INVH Invitation Homes Inc

Invitation Homes Inc. (NYSE: INVH) (“Invitation Homes” or the “Company”), the nation’s premier single-family home leasing and management company, today announced its First Quarter 2024 financial and operating results.

First Quarter 2024 Highlights

• Year over year, total revenues increased 9.5% to $646 million, property operating and maintenance costs increased 10.5% to $230 million, net income available to common stockholders increased 18.4% to $142 million, and net income per diluted common share increased 18.2% to $0.23.
• Year over year, Core FFO per share increased 5.7% to $0.47 and AFFO per share increased 6.8% to $0.41.
• Same Store NOI increased 4.7% year over year on 5.6% Same Store Core Revenues growth and 7.4% Same Store Core Operating Expenses growth.
• Same Store Bad Debt was 1.0% of gross rental revenue, representing four consecutive quarters of improvement and a year over year improvement of approximately 80 basis points.
• Same Store Average Occupancy was 97.6%, down 20 basis points year over year and up 50 basis points from the prior quarter.
• Same Store renewal rent growth of 5.8% and Same Store new lease rent growth of 0.8% drove Same Store blended rent growth of 4.4%.
• Acquisitions by the Company and the Company's joint ventures totaled 273 homes for approximately $96 million while dispositions totaled 399 homes for approximately $157 million.
• As previously announced in January 2024, the Company began providing professional property and asset management services to portfolio owners of single-family homes for lease. This was launched through an inaugural agreement with a third-party portfolio owner that brought over 14,000 single-family homes onto the Company’s industry-leading management platform.
• In March 2024, the Company entered into a third-party agreement to provide property and asset management services for a portfolio of approximately 3,000 single-family homes for lease, which is expected to commence May 15, 2024.

Subsequent to quarter end and concurrent with this earnings release, the Company announced it has entered into a new joint venture agreement whereby Invitation Homes has made a $37.5 million investment, representing a 7.2% ownership interest, in a portfolio of approximately 3,700 single-family homes for lease. The Company also expects to provide property and asset management services to those homes and an additional 700 homes beginning in the third quarter of 2024.

Comments from Chief Executive Officer Dallas Tanner

“We’re pleased to start 2024 with strong operating results and execution on our growth strategy. This includes first quarter Same Store average occupancy of 97.6%, net operating income growth of 4.7%, blended lease rate growth of 4.4%, and a substantial improvement in bad debt year over year. As the nation’s premier single-family home leasing and management company, the rapid growth of our third-party management business is attributable to the high value of our platform, scale, and people. I’d like to thank our associates for their hard work in making this a seamless transition to date, as well as extend my appreciation to all of our esteemed partners for putting their trust in us. We look forward to working with them and continuing to forge new relationships with those who desire our industry-leading management experience.”

Glossary & Reconciliations of Non-GAAP Financial and Other Operating Measures

Financial and operating measures found in the Earnings Release and Supplemental Information include certain measures used by Invitation Homes management that are measures not defined under accounting principles generally accepted in the United States (“GAAP”). These measures are defined herein and, as applicable, reconciled to the most comparable GAAP measures.

Financial Results

Net Income, FFO, Core FFO, and AFFO Per Share — Diluted

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q1 2023

 

 

Net income

 

$ 0.23

 

$ 0.20

 

 

FFO

 

0.43

 

0.42

 

 

Core FFO

 

0.47

 

0.44

 

 

AFFO

 

0.41

 

0.38

 

 

 

 

 

 

 

 

 

Net Income

Year over year, net income per common share — diluted for Q1 2024 increased 18.2% to $0.23, primarily due to an increase in gain on sale of property, net of tax.

Core FFO

Year over year, Core FFO per share for Q1 2024 increased 5.7% to $0.47, primarily due to NOI growth.

AFFO

Year over year, AFFO per share for Q1 2024 increased 6.8% to $0.41, primarily due to the increase in Core FFO per share described above.

Operating Results

Same Store Operating Results Snapshot

 

 

 

 

 

 

Number of homes in Same Store Portfolio:

 

78,487

 

 

 

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q1 2023

 

Core Revenues growth (year over year)

 

5.6

%

 

 

 

Core Operating Expenses growth (year over year)

 

7.4

%

 

 

 

NOI growth (year over year)

 

4.7

%

 

 

 

 

 

 

 

 

 

Average Occupancy

 

97.6

%

 

97.8

%

 

Bad Debt % of gross rental revenue

 

1.0

%

 

1.8

%

 

Turnover Rate

 

5.2

%

 

5.2

%

 

 

 

 

 

 

 

Rental Rate Growth (lease-over-lease):

 

 

 

 

 

Renewals

 

5.8

%

 

7.8

%

 

New Leases

 

0.8

%

 

5.3

%

 

Blended

 

4.4

%

 

7.1

%

 

 

 

 

 

 

 

Same Store NOI

For the Same Store Portfolio of 78,487 homes, Same Store NOI for Q1 2024 increased 4.7% year over year on Same Store Core Revenues growth of 5.6% and Same Store Core Operating Expenses growth of 7.4%.

