Aimco Reports First Quarter 2025 Results and Recent Highlights

, /PRNewswire/ -- Apartment Investment and Management Company ("Aimco") (NYSE: AIV) announced today first quarter results for 2025 and provided highlights on recent activities. Financial Results Aimco's net loss attributable to common stockholders per share, on a fully dilutive basis, was $(0.10) for the quarter ended March 31, 2025. Net Operating Income ("NOI") from Aimco's Stabilized Operating Properties was $25.1 million in the first quarter 2025, up 2.7% year-over-year. CEO Commentary Wes Powell, Aimco President and Chief Executive Officer, comments: "We continue to see strong demand for rental housing across the Aimco portfolio. "At our stabilized properties, primarily located in suburban Boston and Chicago, average revenue per home is now greater than $2,300 per month and effective rental rate growth accelerated in April, increasing 5.8% over the prior lease. In addition, 2025 average daily occupancy has remained strong through April at greater than 97%, in line with 2024. "In April, we completed the lease-up of our luxury single-family-rental community in Corte Madera, California and expect to reach stabilized occupancy later this quarter. Aimco's two newly constructed apartment communities in the Washington, D.C. market remain on track to reach stabilized occupancy by year end. Leasing at these properties has been in line with expectations thus far through 2025 and they are well positioned given their high quality and the broad customer segments they attract. "Aimco has one development project currently under construction, financed in partnership with a leading investment firm and located on Miami's waterfront. The ultra-luxury tower remains on schedule and budget, with more than 97% of the project having been bought out and pricing protected via a guaranteed maximum price construction contract. "In addition, the Aimco balance sheet remains strong and flexible, with appropriate liquidity and contractual options extending our debt's weighted average maturity to more than five years. "We remain committed to accretive and disciplined capital allocation. During the first quarter, Aimco returned $0.60 per share to stockholders in the form of a special dividend, an amount representing the net proceeds received from 2024 asset sales. Further, the previously announced $520 million contract to sell Aimco's assets located on Brickell Bay Drive in Miami, Florida ("the Brickell Assemblage") is scheduled to close later this year with the buyer having increased its non-refundable deposit to $43 million. Additionally, and in collaboration with Aimco's Board and advisory team, we continue to actively explore opportunities to further unlock and maximize stockholder value. "Finally, Aimco's performance is made possible by a committed team and proven platform which has recently been selected to receive several awards for culture, engagement, and performance. I offer my sincere appreciation for the team's commitment to create value for Aimco stockholders, their fellow teammates and the communities in which we operate." Highlights Aimco's Stabilized Operating revenue, expenses, and NOI increased 2.7%, 2.7%, and 2.7%, respectively, year-over-year in the first quarter, with average daily occupancy flat year-over-year at 97.9% and average monthly revenue per apartment home increasing by 2.7% to $2,309. Aimco's three recently completed residential development projects currently in lease-up, containing a total of 933 units, remain on plan to reach stabilized occupancy in 2025. In March, the buyer, with which Aimco is under agreement to sell the Brickell Assemblage for $520 million, exercised a contractual closing extension option that required its non-refundable deposit to be increased by $5 million, from $38 million to $43 million. In January, Aimco paid a special cash dividend of $0.60 per share to stockholders, distributing the net proceeds from 2024 asset sales. Operating Property Results Aimco owns a diversified portfolio of operating apartment communities located in eight major U.S. markets with average rents in line with local market averages. Results at Aimco's Stabilized Operating Properties were as follows: First Quarter Stabilized Operating Properties Year-over-Year Sequential ($ in millions) 2025 2024 Variance 4Q 2024 Variance Average Daily Occupancy 97.9 % 97.9 % — 97.9 % — Revenue, before utility reimbursements $35.6 $34.6 2.7 % $35.5 0.1 % Expenses, net of utility reimbursements 10.5 10.2 2.7 % 9.6 9.6 % Net operating income (NOI) 25.1 24.4 2.7 % 25.9 (3.4) % Revenue in the first quarter 2025 was $35.6 million, up 2.7% year-over-year, resulting from a 2.7% increase in average monthly revenue per apartment home to $2,309 and Average Daily Occupancy of 97.9%, flat year-over-year. Effective rents during the first quarter 2025 were 5.2% higher, on average, than the previous lease, with new leases up 4.6% and renewals up 6.6%. For residents whose leases were expiring, 62.7% signed