• Core Funds from Operations (FFO): $189.8 million or $1.72 per share, $0.04 ahead of prior guidance.
• Same-Property Revenue Growth: Ranged from 1.3% to 4.5% in top-performing markets.
• Rental Rates: Effective new leases down 3.1%, renewals up 3.3%, blended rate of negative 0.1%.
• Occupancy: Averaged 95.4% in Q1 2025, slight improvement from 95.3% in Q4 2024.
• Net Turnover Rate: 31%, one of the lowest in company history.
• Customer Sentiment Score: 91.1, highest since 2014.
• Acquisitions: Two acquisitions totaling $199 million.
• Development Starts: $184 million in new development, with plans for additional projects.
• Commercial Paper Program: $600 million program, borrowing at rates 50 basis points below line of credit.
• Full Year Core FFO Guidance: Increased by $0.03 per share to $6.78.
• Second Quarter Core FFO Guidance: Expected range of $1.67 to $1.71 per share.

• Warning! GuruFocus has detected 10 Warning Sign with CPT.

Release Date: May 02, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Camden Property Trust (NYSE:CPT) exceeded its operating expectations for the first quarter, beating guidance by $0.04 per share.
• New supply in CPT's markets has peaked, with new starts at a 13-year low, indicating a favorable supply-demand balance.
• CPT's Sunbelt markets continue to dominate in job growth, population growth, and young adult household growth, providing a strong demand base.
• CPT's customer sentiment score reached a record high of 91.1, reflecting high resident satisfaction.
• CPT was recognized for the 18th consecutive year as one of the 100 Best Companies to Work For by Fortune magazine, highlighting its strong corporate culture.

Negative Points

• Rental rates for the first quarter showed a blended rate of negative 0.1%, indicating pressure on new lease pricing.
• CPT's markets like Nashville and Austin are expected to remain challenged throughout 2025 due to high levels of new deliveries.
• The company is maintaining its same-store guidance due to macroeconomic uncertainty, indicating cautiousness in its outlook.
• CPT's acquisitions are expected to have a higher yield than its dispositions, potentially impacting FFO in the latter part of 2025.
• The lease-up of CPT's single-family rental communities has been slower than expected, indicating challenges in this segment.

Q & A Highlights

Q: Given the recent macro uncertainty, why is Camden maintaining its same-store guidance? A: Richard Campo, CEO, explained that the current environment is filled with uncertainty, which has led to a cautious approach. While Camden's business is performing well, the uncertainty about jobs and the broader market has led them to maintain their guidance rather than adjust it upwards.

Q: Which Sunbelt markets are seeing quicker stabilization of deliveries, and where are the biggest challenges? A: Richard Campo, CEO, noted that Nashville and Austin will continue to face challenges throughout 2025 due to high levels of deliveries. However, markets like DC Metro, Houston, San Diego Inland Empire, and L.A./Orange County are performing well and are expected to continue leading the portfolio.

Q: What is Camden's perspective on the DC market amid potential government job cuts? A: Richard Campo, CEO, stated that there is no evidence of negative impacts from government job cuts on Camden's DC properties. Occupancy and lease rates remain high, and the company has not seen any significant issues related to government employment changes.

Q: How is Camden approaching construction costs and tariffs in their development projects? A: Richard Campo, CEO, mentioned that they are accounting for a 2% to 3% increase in costs due to tariffs. They have adjusted their supply chains to be less vulnerable and are seeing margin compression among contractors, which helps offset these costs.

Q: What is Camden's strategy regarding acquisitions and dispositions, particularly in Austin and Nashville? A: Richard Campo, CEO, indicated that Camden is focused on increasing exposure in Austin and Nashville due to their growth potential. They are also looking at other markets like Raleigh and Tampa for acquisitions, while planning to sell older, more capital-intensive assets.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.