  76,558  76,558  76,710  77,141 
Total gross assets $ 7,225,447  $ 7,117,404  $ 7,045,306  $ 7,034,902  $ 7,097,280 
(a)Includes accumulated depreciation associated with real estate held for sale, as applicable.
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