Same Store Core Revenues

Same Store Core Revenues growth for Q1 2024 of 5.6% year over year was primarily driven by a 4.6% increase in Average Monthly Rent, an 80 basis point year over year improvement in Bad Debt as a percentage of gross rental revenue, and a 15.9% increase in other income, net of resident recoveries, partially offset by a 20 basis point year over year decline in Average Occupancy.

Same Store Core Operating Expenses

Same Store Core Operating Expenses for Q1 2024 increased 7.4% year over year, primarily attributable to an 11.8% increase in fixed expenses that was partially offset by a 0.5% decrease in controllable expenses. The 11.8% increase in fixed expenses was primarily attributable to property taxes expense, which for Q1 2024 increased 11.6% year over year. As previously disclosed, due to the underaccrual of property taxes expense in the first three quarters of 2023, and the associated catch up in Q4 2023, the Company expects property taxes expense growth for the first three quarters of 2024 to be elevated, prior to normalizing in Q4 2024 to result in the Company’s expected guidance range for FY 2024 property taxes expense growth of 8% to 10%.

Investment and Property Management Activity

Acquisitions for Q1 2024 totaled 273 homes for approximately $96 million through the Company's various acquisition channels. This included 257 wholly owned homes for approximately $91 million in addition to 16 homes for approximately $5 million in the Company's joint ventures. Dispositions for Q1 2024 included 379 wholly owned homes for gross proceeds of approximately $148 million and 20 homes for gross proceeds of approximately $9 million in the Company's joint ventures.

As previously announced in January 2024, the Company began providing professional property and asset management services to portfolio owners of single-family homes for lease. This was launched through an inaugural agreement with a third-party portfolio owner that brought over 14,000 single-family homes onto the Company’s industry-leading management platform.

In March 2024, the Company entered into a third-party agreement to provide property and asset management services for a portfolio of approximately 3,000 single-family homes for lease, which is expected to commence May 15, 2024.

Subsequent to quarter end and concurrent with this earnings release, the Company announced it has entered into a new joint venture agreement whereby Invitation Homes has made a $37.5 million investment, representing a 7.2% ownership interest, in a portfolio of approximately 3,700 single-family homes for lease. The Company also expects to provide property and asset management services to those homes and an additional 700 homes beginning in the third quarter of 2024.

A summary of the Company’s owned and/or managed homes is included in the following table:

Summary of Homes Owned and/or Managed As Of 3/31/2024

 

 

 

 

 

 

 

 

 

 

 

 

Number of Homes Owned and/or Managed as of 12/31/2023

 

Acquired or Added In Q1 2024

 

Disposed or Subtracted In Q1 2024

 

Number of Homes Owned and/or Managed as of 3/31/2024

 

Wholly owned homes

 

84,567

 

257

 

(379)

 

84,445

 

Joint venture owned homes

 

3,848

 

16

 

(20)

 

3,844

 

Managed-only homes

 

—

 

14,278

 

—

 

14,278

 

Total homes owned and/or managed (1)

 

88,415

 

14,551

 

(399)

 

102,567

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

These figures exclude the additional 7,400 homes described in more detail in the narrative above, as the management contracts for these homes had not yet commenced as of March 31, 2024.

Balance Sheet and Capital Markets Activity

As of March 31, 2024, the Company had $1,738 million in available liquidity through a combination of unrestricted cash and undrawn capacity on its revolving credit facility. The Company's total indebtedness as of March 31, 2024 was $8,607 million, consisting of $6,575 million of unsecured debt and $2,032 million of secured debt. Net debt / TTM adjusted EBITDAre was 5.4x at March 31, 2024, down from 5.5x as of December 31, 2023. The Company has no debt reaching final maturity until 2026, and in addition, 99.5% of its total debt was fixed rate or swapped to fixed rate and 83.6% of its wholly owned homes were unencumbered as of March 31, 2024.

Subsequent to quarter end and as previously announced on April 29, 2024, the Company’s issuer and issue-level credit ratings were upgraded by Moody’s Investors Service to ‘Baa2’ from ‘Baa3’ with a Stable outlook.

FY 2024 Guidance Details

The Company does not provide guidance for the most comparable GAAP financial measures of net income (loss), total revenues, and property operating and maintenance expense. Additionally, a reconciliation of the forward-looking non-GAAP financial measures of Core FFO per share, AFFO per share, Same Store Core Revenues growth, Same Store Core Operating Expenses growth, and Same Store NOI growth to the comparable GAAP financial measures cannot be provided without unreasonable effort because the Company is unable to reasonably predict certain items contained in the GAAP measures, including non-recurring and infrequent items that are not indicative of the Company's ongoing operations. Such items include, but are not limited to, impairment on depreciated real estate assets, net (gain)/loss on sale of previously depreciated real estate assets, share-based compensation, casualty loss, non-Same Store revenues, and non-Same Store operating expenses. These items are uncertain, depend on various factors, and could have a material impact on the Company's GAAP results for the guidance period.

