Independence Realty Trust, Inc.

There will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, again press star and 1. Please limit your questions to one initial and one follow-up question. I will now turn the call over to Stephanie Cruz and Kelly. You may begin.

Good morning and thank you for joining us to review Independence Realty Trust Second Quarter 2025 Financial Results. On the call with me today are Scott Schaefer, Chief Executive Officer, Jim Sieber, President and Chief Financial Officer, and Janice Richards, Executive Vice President of Operations. Today's call is being recorded and webcast through the Investors section of our website at irtliving.com and a replay will be available shortly after this call ends. Before we begin our prepared remarks, I'll remind everyone we may make forward-looking based on our current expectations and beliefs as to future events and financial performance. These statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially. Such statements are made in good faith pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and IRT does not undertake to update them except as may be required by law. Please refer to IRT's press release, supplemental information, and filings with the SEC for further information about these risks. A copy of IRT's earnings press release and supplemental information is attached to IRT's current report on the Form 8K that is available in the Investors section of our website. They contain reconciliations of non-GAP financial measures referenced on this call to the most direct comparable GAP financial measure. With that, it's my pleasure to turn the call over to Scott Schaefer.

Thanks Stephanie and thank you all for joining us this morning. Second quarter same store NOI and core FFO-preciado results were in line with our expectations as operating expense savings offset lower than expected revenue growth. Same store revenues increased 1% over the prior year. We finished the quarter modestly ahead of expectations on renewal leasing due to another quarter of strong retention. Debt continued to decline and average occupancy rose modestly versus a year ago. However, our blended rent growth in the quarter lagged our expectations due to market conditions that were softer than anticipated. Lingering supply pressures in some markets, with potential residents being more discerning due to continuing macroeconomic uncertainties, pressured market rents to a greater degree than we originally anticipated as we sought to continue to maintain occupancy during this timeframe. Jim will cover a revised outlook for 2025 with respect to leasing spreads and overall revenue growth. On the positive side, same store operating expenses decreased 60 basis points over the prior year quarter and fully offset softer revenue growth. Lower repair and maintenance and turnover costs, lower real estate taxes, and a reduction in our insurance premium renewal all contributed to this improvement in expenses. We completed 454 value-add renovations during the quarter in a total of 729 completions for the first six months of the year, achieving a weighted average return on investment of .2% for both periods. As Jim will discuss later, given our stronger than planned retention rates year to date, we expect to complete about 650 fewer renovations this year as compared to our original goal, which is still a 26% increase over 2024 completions. In terms of investment activity, we are seeing opportunities to deploy capital accretively by trading out of older vintage assets with higher future capex needs and to newer communities with lower capex profiles. On the disposition side, during the quarter, we identified three assets that we expect to sell during the fourth quarter. For new investments, we are under contract to acquire two communities in Orlando during the third quarter for an aggregate purchase price of $155 million. Both properties are in close proximity to existing IRT communities, which improves our market presence and should enable us to realize meaningful operating synergies. Beyond these pending transactions, our acquisition pipeline remains strong. Our updated guidance implies an additional $315 million of acquisitions before year end, and we have ample liquidity to fund these accretive investments on a leverage neutral basis through capital recycling. Regarding our markets, the good news is that deliveries in general are tapering off across our portfolio with permitting and starts data supporting our outlook for more muted supply growth for the next few years. Looking at market level data from Costar, Yardy Matrix, and Green Street, we're seeing a reduction in deliveries settling out to less than 2% supply growth in our markets in 2026, which represents a 43% reduction from 2024 actual deliveries. As a result, we believe things continue to set up nicely for a strong releasing environment in 2026, as demand for apartments in our markets is expected to remain strong. I'll now turn it over to Jim.