renewals. In April, effective rents were 5.8% higher, on average, than the previous lease. The median annual household income of new residents was $120,600 in the first quarter 2025, representing a rent-to-income ratio of 21%. Expenses in the first quarter 2025 were up 2.7% year-over-year and 9.6% compared to the fourth quarter 2024, primarily due to seasonal related expenses and higher real estate taxes expected from 2025 property assessments and prior period adjustments recorded in the fourth quarter 2024. NOI in the first quarter 2025 was $25.1 million, up 2.7% year-over-year. Value Add and Opportunistic Investments Development and Redevelopment Aimco generally seeks development and redevelopment opportunities where barriers to entry are high, target customers can be clearly defined, and Aimco has a comparative advantage over others in the market. Aimco's value add and opportunistic investments may also target portfolio acquisitions, operational turnarounds, and re-entitlements. As of March 31, 2025, Aimco had one multifamily development project under construction and three multifamily communities that have been substantially completed and are now in lease-up. In addition to Aimco's core multifamily developments, The Benson Hotel and Faculty Club was completed in 2023 and remains in the stabilization process. Aimco also has a pipeline of future value add opportunities in Southeast Florida, the Washington D.C. Metro Area, and Colorado's Front Range. During the first quarter, $20.6 million of capital was invested in Aimco's development and redevelopment activities, primarily funded through construction loan draws. Updates on active development projects and Aimco's pipeline include: In Upper Northwest Washington D.C., all 689 apartment homes at Upton Place were delivered in 2024 and construction is substantially complete. As of April 30, 2025, 413 units were leased or pre-leased and 344 were occupied. Additionally, as of April 30, 2025, approximately 92% of the project's 105K square feet of retail space had been leased with our two large anchor tenants open for business. In Bethesda, Maryland, all 220 of the highly tailored apartment homes at the first phase of Strathmore Square were delivered in 2024 and construction is substantially complete. As of April 30, 2025, 132 units had been leased or pre-leased and 109 were occupied. In Corte Madera, California, construction is complete at Oak Shore. As of April 30, 2025, the ultra-luxury single-family rental community was 96% leased, with 22 of the 24 homes occupied. In Miami's Edgewater neighborhood, construction remains on schedule and budget at 34th Street, an ultra-luxury waterfront residential tower that will include rental homes averaging more than 2,500 square feet, with oversized private terraces, top-of-the-line finishes, and unobstructed views of Biscayne Bay. As of April 30, 2025, more than 97% of the project has been bought out with pricing protected via a guaranteed maximum price construction contract. Aimco expects to welcome the first residents in 3Q 2027 and to stabilize occupancy in 4Q 2028. In the first quarter 2025, Aimco invested $1.4 million into programming, design, documentation, and entitlement efforts primarily related to its 901 North development site, located in Fort Lauderdale, Florida. Investment & Disposition Activity Aimco is focused on prudently allocating capital and delivering strong investment returns. Consistent with Aimco's capital allocation philosophy, it aims to monetize the value within its assets when accretive uses of the proceeds are identified and invest when the risk-adjusted returns are superior to other uses of capital. In December 2024, Aimco entered into an agreement to sell, during 2025, the Brickell Assemblage for a gross price of $520 million. The buyer's initial non-refundable deposit of $38 million was increased in March 2025 to $43 million in exchange for the buyer extending closing to August of 2025, as allowed under the terms of the contract. The sale remains subject to certain closing conditions and one remaining extension option that would extend closing at the buyer's option to the fourth quarter of 2025, with such extension requiring the buyer to further increase its non-refundable deposit. Prior to closing, the buyer has the right to exercise an option to finance, for a period of 18 months, up to $115 million of the purchase price with a transferable seller financing note from Aimco. If exercised, the purchase price increases by $20 million, to $540 million, and the note would carry an annual interest rate of 12%. Net proceeds from the transaction, accounting for the associated property-level debt and deferred tax liability, are estimated to range from $300 to $320 million depending on the buyer's election regarding seller financing. Upon receipt, Aimco intends to return the majority of the net proceeds from the transaction to stockholders. Balance Sheet and Financing Activity Aimco is highly focused on maintaining a strong balance