Full year 2024 guidance remains unchanged from initial guidance provided in February 2024, as outlined in the table below.

FY 2024 Guidance

 

 

 

 

 

 

 

FY 2024 Guidance Ranges

 

 

Core FFO per share — diluted

 

$1.82 to $1.90

 

 

AFFO per share — diluted

 

$1.54 to $1.62

 

 

 

 

 

 

 

Same Store Core Revenues growth (1)

 

4.5% to 5.5%

 

 

Same Store Core Operating Expenses growth (2)

 

5.5% to 7.0%

 

 

Same Store NOI growth

 

3.5% to 5.5%

 

 

 

 

 

 

 

Wholly owned acquisitions

 

$600 million to $1,000 million

 

 

JV acquisitions

 

$100 million to $300 million

 

 

Wholly owned dispositions

 

$400 million to $600 million

 

 

 

 

 

 

 

(1)

Guidance assumes FY 2024 Average Occupancy is a similar result to FY 2023. Guidance assumes average Bad Debt for FY 2024 in a range of 65 to 95 basis points.

(2)

Guidance assumes FY 2024 property tax expense growth in a range of 8% to 10% year over year and FY 2024 insurance expense growth in the mid- to high teens, which has not been updated at this time to reflect the benefit of the Company’s recently completed annual insurance policy renewal that implies FY 2024 insurance expense growth of approximately 7.5% year over year.

Earnings Conference Call Information

Invitation Homes has scheduled a conference call at 11:00 a.m. Eastern Time on May 1, 2024, to discuss results for the first quarter of 2024. The domestic dial-in number is 1-888-330-2384, and the international dial-in number is 1-240-789-2701. The conference ID is 7714113. A live audio webcast may be accessed at www.invh.com. A replay of the call will be available through May 31, 2024, and can be accessed by calling 1-800-770-2030 (domestic) or 1-609-800-9909 (international) and using the playback ID 7714113, or by using the link at www.invh.com.

Supplemental Information

The full text of the Earnings Release and Supplemental Information referenced in this release are available on Invitation Homes' Investor Relations website at www.invh.com.

About Invitation Homes

Invitation Homes, an S&P 500 company, is the nation's premier single-family home leasing and management company, meeting changing lifestyle demands by providing access to high-quality, updated homes with valued features such as close proximity to jobs and access to good schools. The company's mission, “Together with you, we make a house a home,” reflects its commitment to providing homes where individuals and families can thrive and high-touch service that continuously enhances residents' living experiences.

Forward-Looking Statements

This press release contains 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 (the “Exchange Act”), which include, but are not limited to, statements related to the Company's expectations regarding the performance of the Company's business, its financial results, its liquidity and capital resources, and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “guidance,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks inherent to the single-family rental industry and the Company's business model, macroeconomic factors beyond the Company's control, competition in identifying and acquiring properties, competition in the leasing market for quality residents, increasing property taxes, homeowners’ association and insurance costs, poor resident selection and defaults and non-renewals by the Company's residents, the Company's dependence on third parties for key services, risks related to the evaluation of properties, performance of the Company's information technology systems, risks related to the Company's indebtedness, and risks related to the potential negative impact of unfavorable global and United States economic conditions (including inflation and rising interest rates), uncertainty in financial markets (including as a result of events affecting financial institutions), geopolitical tensions, natural disasters, climate change, and public health crises, on the Company’s financial condition, results of operations, cash flows, business, associates, and residents. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. The Company believes these factors include, but are not limited to, those described under Part I. Item 1A. “Risk Factors” of its Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report”), as such factors may be updated from time to time in the Company's periodic filings with the Securities and Exchange Commission (the “SEC”), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release, in the Annual Report, and in the Company's other periodic filings. The forward-looking statements speak only as of the date of this press release, and the Company expressly disclaims any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except to the extent otherwise required by law.

Consolidated Balance Sheets

($ in thousands, except shares and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2024

 

December 31, 2023

 

 

 

(unaudited)

 

 

 

Assets:

 

 

 

 

 

Investments in single-family residential properties, net

 

$

17,186,871

 

 

$

17,289,214

 

 

Cash and cash equivalents

 

 

738,125

 

 

 

700,618

 

 

Restricted cash

 

 

209,281

 

 

 

196,866

 

 

Goodwill

 

 

258,207

 

 

 

258,207

 

 

Investments in unconsolidated joint ventures

 

 

238,330

 

 

 

247,166

 

 

Other assets, net

 

 

579,124

 

 

 

528,896

 

 

Total assets

 

$

19,209,938

 

 

$

19,220,967

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

Mortgage loans, net

 

