Q1 Income Down 9%, But BSR REIT Expects Growth This Year


Q1 Income Down 9%, But BSR REIT Expects Growth This Year

BSR Real Estate Investment Trust of Little Rock this week reported first-quarter total portfolio net operating income of $13.4 million and total portfolio revenue of $25.8 million, down 9% and 6.4% year-over-year, respectively.

Net operating income is a measure of performance used by real estate operating companies and REITs. The company is publicly traded on the Toronto Stock Exchange (TSX HOM.U).

"With the focus of our capital recycling program now primarily oriented to the deployment of our $287 million in acquisition capacity, the REIT is positioned to significantly expand our property portfolio on a highly accretive basis," CEO John Bailey said in a news release. 

Bailey said the company reported better-than-expected revenue growth in its primary markets — Dallas, Austin and Houston, Texas. He said he expects "significant growth" in net operating income and adjusted funds from operations in the second half of 2021 and throughout 2022. 

"In addition, the repositioning of the portfolio into these high growth markets has resulted in an 8.3% increase in the REIT’s [net asset value] to $13.21 per unit," he said.

During the quarter, the REIT:

  • Sold 6.3 million shares for $69 million;
  • Announced its acquisition of three apartment communities in Texas for $195 million (two of those transactions have closed, and the third is expected to close this month); and
  • Sold three non-core properties for $34.8 million.

Weighted average rent was $1,134 per apartment unit as of March 31, up 18.6% from the $956 reported at the same time last year.

In addition, the company sold Mountain Ranch in Fayetteville in April for $49.5 million, exiting the northwest Arkansas market. BSR then exited the Pascagoula, Mississippi, metropolitan statistical area this month when it sold Regency Woods for $8.3 million.