BRT Apartments (BRT) Q4 2024 earnings summary

Executive summary

• BRT Apartments Corp. is an internally managed REIT focused on multi-family properties, with 21 wholly owned properties (5,420 units) and interests in 8 joint ventures (2,527 units) as of December 31, 2024, primarily in the Southeast US and Texas.

• In 2024, $18.3 million was invested in preferred equity in two joint ventures, a $27.4 million mortgage was obtained, and $3.5 million of common stock was repurchased.

• The company faces challenges from inflation, volatile interest rates, oversupply in certain markets, and limited acquisition opportunities.

Financial highlights

• 2024 total revenues were $95.6 million, up 2.2% from 2023, driven by a 1.3% increase in average rental rates and higher interest income from new preferred equity investments.

• Net loss attributable to common stockholders was $9.8 million in 2024, compared to net income of $3.9 million in 2023, mainly due to lower gains from joint venture property sales and higher operating expenses.

• Funds from Operations (FFO) decreased 7% to $20.9 million, and Adjusted Funds from Operations (AFFO) decreased 7.6% to $26.7 million year-over-year.

• Same store Net Operating Income (NOI) decreased by $163,000, while overall NOI was flat at $51.2 million.

• Cash and cash equivalents at year-end were $27.9 million, with $40 million available under the credit facility.

Outlook and guidance

• Management expects insurance expenses to decrease by $750,000 to $1 million in 2025 due to more favorable premiums.

• Estimated $1.2 million in interest income from preferred equity investments in 2025.

• The company anticipates continued challenges in acquisitions due to market conditions and limited funds, with a focus on alternative investments and joint ventures.