$

1,622,036

 

 

$

1,627,256

 

 

Secured term loan, net

 

 

401,569

 

 

 

401,515

 

 

Unsecured notes, net

 

 

3,306,873

 

 

 

3,305,467

 

 

Term loan facilities, net

 

 

3,213,904

 

 

 

3,211,814

 

 

Revolving facility

 

 

—

 

 

 

—

 

 

Accounts payable and accrued expenses

 

 

240,538

 

 

 

200,590

 

 

Resident security deposits

 

 

180,197

 

 

 

180,455

 

 

Other liabilities

 

 

74,732

 

 

 

103,435

 

 

Total liabilities

 

 

9,039,849

 

 

 

9,030,532

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of March 31, 2024 and December 31, 2023

 

 

—

 

 

 

—

 

 

Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 612,485,098 and 611,958,239 outstanding as of March 31, 2024 and December 31, 2023, respectively

 

 

6,125

 

 

 

6,120

 

 

Additional paid-in capital

 

 

11,153,703

 

 

 

11,156,736

 

 

Accumulated deficit

 

 

(1,099,957

)

 

 

(1,070,586

)

 

Accumulated other comprehensive income

 

 

74,826

 

 

 

63,701

 

 

Total stockholders’ equity

 

 

10,134,697

 

 

 

10,155,971

 

 

Non-controlling interests

 

 

35,392

 

 

 

34,464

 

 

Total equity

 

 

10,170,089

 

 

 

10,190,435

 

 

Total liabilities and equity

 

$

19,209,938

 

 

$

19,220,967

 

 

 

 

 

 

 

 

Consolidated Statements of Operations

($ in thousands, except shares and per share amounts)

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q1 2023

 

 

 

(unaudited)

 

(unaudited)

 

Revenues:

 

 

 

 

 

Rental revenues

 

$

571,430

 

 

$

535,217

 

 

Other property income

 

 

60,667

 

 

 

51,298

 

 

Management fee revenues

 

 

13,942

 

 

 

3,375

 

 

Total revenues

 

 

646,039

 

 

 

589,890

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

Property operating and maintenance

 

 

230,397

 

 

 

208,497

 

 

Property management expense

 

 

31,237

 

 

 

23,584

 

 

General and administrative

 

 

23,448

 

 

 

17,452

 

 

Interest expense

 

 

89,845

 

 

 

78,047

 

 

Depreciation and amortization

 

 

175,313

 

 

 

164,673

 

 

Impairment and other

 

 

4,137

 

 

 

1,163

 

 

Total expenses

 

 

554,377

 

 

 

493,416

 

 

 

 

 

 

 

 

Gains (losses) on investments in equity securities, net

 

 

(209

)

 

 

88

 

 

Other, net

 

 

5,973

 

 

 

(1,494

)

 

Gain on sale of property, net of tax

 

 

50,498

 

 

 

29,671

 

 

Losses from investments in unconsolidated joint ventures

 

 

(5,138

)

 

 

(4,155

)

 

 

 

 

 

 

 

Net income

 

 

142,786

 

 

 

120,584

 

 

Net income attributable to non-controlling interests

 

 

(436

)

 

 

(342

)

 

 

 

 

 

 

 

Net income attributable to common stockholders

 

 

142,350

 

 

 

120,242

 

 

Net income available to participating securities

 

 

(192

)

 

 

(171

)

 

 

 

 

 

 

 

Net income available to common stockholders — basic and diluted

 

$

142,158

 

 

$

120,071

 

 

 

 

 

 

 

 

Weighted average common shares outstanding — basic

 

 

612,219,520

 

 

 

611,588,465

 

 

Weighted average common shares outstanding — diluted

 

 

613,807,166

 

 

 

612,564,298

 

 

 

 

 

 

 

 

Net income per common share — basic

 

$

0.23

 

 

$

0.20

 

 

Net income per common share — diluted

 

$

0.23

 

 

$

0.20

 

 

 

 

 

 

 

 

Dividends declared per common share

 

$

0.28

 

 

$

0.26

 

 

 

 

 

 

 

 

Glossary and Reconciliations

Average Monthly Rent

Average monthly rent represents average monthly rental income per home for occupied properties in an identified population of homes over the measurement period, and reflects the impact of non-service rental concessions and contractual rent increases amortized over the life of the lease.

Average Occupancy

Average occupancy for an identified population of homes represents (i) the total number of days that the homes in such population were occupied during the measurement period, divided by (ii) the total number of days that the homes in such population were owned during the measurement period.

Bad Debt

Bad debt represents the Company's reserves for residents' accounts receivables balances that are aged greater than 30 days, under the rationale that a resident's security deposit should cover approximately the first 30 days of receivables. For all resident receivables balances aged greater than 30 days, the amount reserved as bad debt is 100% of outstanding receivables from the resident, less the amount of the resident's security deposit on hand. For the purpose of determining age of receivables, charges are considered to be due based on the terms of the original lease, not based on a payment plan if one is in place. All rental revenues and other property income, in both Total Portfolio and Same Store Portfolio presentations, are reflected net of bad debt.

