UDR's Q2 FFOA & Revenues Beat Estimates, Same-Store NOI Grows

UDR Inc. UDR reported second-quarter 2025 funds from operations as adjusted (FFOA) per share of 64 cents, outpacing the Zacks Consensus Estimate of 62 cents. This also compares favorably with the prior-year quarter’s reported figure of 62 cents.

Results reflect year-over-year growth in same-store net operating income (NOI), led by a higher effective blended lease rate. The company also raised its 2025 FFOA per share guidance.

Quarterly revenues from rental income were $423.0 million, which surpassed the Zacks Consensus Estimate of $422.2 million. Total revenues came in at $425.4 million. On a year-over-year basis, rental income and total revenues rose more than 2% each.

Per Tom Toomey, “A resilient employment market, continued personal income growth, favorable relative affordability for apartments, and our operating competitive advantages led to strong results for the first half of 2025 that exceeded expectations.”

UDR’s Second Quarter in Detail

In the reported quarter, same-store revenues increased 2.5% year over year. Same-store expenses were up 1.7%. As a result, same-store NOI improved 2.9%.

UDR registered the same-store effective blended lease rate growth of 2.8% during the quarter.

The residential REIT’s weighted average same-store physical occupancy of 96.9% increased 10 basis points (bps) year over year but decreased 30 bps sequentially. Our estimate was pegged at 97%.

UDR’s Balance Sheet Position

As of June 30, 2025, UDR had $1.1 billion of liquidity through a combination of cash and undrawn capacity on its credit facilities.

Total debt was $5.8 billion as of the same date, with only $531.8 million, or 9.6% of total consolidated debt, maturing through 2026. In addition, net debt-to-EBITDAre of 5.5X in the second quarter decreased from 5.7X at the end of the prior quarter.

UDR ended the quarter with a weighted average interest rate of 3.35% and a weighted average years to maturity of 4.7 years.

UDR’s Portfolio Activity

In the second quarter, UDR acquired the developer’s equity interest and consolidated Broadridge, formerly known as 1300 Fairmount, a 478-unit apartment community in Philadelphia, PA.

2025 Guidance by UDR

The company guided for the third quarter and raised its full-year 2025 FFOA per share at the midpoint.

It expects third-quarter 2025 FFOA per share in the range of 62-64 cents. The Zacks Consensus Estimate is currently pegged at 63 cents.

For 2025, FFOA per share is expected in the range of $2.49-$2.55, with the midpoint at $2.52, up from $2.50 guided earlier. The Zacks Consensus Estimate is currently pegged at $2.50, within the guided range.

For the full year, on a straight-line basis, the company projects growth rates for same-store revenues in the range of 1.75-3.25%, same-store expenses between 2.50% and 3.50% and same-store NOI between 1.50% and 3.00%.

UDR’s Zacks Rank

Currently, UDR carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Performance of Other Residential REITs

Essex Property Trust Inc. ESS reported a second-quarter 2025 core FFO per share of $4.03, beating the Zacks Consensus Estimate of $3.99. The figure also improved 2.3% from the year-ago quarter.

The quarterly results reflected favorable growth in same-property revenues and NOI. However, same-property operating expenses partly acted as a dampener.

Invitation Home INVH reported a second-quarter 2025 FFO per share of 48 cents, in line with the Zacks Consensus Estimate. The figure also improved by a cent from the year-ago quarter.

Results reflected higher same-store NOI and same-store blended rent. However, lower occupancy marred the performance to an extent.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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This article originally published on Zacks Investment Research (zacks.com).

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