Equity Residential's (EQR) Q1 2022 Earnings Call Transcript

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, and welcome to Equity Residential's First Quarter 2022 Earnings Conference Call. Today's call is being recorded.

At this time, I'd like to turn the call over to Marty McKenna. Please go ahead.

Marty McKenna – IR

Good morning, and thanks for joining us to discuss Equity Residential's first quarter 2022 results. Our featured speakers today are Mark Parrell, our President and CEO; and Michael Manelis, our Chief Operating Officer; Bob Garechana, our Chief Financial Officer; and Alec Brackenridge, our Chief Investment Officer, are here with us as well for the Q&A.

Our earnings release is posted in the Investors section of equityapartments.com. Please be advised that certain matters discussed during this conference call may constitute forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are subject to certain economic risks and uncertainties. The company assumes no obligation to update or supplement these statements that become untrue because of subsequent events.

Now I will turn the call over to Mark Parrell.

Mark Parrell – President and CEO

Thank you, Marty. Good morning and thank you all for joining us today to discuss our first quarter results. In a minute, Michael Manelis will walk you through a market update, and then we will take your questions. The growth in our business continues as evidenced by our first quarter performance. Demand is strong and lease rates are growing faster than we expected. While we are well aware of the recent increases in economic and geopolitical uncertainties, we continue to manage our business by focusing on our operation dashboards, not on the news headlines.

Those dashboards continue to nearly universally flash a green signal as our well-located properties and excellent service attract our affluent renter demographic in droves, allowing us to retain a record number of our residents and push rents up nearly everywhere we operate. All of this allowed us to increase normalized funds from operations by 13% in the quarter and we expect this growth to accelerate over the next few quarters.

As we mentioned in our March operating update, our first quarter same-store revenue results were negatively impacted by an increase in delinquency in Southern California. It appears to us that a relatively small number of Southern California residents, who had previously been good payers, declined to pay rent in order to apply for state rental relief funds. While we remain open to working with residents with true COVID-related hardships, this sort of behavior is not acceptable, and we will continue to work with these residents to obtain our full rental payment.