Core Operating Expenses

Core operating expenses for an identified population of homes reflect property operating and maintenance expenses, excluding any expenses recovered from residents.

Core Revenues

Core revenues for an identified population of homes reflects total revenues, net of any resident recoveries.

EBITDA, EBITDAre, and Adjusted EBITDAre

EBITDA, EBITDAre, and Adjusted EBITDAre are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. The Company defines EBITDA as net income or loss computed in accordance with accounting principles generally accepted in the United States (“GAAP”) before the following items: interest expense; income tax expense; depreciation and amortization; and adjustments for unconsolidated joint ventures. National Association of Real Estate Investment Trusts (“Nareit”) recommends as a best practice that REITs that report an EBITDA performance measure also report EBITDAre. The Company defines EBITDAre, consistent with the Nareit definition, as EBITDA, further adjusted for gain on sale of property, net of tax, impairment on depreciated real estate investments, and adjustments for unconsolidated joint ventures. Adjusted EBITDAre is defined as EBITDAre before the following items: share-based compensation expense; severance; casualty losses, net; (gains) losses on investments in equity securities, net; and other income and expenses. EBITDA, EBITDAre, and Adjusted EBITDAre are used as supplemental financial performance measures by management and by external users of the Company's financial statements, such as investors and commercial banks. Set forth below is additional detail on how management uses EBITDA, EBITDAre, and Adjusted EBITDAre as measures of performance.

The GAAP measure most directly comparable to EBITDA, EBITDAre, and Adjusted EBITDAre is net income or loss. EBITDA, EBITDAre, and Adjusted EBITDAre are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's EBITDA, EBITDAre, and Adjusted EBITDAre may not be comparable to the EBITDA, EBITDAre, and Adjusted EBITDAre of other companies due to the fact that not all companies use the same definitions of EBITDA, EBITDAre, and Adjusted EBITDAre. Accordingly, there can be no assurance that the Company's basis for computing these non-GAAP measures is comparable with that of other companies. See below for a reconciliation of GAAP net income to EBITDA, EBITDAre, and Adjusted EBITDAre.

Funds from Operations (FFO), Core Funds from Operations (Core FFO), and Adjusted Funds from Operations (AFFO)

FFO, Core FFO, and Adjusted FFO are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. FFO is defined by Nareit as net income or loss (computed in accordance with GAAP) excluding gains or losses from sales of previously depreciated real estate assets, plus depreciation, amortization and impairment of real estate assets, and adjustments for unconsolidated joint ventures.

The Company believes that FFO is a meaningful supplemental measure of the operating performance of its business because historical cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization. Because real estate values have historically risen or fallen with market conditions, management considers FFO an appropriate supplemental performance measure as it excludes historical cost depreciation and amortization, impairment on depreciated real estate investments, gains or losses related to sales of previously depreciated homes, as well non-controlling interests, from GAAP net income or loss.

The GAAP measure most directly comparable to Core FFO and Adjusted FFO is net income or loss. Core FFO and Adjusted FFO are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's Core FFO and Adjusted FFO may not be comparable to the Core FFO and Adjusted FFO of other companies due to the fact that not all companies use the same definition of Core FFO and Adjusted FFO. Accordingly, there can be no assurance that the Company's basis for computing these non-GAAP measures is comparable with that of other companies. See “Reconciliation of FFO, Core FFO, and Adjusted FFO” for a reconciliation of GAAP net income to FFO, Core FFO, and Adjusted FFO.

Net Operating Income (NOI)

NOI is a non-GAAP measure often used to evaluate the performance of real estate companies. The Company defines NOI for an identified population of homes as rental revenues and other property income less property operating and maintenance expense (which consists primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel expenses, repairs and maintenance, leasing costs, and marketing expense). NOI excludes: interest expense; depreciation and amortization; property management expense; general and administrative expense; impairment and other; gain on sale of property, net of tax; (gains) losses on investments in equity securities, net; other income and expenses; management fee revenues; and income from investments in unconsolidated joint ventures.

The GAAP measure most directly comparable to NOI is net income or loss. NOI is not used as a measure of liquidity and should not be considered as an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's NOI may not be comparable to the NOI of other companies due to the fact that not all companies use the same definition of NOI. Accordingly, there can be no assurance that the Company's basis for computing this non-GAAP measure is comparable with that of other companies.

The Company believes that Same Store NOI is also a meaningful supplemental measure of the Company's operating performance for the same reasons as NOI and is further helpful to investors as it provides a more consistent measurement of the Company's performance across reporting periods by reflecting NOI for homes in its Same Store Portfolio.

See below for a reconciliation of GAAP net income to NOI for the Company's total portfolio and NOI for its Same Store Portfolio.

