Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide more details on the four acquisitions under contract and any value-add opportunities? A: Brett Taft, Chief Operating Officer, explained that the acquisitions include two communities in New Jersey with 266 sites, fully occupied, purchased for $24.6 million. These are stabilized but offer potential for rent increases and sales profits. The two Maryland communities, previously under contract, are expected to close in the second quarter. One Maryland property has a value-add component with 45 vacant sites, where UMH plans to upgrade and implement their rental home program to drive occupancy growth.
Q: What interest rates do you expect for the refinancing of mortgages due in the first half of 2025? A: Anna Chew, Executive VP and CFO, stated that they are in discussions with Fannie Mae and expect interest rates to be under 6%, likely in the 5.5% to 5.75% range. The refinancing proceeds are expected to exceed current balances, allowing for additional capital extraction.
Q: What are the main factors that could influence the high or low end of your 2025 guidance range? A: Jim Lykins, Vice President of Capital Markets, identified home sales and acquisitions as the primary factors. Achieving the high end would involve exceeding the four acquisitions discussed and increasing home sales beyond 2024 levels.
Q: How do you plan to achieve the target of adding 800 new rental homes in 2025? A: Brett Taft noted that they have about 680 homes in inventory or on order, with 490 already delivered. These homes are in strong markets and are expected to rent quickly once set up. They anticipate faster growth in the rental home program in the first half of the year compared to last year.
Q: How does the cost of solar shingles compare to traditional shingles, and who bears the cost? A: Eugene Landy, Founder and Chairman, explained that installing solar shingles in the factory costs under $15,000, compared to over $25,000 if done on-site. A third-party company owns the solar roofing, reducing tenants' utility bills, and UMH receives a small payment for roof use. The cost does not impact UMH's rental unit expenses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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