European Residential Real Estate Investment Trust

Good morning all and thank you for joining us on today's European Residential REIT third quarter 2025 results conference call. My name is Drew and I'll be the operator on the call today. After today's prepared remarks we will hold a Q&A session. If you wish to register a question please press star followed by one on your telephone keypad and to withdraw your question it's star followed by two. With that it's my pleasure to hand over to Nicole Dolan Investor Relations to begin. Please go ahead when you're ready.

Thank you, operator, and good morning, everyone. Before we begin, let me remind everyone that during our conference call this morning, we may include forward-looking statements about expected future events and the financial and operating results of eREZ, which are subject to certain risks and uncertainties. We direct your attention to slide two and our other regulatory filings for important information about these statements. I will now turn the call over to Mark Kenney, Chief Executive Officer.

Thanks, Nicole. Good morning, everyone. Joining me this morning is Jenny Chow, our Chief Financial Officer. Let's get started on slide four with a high-level update. During Q3, eRES continued to execute on its strategic disposition program, focusing on maximizing unit holder value. We successfully completed several key transactions, including the sale of our commercial properties in Belgium and Germany, the closing of previously announced disposition of a portfolio containing 1,446 residential suites in the Netherlands, and the sale of an additional 110 suite property in Rotterdam. Collectively, these transactions generated €397 million in gross consideration, bringing our 2,025 disposition total to €489 million, with part of that capital used to repay €238 million in debt. With remaining proceeds, cleared and paid a special cash distribution of €0.90 per unit, in line with our commitment to return capital to unit holders. Operationally, rent growth remained robust with same property occupied AMR increasing by 4.7% to €1,349 at current period end. However, you will see on slide five, our residential occupancy was down to 90.8% as of September 30th, 2025 on the total and same property portfolio. This reflects elevated vacancies associated with our disposition strategy as we are intentionally keeping additional suites offline each month in order to maximize sale value. With that introduction, I will now turn the call over to Jenny to highlight our financial results.

Thanks, Mark. Slide seven provides some key performance metrics for the third quarter of 2025. Due to lost rent on vacant units combined with an increase in repair and maintenance costs, the REITs NOI margin was down to 67.8% for the current quarter on the same property basis, from 76.2% realized for the three months ended September 30th, 2024. Our diluted FFO per unit was 0.13 Eurocent for Q3, which is down from €4 in the comparative period, primarily due to the significant amount of property sales that have been completed since. On slide 8, we've highlighted our resilient financial position and liquidity. As we've used part of our dis-decision proceeds to repay debt, our ratio of adjusted debt to market value has decreased to 34% as of September 30, 2025, down from 53% as that comparative period ends. We're also actively managing our access to liquidity and ensuring ongoing compliance with all covenants. Turning to slide nine, you'll see that we have no market just maturing over the remainder of 2025 and 26, which provides us with financial flexibility to continue executing on value maximizing transactions. As we advance on our best decision program, prudent financial stewardship will remain central in our decision making. With that, I will hand the call back to Mark.

Thanks, Jenny. By period end, eREDS' portfolio consisted of 1,033 residential suites and ancillary retail space in the Netherlands, as listed out on slide 11. We're continuing to work with our financial and real estate advisors on a sale process for this remaining portfolio. Buyer interest is still active, and the REIT is exploring several potential alternatives including individual asset transactions that present compelling value opportunities in the near term and or a larger portfolio disposition. These efforts are being advanced alongside certain structural and outstanding tax matters, including the previously disclosed reassessments by the Dutch Tax Authority. Ultimately, our primary focus is on realizing the full value of the REIT's remaining portfolio maximizing distribution of capital proceeds to unit holders. While the wind down process involves complexity and uncertainty, we remain committed to acting in the best interest of all unit holders and providing timely updates as developments unfold. With that, we would now be pleased to take any questions that you may have.

We can now begin today's Q&A session. If you would like to ask a question on the call today, please press star followed by one on your telephone keypad. And to withdraw your question, it's star followed by two. Our first question today comes from Sairam Srinivas from CoreMap Securities. Your line is now open. Please go ahead with your question.

Thank you, Arbita. Good morning, Mark, Jenny. Good morning. Mark, just going back to the timeline of transactions, are you basically comfortable with the idea that this would probably wrap up in Q4, or are we looking for something beyond that?

No, we've not provided clear guidance on a final wrap-up of the REIT. There are issues here, as we discussed, with tax and other issues to work out, but we will be providing definitive feedback when we have more certainty.

Fair enough. Thanks, Matt. That's all from me.

Thank you, Si. Okay, I'm not sure if the operator.

Okay, I think we have all the questions in the queue. Thank you. With that, we have no further questions in the queue at this time, and I'll hand back over for some closing comments to Mark Kenney.

Thank you, operator, and thank you, everyone, for joining us this morning. have any further questions please do not hesitate to contact us at any time thank you again have a great day thank you all that concludes today's call and you may now disconnect