Recurring Capital Expenditures or Recurring CapEx

Recurring Capital Expenditures or Recurring CapEx represents general replacements and expenditures required to preserve and maintain the value and functionality of a home and its systems as a single-family rental.

Rental Rate Growth

Rental rate growth for any home represents the percentage difference between the monthly rent from an expiring lease and the monthly rent from the next lease, and, in each case, reflects the impact of any amortized non-service rent concessions and amortized contractual rent increases. Leases are either renewal leases, where the Company's current resident chooses to stay for a subsequent lease term, or a new lease, where the Company's previous resident moves out and a new resident signs a lease to occupy the same home.

Same Store / Same Store Portfolio

Same Store or Same Store portfolio includes, for a given reporting period, wholly owned homes that have been stabilized and seasoned, excluding homes that have been sold, homes that have been identified for sale to an owner occupant and have become vacant, homes that have been deemed inoperable or significantly impaired by casualty loss events or force majeure, homes acquired in portfolio transactions that are deemed not to have undergone renovations of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio, and homes in markets that the Company has announced an intent to exit where the Company no longer operates a significant number of homes.

Homes are considered stabilized if they have (i) completed an initial renovation and (ii) entered into at least one post-initial renovation lease. An acquired portfolio that is both leased and deemed to be of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio may be considered stabilized at the time of acquisition.

Homes are considered to be seasoned once they have been stabilized for at least 15 months prior to January 1st of the year in which the Same Store portfolio was established.

The Company believes presenting information about the portion of its portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of the Company's comparable homes across periods and about trends in its organic business.

Total Homes / Total Portfolio

Total homes or total portfolio refers to the total number of homes owned, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated. Unless otherwise indicated, total homes or total portfolio refers to the wholly owned homes and excludes homes owned in joint ventures.

Turnover Rate

Turnover rate represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population.

Reconciliation of FFO, Core FFO, and AFFO

($ in thousands, except shares and per share amounts) (unaudited)

 

 

 

 

 

 

 

FFO Reconciliation

 

Q1 2024

 

Q1 2023

 

Net income available to common stockholders

 

$

142,158

 

 

$

120,071

 

 

Net income available to participating securities

 

 

192

 

 

 

171

 

 

Non-controlling interests

 

 

436

 

 

 

342

 

 

Depreciation and amortization on real estate assets

 

 

171,918

 

 

 

162,084

 

 

Impairment on depreciated real estate investments

 

 

60

 

 

 

178

 

 

Net gain on sale of previously depreciated investments in real estate

 

 

(50,498

)

 

 

(29,671

)

 

Depreciation and net gain on sale of investments in unconsolidated joint ventures

 

 

2,519

 

 

 

2,121

 

 

FFO

 

$

266,785

 

 

$

255,296

 

 

 

 

 

 

 

 

Core FFO Reconciliation

 

Q1 2024

 

Q1 2023

 

FFO

 

$

266,785

 

 

$

255,296

 

 

Non-cash interest expense related to amortization of deferred financing costs, loan discounts, and non-cash interest expense from derivatives (1)

 

 

9,217

 

 

 

9,132

 

 

Share-based compensation expense

 

 

7,900

 

 

 

6,498

 

 

Severance expense

 

 

90

 

 

 

153

 

 

Casualty losses, net (1)

 

 

4,082

 

 

 

988

 

 

(Gains) losses on investments in equity securities, net

 

 

209

 

 

 

(88

)

 

Core FFO

 

$

288,283

 

 

$

271,979

 

 

 

 

 

 

 

 

AFFO Reconciliation

 

Q1 2024

 

Q1 2023

 

Core FFO

 

$

288,283

 

 

$

271,979

 

 

Recurring capital expenditures (1)

 

 

(37,122

)

 

 

(37,293

)

 

AFFO

 

$

251,161

 

 

$

234,686

 

 

 

 

 

 

 

 

Net income available to common stockholders

 

 

 

 

 

Weighted average common shares outstanding — diluted

 

 

613,807,166

 

 

 

612,564,298

 

 

 

 

 

 

 

 

Net income per common share — diluted

 

$

0.23

 

 

$

0.20

 

 

 

 

 

 

 

 

FFO, Core FFO, and AFFO

 

 

 

 

 

Weighted average common shares and OP Units outstanding — diluted

 

 

615,987,206

 

 

 

614,536,039

 

 

 

 

 

 

 

 

FFO per share — diluted

 

$

0.43

 

 

$

0.42

 

 

 

 

 

 

 

 

Core FFO per share — diluted

 

$

0.47

 

 

$

0.44

 

 

 

 

 

 

 

 

AFFO per share — diluted

 

$

0.41

 

 

$

0.38

 

 

 

 

 

 

 

 

(1)

Includes the Company's share from unconsolidated joint ventures.