sheet, including ample liquidity. As of March 31, 2025, Aimco had access to $225.2 million, including $49.1 million of cash on hand, $27.6 million of restricted cash, and the capacity to borrow up to $148.5 million on its $150.0 million revolving credit facility. Aimco's net leverage as of March 31, 2025, was as follows: as of March 31, 2025 Aimco Share, $ in thousands Amount Weighted Avg. Maturity (Yrs.) [1] Total non-recourse fixed rate debt $ 693,506 6.5 Total non-recourse construction loan debt 397,573 2.4 Total property debt secured by assets held for sale 159,226 Cash and restricted cash (76,417) Net Leverage $ 1,173,888 [1] Weighted average maturities presented exclude contractual extension rights. As of March 31, 2025, 100% of Aimco's total debt was either fixed rate or hedged with interest rate cap protection. Considering investments under contract to sell and including contractual extensions, Aimco has no debt maturing prior to June 2027. Public Market Equity Special Cash Dividend On December 19, 2024, Aimco's Board of Directors declared a $0.60 per share special cash dividend to distribute the net proceeds from 2024 asset sales to stockholders. The dividend was paid on January 31, 2025, to holders of record as of January 14, 2025. Repurchases In January, prior to the $0.60 dividend distribution and Aimco's Board of Directors announcing the expansion of its strategic review process, Aimco repurchased 29,498 shares of its common stock at a weighted average price of $8.66 per share. Since the start of 2022, Aimco has repurchased 14.5 million shares. In the first quarter 2025, Aimco Operating Partnership redeemed 11,477 units of its equity securities for cash at a weighted average price of $9.22 per unit, inclusive of the $0.60 dividend distribution. Commitment to Enhance Stockholder Value On January 9, 2025, Aimco and its Board of Directors announced that, while pleased with the transformation and simplification of the Aimco portfolio and the objective results delivered over the past four years, shares of AIV continue to trade at a meaningful discount to Aimco's estimate of the private market value of Aimco's assets and investment platform. This disconnect has limited Aimco's ability to fund new investment opportunities and accelerate growth. Therefore, Aimco's Board of Directors announced its decision to explore additional alternatives in an effort to further unlock and maximize stockholder value. The strategic process has expanded upon Aimco's ongoing efforts such as reducing exposure to development activity and monetizing certain assets, and includes, but is not limited to, the exploration of a sale or merger of Aimco as a whole, potential sales of the major components of the business (in one or a series of transactions), and an acceleration of individual asset sales. The Board of Directors' guiding principle is to produce an outcome that delivers maximum value to Aimco stockholders. The strategic process is being overseen by Aimco's Investment Committee, comprised of four independent Aimco Board Members. Morgan Stanley & Co. LLC is serving as financial advisor to Aimco. There can be no assurance that this expanded strategic process will result in any transaction or transactions or other strategic changes or outcomes, and the timing or outcome of any such event is similarly uncertain. Aimco does not intend to disclose or comment on developments related to the foregoing unless or until it determines that further disclosure is appropriate or required. 2025 Outlook 1Q 2025 2025 $ in millions (except per share amounts) Forecast is full year unless otherwise noted Results Forecast Net income (loss) per share – diluted [1] $(0.10) $1.50 - $1.60 Operating Properties Revenue Growth, before utility reimbursements 2.7 % 2.5% - 3.5% Operating Expense Growth, net of utility reimbursements 2.7 % 5.0% - 6.0% Net Operating Income Growth 2.7 % 1.0% - 3.0% Recurring Capital Expenditures $3 $11 - $13 Developments and Redevelopments Total Direct Costs of Projects in Occupancy Stabilization at Period End [2] $638 $68 Total Direct Costs of Projects Under Construction at Period End [2] $240 $240 Direct Project Costs on Active Developments [3] $15 $50 - $60 Direct Planning Costs [4] $1 $7 - $10 Real Estate Transactions Acquisitions None None Dispositions [5] None $520 - $540 General and Administrative $8 $33 - $34 Leverage Interest Expense, net of capitalization [6] $16 $63 - $65 [1] Net income (loss) per share - diluted includes estimated gains from the announced transactions which are under contract. [2] Includes land or leasehold value. [3] Aimco's planned costs on active developments is primarily related to its 34th Street development project and will be funded through committed construction loan and preferred equity draws. Aimco funded its equity commitment to the joint venture through the contribution of land plus an incremental $5 million in 3Q 2024. [4] Includes direct costs related to advancing planning efforts for certain pipeline projects. [5] Includes