Camden Property Trust

Good morning and welcome to Camden Property Trust's first quarter 2025 earnings conference call. I'm Kim Callahan, Senior Vice President of Investor Relations. Joining me today are Rick Campo, Camden's Chairman and Chief Executive Officer, Keith Oden, Executive Vice Chairman, and Alex Jessett, President and Chief Financial Officer. Today's event is being webcast through the Investors section of our website at camdenliving.com, and a replay will be available shortly after the call ends. And please note, this event is being recorded. Before we begin our prepared remarks, I would like to advise everyone that we will be making forward-looking statements based on our current expectations and beliefs. These statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially from expectations. Further information about these risks can be found in our filings with the SEC, and we encourage you to review them. Any forward-looking statements made on today's call represent management's current opinions, and the company assumes no obligation to update or supplement these statements because of subsequent events. As a reminder, Camden's complete first quarter 2025 earnings release is available in the investor section of our website at camdenliving.com, and it includes reconciliations to non-GAAP financial measures, which will be discussed on this call. We would like to respect everyone's time and complete our call within one hour, so please limit your initial question to one, then rejoin the queue if you have a follow-up question or additional items to discuss. If we are unable to speak with everyone in the queue today, we'd be happy to respond to additional questions by phone or email after the call concludes. At this time, I'll turn the call over to Rick Campo.

Thanks, Kim. The unhold music for our call today featured the 1970s rock band Bad Company. This week, Bad Company was finally admitted to the Rock and Roll Hall of Fame, filling one of the most glaring admissions from Rock Music's Hall of Fame. Also in April, Camden was once again named by Fortune magazine as one of the 100 best companies to work for. This marks the 18th consecutive year Camden has achieved this honor. So this April was an excellent month for 100 great companies, but also an excellent month for one bad company. If Fortune magazine ever decides to select a best company to work for Hall of Fame, we suspect Camden would be a first ballot inductee. Thank you to our Camden team for your unwavering commitment to improving the lives of our teammates, our customers, and our shareholders one experience at a time. We had a great first quarter and exceeded our operating expectations, beating our guidance by 4 cents per share. Clearly, in the last month, the operating outlook has become more complicated, but the good news is clear. New supply has peaked in our markets, and apartment absorption continues to be strong. In fact, new starts are at a 13-year low and are down 80% in Austin and between 65% and 80% in Houston, Denver, Charlotte, Raleigh, Atlanta, Nashville, and Washington DC. Rent affordability continues to be a tailwind with wage growth outpacing rent growth by over 300 basis points for the past 28 months. The premium to own versus rent continues to be at historically high levels, making apartment homes more affordable. Camden Sunbelt markets continue to dominate job growth, population growth, and growth in young adult households between 20 and 39 years old. Camden Sunbelt markets are 50-60% less expensive for residents than high-cost coastal markets. Today's economic uncertainty is not new for us. We have positioned our company to do well on all market conditions with a strong balance sheet, a geographically diverse portfolio, and a great team. Well, you're in the Sun Belt because that's where the growth is, and the Sun Belt has historically weathered tougher economic conditions better and bounced back faster than other markets. People always need a place to live, and our Camden teams will welcome them home. Thank you, and Keith Oden is up next.

Thanks, Rick. Operating conditions across our portfolio are playing out as we expected. In our market outlook on last year's call, we projected our top five markets for revenue growth this year would be Tampa, L.A. Orange County, San Diego Inland Empire, Washington, D.C. Metro, and Houston. Not surprisingly, those were, in fact, the top five performers for the quarter, with same property revenue growth ranging from 1.3% to 4.5% in those markets, compared to our overall portfolio at 0.8%. Rental rates for the first quarter had effective new leases down 3.1% and renewals up 3.3% for a blended rate of negative 0.1%. This was in line with our expectations for the quarter and reflected a 100 basis point improvement from the negative 1.1% blended rate we reported in the fourth quarter of 24. Our preliminary April results are also on track and showing improvement versus the first quarter of 25. Occupancy for the first quarter showed slight improvement averaging 95.4% versus 95.3% in the fourth quarter of 24, and we expect occupancy to remain relatively stable for the remainder of the year. Renewal offers from May, June, and July were sent out with an average increase of 4.2%. Turnover rates across our portfolio remain very low and our first quarter 25 annualized net turnover rate of 31% was one of the lowest in our company's history. We attribute this, in part, to continued low levels of move-outs for home purchases, which were 10.4% this quarter, along with high resident retention driven by the hard work, dedication, and commitment of our team members in delivering exceptional service and support to our customers, as indicated by our Customer Sentiment Score. Camden's customer sentiment score was 91.1 for the first quarter of 2025. This is the highest score we have ever received since we began measuring customer sentiment in 2014 and clearly demonstrates the appreciation and satisfaction our residents and customers feel for Camden. And as Rick mentioned earlier, we're proud to have been recognized for the 18th consecutive year as one of the 100 best companies to work for by Fortune magazine, most recently ranking number 18. Thank you, Team Camden, for your energy and commitment to maintaining a truly amazing work environment. We know that happy team members, along with happy residents and customers, ultimately lead to happy shareholders. I'll now turn the call over to Alex Jesset, Cabinet's President and Chief Financial Officer.