Reconciliation of Total Revenues to Same Store Core Revenues, Quarterly

(in thousands) (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q4 2023

 

Q3 2023

 

Q2 2023

 

Q1 2023

 

Total revenues (Total Portfolio)

 

$

646,039

 

 

$

624,321

 

 

$

617,695

 

 

$

600,372

 

 

$

589,890

 

 

Management fee revenues

 

 

(13,942

)

 

 

(3,420

)

 

 

(3,404

)

 

 

(3,448

)

 

 

(3,375

)

 

Total portfolio resident recoveries

 

 

(37,795

)

 

 

(35,050

)

 

 

(36,641

)

 

 

(32,776

)

 

 

(31,966

)

 

Total Core Revenues (Total Portfolio)

 

 

594,302

 

 

 

585,851

 

 

 

577,650

 

 

 

564,148

 

 

 

554,549

 

 

Non-Same Store Core Revenues

 

 

(35,863

)

 

 

(34,767

)

 

 

(33,416

)

 

 

(25,689

)

 

 

(25,568

)

 

Same Store Core Revenues

 

$

558,439

 

 

$

551,084

 

 

$

544,234

 

 

$

538,459

 

 

$

528,981

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Property Operating and Maintenance Expenses to Same Store Core Operating Expenses, Quarterly

(in thousands) (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q4 2023

 

Q3 2023

 

Q2 2023

 

Q1 2023

 

Property operating and maintenance expenses (Total Portfolio)

 

$

230,397

 

 

$

228,542

 

 

$

229,488

 

 

$

213,808

 

 

$

208,497

 

 

Total Portfolio resident recoveries

 

 

(37,795

)

 

 

(35,050

)

 

 

(36,641

)

 

 

(32,776

)

 

 

(31,966

)

 

Core Operating Expenses (Total Portfolio)

 

 

192,602

 

 

 

193,492

 

 

 

192,847

 

 

 

181,032

 

 

 

176,531

 

 

Non-Same Store Core Operating Expenses

 

 

(13,781

)

 

 

(13,439

)

 

 

(13,071

)

 

 

(9,985

)

 

 

(10,053

)

 

Same Store Core Operating Expenses

 

$

178,821

 

 

$

180,053

 

 

$

179,776

 

 

$

171,047

 

 

$

166,478

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to Same Store NOI, Quarterly

 

(in thousands) (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q1 2024

 

Q4 2023

 

Q3 2023

 

Q2 2023

 

Q1 2023

 

Net income available to common stockholders

 

$

142,158

 

 

$

129,368

 

 

$

131,637

 

 

$

137,698

 

 

$

120,071

 

 

Net income available to participating securities

 

 

192

 

 

 

178

 

 

 

181

 

 

 

166

 

 

 

171

 

 

Non-controlling interests

 

 

436

 

 

 

395

 

 

 

403

 

 

 

418

 

 

 

342

 

 

Interest expense

 

 

89,845

 

 

 

90,049

 

 

 

86,736

 

 

 

78,625

 

 

 

78,047

 

 

Depreciation and amortization

 

 

175,313

 

 

 

173,159

 

 

 

170,696

 

 

 

165,759

 

 

 

164,673

 

 

Property management expense

 

 

31,237

 

 

 

25,246

 

 

 

23,399

 

 

 

23,580

 

 

 

23,584

 

 

General and administrative

 

 

23,448

 

 

 

22,387

 

 

 

22,714

 

 

 

19,791

 

 

 

17,452

 

 

Impairment and other

 

 

4,137

 

 

 

3,069

 

 

 

2,496

 

 

 

1,868

 

 

 

1,163

 

 

Gain on sale of property, net of tax

 

 

(50,498

)

 

 

(49,092

)

 

 

(57,989

)

 

 

(46,788

)

 

 

(29,671

)

 

(Gains) losses on investments in equity securities, net

 

 

209

 

 

 

(237

)

 

 

499

 

 

 

(524

)

 

 

(88

)

 

Other, net (1)

 

 

(5,973

)

 

 

(5,533

)

 

 

2,533

 

 

 

3,941

 

 

 

1,494

 

 

Management fee revenues

 

 

(13,942

)

 

 

(3,420

)

 

 

(3,404

)

 

 

(3,448

)

 

 

(3,375

)

 

Losses from investments in unconsolidated joint ventures

 

 

5,138

 

 

 

6,790

 

 

 

4,902

 

 

 

2,030

 

 

 

4,155

 

 

NOI (Total Portfolio)

 

 

401,700

 

 

 

392,359

 

 

 

384,803

 

 

 

383,116

 

 

 

378,018

 

 

Non-Same Store NOI

 

 

(22,082

)

 

 

(21,328

)

 

 

(20,345

)

 

 

(15,704

)

 

 

(15,515

)

 

Same Store NOI

 

$

379,618

 

 

$

371,031

 

 

$

364,458

 

 

$

367,412

 

 

$

362,503

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Includes interest income and other miscellaneous income and expenses.