the Brickell Assemblage which is under contract to sell in 2025. Aimco does not provide specific guidance regarding future transactions prior to a contract being executed and the buyer's deposit becoming nonrefundable. [6] Includes GAAP interest expense, exclusive of the amortization of deferred financing costs, and reduced by interest rate option payments which are included in the Realized and unrealized gains (losses) on interest rate options line on Aimco's income statement. Supplemental Information The full text of this Earnings Release and the Supplemental Information referenced in this release are available on Aimco's website at investors.aimco.com. Glossary & Reconciliations of Non-GAAP Financial and Operating Measures Financial and operating measures found in this Earnings Release and the Supplemental Information include certain financial measures used by Aimco management that are measures not defined under accounting principles generally accepted in the United States, or GAAP. Certain Aimco terms and Non-GAAP measures are defined in the Glossary in the Supplemental Information and Non-GAAP measures reconciled to the most comparable GAAP measures. About Aimco Aimco is a diversified real estate company primarily focused on value add and opportunistic investments, targeting the U.S. multifamily sector. Aimco's mission is to make real estate investments where outcomes are enhanced through our human capital so that substantial value is created for investors, teammates, and the communities in which we operate. Aimco is traded on the New York Stock Exchange as AIV. For more information about Aimco, please visit our website www.aimco.com. Team and Culture Aimco has a national presence with corporate headquarters in Denver, Colorado and Washington, D.C. Our investment platform is managed by experienced regional professionals who leverage in-depth local market knowledge, creating a comparative advantage when sourcing, evaluating, and executing investment opportunities. Above all else, Aimco is committed to a culture of integrity, respect, and collaboration. Forward-Looking Statements This document contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements include all statements that are not historical statements of fact and those regarding our intent, belief, or expectations. Words such as "anticipate(s)," "expect(s)," "intend(s)," "plan(s)," "believe(s)," "may," "will," "would," "could," "should," "seek(s)" and similar expressions, or the negative of these terms, are intended to identify such forward-looking statements. The forward-looking statements in this document include, without limitation, statements regarding our future plans and goals, including the timing and amount of capital expected to be returned to stockholders, our pipeline investments and projects, our plans to eliminate certain near term debt maturities, our estimated value creation and potential, our timing, scheduling and budgeting, projections regarding revenue and expense growth, our plans to form joint ventures, our plans for new acquisitions or dispositions, our strategic partnerships and value added therefrom, the potential for adverse economic and geopolitical conditions, which negatively impact our operations, including on our ability to maintain current or meet projected occupancy, rental rate and property operating results; the effect of acquisitions, dispositions, developments, and redevelopments; our ability to meet budgeted costs and timelines, and achieve budgeted rental rates related to our development and redevelopment investments; expectations regarding sales of our apartment communities and the use of proceeds thereof; the availability and cost of corporate debt; and our ability to comply with debt covenants, including financial coverage ratios. We caution investors not to place undue reliance on any such forward-looking statements. These forward-looking statements are based on management's judgment as of this date, which is subject to risks and uncertainties that could cause actual results to differ materially from our expectations, including, but not limited to: the risk that the 2025 plans and goals may not be completed, as expected, in a timely manner or at all; geopolitical events which may adversely affect the markets in which our securities trade, and other macro-economic conditions, including, among other things, rising interest rates and inflation, which heightens the impact of the other risks and factors described herein; real estate and operating risks, including fluctuations in real estate values and the general economic climate in the markets in which we operate and competition for residents in such markets; national and local economic conditions, including the pace of job growth and the level of unemployment; the amount, location and quality of competitive new housing supply; the timing and effects of acquisitions, dispositions, developments and redevelopments; expectations regarding sales of apartment communities and the use of proceeds thereof; insurance risks, including the cost of insurance, and natural disasters and severe weather such as hurricanes; supply chain disruptions, particularly with respect to raw materials such as lumber, steel, and concrete; the impact of tariffs and global trade disruptions on us; financing risks, including the availability and cost of financing; the risk that cash flows from operations may be insufficient to meet required payments of principal and interest; the risk that earnings may not be sufficient to maintain compliance with debt covenants, including financial coverage ratios; legal and regulatory risks, including costs associated with prosecuting or defending claims and any adverse outcomes; the terms of laws and governmental regulations that affect us and interpretations of those laws and regulations; and possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of apartment communities presently owned by us. In addition, our current and continuing qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code of 1986, as amended (the "Code") and depends on our ability to meet the various requirements imposed by the Code through actual operating results, distribution levels and diversity of stock ownership. Readers should carefully review Aimco's financial statements and the notes thereto, as well as the section entitled "Risk Factors" in Item 1A of Aimco's Annual Report on Form 10-K for the year ended December 31, 2024, and subsequent Quarterly Reports on Form 10-Q and other documents Aimco files from time to time with the SEC. These filings identify and address important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. These forward-looking statements reflect management's judgment and expectations as of this date, and Aimco undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. Consolidated Statements of Operations (in thousands, except per share data) (unaudited) Three Months EndedMarch 31, 2025 2024 REVENUES: Rental and other property revenues $ 52,352 $ 50,203 OPERATING EXPENSES: Property operating expenses 23,065 21,199 Depreciation and amortization 16,421 19,468 General and administrative expenses 8,180 8,549 Total operating expenses 47,666 49,216 Interest income 2,092 2,648 Interest expense (17,438) (13,370) Realized and unrealized gains (losses) on interest rate contracts (261) 1,672 Realized and unrealized gains (losses) on equity investments (397) (271) Other income (expense), net (479) (1,592) Income (loss) before income tax benefit (11,797) (9,926) Income tax benefit (expense) 85 2,730 Net income (loss) (11,712) (7,196) Net (income) loss attributable to redeemable noncontrolling interests in consolidated real estate partnerships (2,673) (3,560) Net (income) loss attributable to noncontrolling interests in consolidated real estate partnerships (296) 16 Net (income) loss attributable to common noncontrolling interests in Aimco Operating Partnership 765 554 Net income (loss) attributable to Aimco $ (13,916) $ (10,186) Net income (loss) attributable to common stockholders pershare – basic $ (0.10) $ (0.07) Net income (loss) attributable to common stockholders pershare – diluted $ (0.10) $ (0.07) Weighted-average common shares outstanding – basic 136,903 140,594 Weighted-average common shares outstanding – diluted 136,903 140,594 Consolidated Balance Sheets (in thousands) (unaudited) March 31, December 31, 2025 2024 Assets Buildings and improvements $ 1,372,255 $ 1,348,925 Land 397,968 398,182 Total real estate 1,770,223 1,747,107 Accumulated depreciation (513,868) (499,274) Net real estate 1,256,355 1,247,833 Cash and cash equivalents 49,147 141,072 Restricted cash 27,575 31,367 Notes receivable 59,360 58,794 Right-of-use lease assets - finance leases 107,395 107,714 Other assets, net 97,004 94,051 Assets held for sale, net 275,929 276,079 Total assets $ 1,872,765 $ 1,956,910 Liabilities and Equity Non-recourse property debt, net $ 685,226 $ 685,420 Non-recourse construction loans, net 397,769 385,240 Total indebtedness 1,082,995 1,070,660 Deferred tax liabilities 101,721 101,457 Lease liabilities - finance leases 122,882 121,845 Dividends payable 1,006 89,182 Accrued liabilities and other 101,276 100,849 Liabilities related to assets held for sale, net 160,331 160,620 Total liabilities 1,570,211 1,644,613 Redeemable noncontrolling interests in consolidated real estate partnerships 146,391 142,931 Equity: Common Stock 1,372 1,364 Additional paid-in capital 426,309 425,002 Retained earnings (deficit) (317,195) (303,409) Total Aimco equity 110,486 122,957 Noncontrolling interests in consolidated real estate partnerships 39,600 39,560 Common noncontrolling interests in Aimco Operating Partnership 6,077 6,849 Total equity 156,163 169,366 Total liabilities and equity $ 1,872,765 $ 1,956,910 SOURCE Apartment Investment and Management Company (Aimco) WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

Aimco Reports First Quarter 2025 Results and Recent Highlights

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