Reconciliation of Net Income to Adjusted EBITDAre

(in thousands, unaudited)

 

 

 

 

 

 

Trailing Twelve Months (TTM) Ended

 

 

 

Q1 2024

 

Q1 2023

 

March 31, 2024

 

December 31, 2023

 

Net income available to common stockholders

 

$

142,158

 

 

$

120,071

 

 

$

540,861

 

 

$

518,774

 

 

Net income available to participating securities

 

 

192

 

 

 

171

 

 

 

717

 

 

 

696

 

 

Non-controlling interests

 

 

436

 

 

 

342

 

 

 

1,652

 

 

 

1,558

 

 

Interest expense

 

 

89,845

 

 

 

78,047

 

 

 

345,255

 

 

 

333,457

 

 

Interest expense in unconsolidated joint ventures

 

 

5,235

 

 

 

4,578

 

 

 

18,912

 

 

 

18,255

 

 

Depreciation and amortization

 

 

175,313

 

 

 

164,673

 

 

 

684,927

 

 

 

674,287

 

 

Depreciation and amortization of investments in unconsolidated joint ventures

 

 

2,927

 

 

 

2,475

 

 

 

10,921

 

 

 

10,469

 

 

EBITDA

 

 

416,106

 

 

 

370,357

 

 

 

1,603,245

 

 

 

1,557,496

 

 

Gain on sale of property, net of tax

 

 

(50,498

)

 

 

(29,671

)

 

 

(204,367

)

 

 

(183,540

)

 

Impairment on depreciated real estate investments

 

 

60

 

 

 

178

 

 

 

309

 

 

 

427

 

 

Net gain on sale of investments in unconsolidated joint ventures

 

 

(381

)

 

 

(330

)

 

 

(1,719

)

 

 

(1,668

)

 

EBITDAre

 

 

365,287

 

 

 

340,534

 

 

 

1,397,468

 

 

 

1,372,715

 

 

Share-based compensation expense

 

 

7,900

 

 

 

6,498

 

 

 

30,905

 

 

 

29,503

 

 

Severance

 

 

90

 

 

 

153

 

 

 

914

 

 

 

977

 

 

Casualty losses, net (1)

 

 

4,082

 

 

 

988

 

 

 

11,294

 

 

 

8,200

 

 

(Gains) losses on investments in equity securities, net

 

 

209

 

 

 

(88

)

 

 

(53

)

 

 

(350

)

 

Other, net (2)

 

 

(5,973

)

 

 

1,494

 

 

 

(5,032

)

 

 

2,435

 

 

Adjusted EBITDAre

 

$

371,595

 

 

$

349,579

 

 

$

1,435,496

 

 

$

1,413,480

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Includes the Company's share from unconsolidated joint ventures.

(2)

Includes interest income and other miscellaneous income and expenses.

Reconciliation of Net Debt / Trailing Twelve Months (TTM) Adjusted EBITDAre

 

(in thousands, except for ratio) (unaudited)

 

 

 

 

 

 

 

 

 

 

As of

 

As of

 

 

 

 

March 31, 2024

 

December 31, 2023

 

 

Mortgage loans, net

 

$

1,622,036

 

 

$

1,627,256

 

 

 

Secured term loan, net

 

 

401,569

 

 

 

401,515

 

 

 

Unsecured notes, net

 

 

3,306,873

 

 

 

3,305,467

 

 

 

Term loan facility, net

 

 

3,213,904

 

 

 

3,211,814

 

 

 

Revolving facility

 

 

—

 

 

 

—

 

 

 

Total Debt per Balance Sheet

 

 

8,544,382

 

 

 

8,546,052

 

 

 

Retained and repurchased certificates

 

 

(87,477

)

 

 

(87,703

)

 

 

Cash, ex-security deposits and letters of credit (1)

 

 

(764,359

)

 

 

(713,898

)

 

 

Deferred financing costs, net

 

 

42,049

 

 

 

45,518

 

 

 

Unamortized discounts on note payable

 

 

20,716

 

 

 

21,376

 

 

 

Net Debt (A)

 

$

7,755,311

 

 

$

7,811,345

 

 

 

 

 

 

 

 

 

 

 

 

For the TTM Ended

 

For the TTM Ended

 

 

 

 

March 31, 2024

 

December 31, 2023

 

 

Adjusted EBITDAre (B)

 

$

1,435,496

 

 

$

1,413,480

 

 

 

 

 

 

 

 

 

 

Net Debt / TTM Adjusted EBITDAre (A / B)

 

5.4x

 

5.5x

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Represents cash and cash equivalents and the portion of restricted cash that excludes security deposits and letters of credit

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240430143308/en/

Investor Relations Contact Scott McLaughlin 844.456.INVH (4684) IR@InvitationHomes.com

Media Relations Contact Kristi DesJarlais 972.421.3587 Media@InvitationHomes.com