Bluerock Homes Trust(US:BHM)2023-08-09 16:00Financial Performance - The total stockholders' equity decreased by $2.8 million from $160.0 million as of December 31, 2022, to $157.2 million as of June 30, 2023, primarily due to a net loss of $1.9 million [211]. - Rental and other property revenues increased by $5.9 million, or 40%, to $20.4 million for the six months ended June 30, 2023, compared to $14.5 million for the same prior year period [231]. - Net operating income (NOI) for the six months ended June 30, 2023, was $11.3 million, compared to $7.97 million in the prior year [246]. - Other income increased to $2.3 million for the three months ended June 30, 2023, compared to $0.1 million for the same prior year period [230]. Revenue and Occupancy - Rental and other property revenues increased by $2.6 million, or 34%, to $10.3 million for the three months ended June 30, 2023, compared to $7.7 million for the same period in 2022 [221]. - Average rent per occupied unit rose by $151, or 10.7%, to $1,557 compared to $1,406 during the prior year period [222]. - Average occupancy increased by 250 basis points from 91.8% to 94.3% year-over-year [222]. - Average rent per occupied unit rose by $172, or 12.5%, to $1,549, while average occupancy increased by 200 basis points from 94.2% to 92.2% year over year [232]. Expenses - Property operating expenses increased by $0.8 million, or 21%, to $4.6 million for the three months ended June 30, 2023, compared to $3.8 million for the same period in 2022 [224]. - Property operating expenses increased by $2.5 million, or 39%, to $9.1 million for the six months ended June 30, 2023, primarily due to home acquisitions and additional repairs [234]. - General and administrative expenses amounted to $1.8 million for the three months ended June 30, 2023, compared to $1.6 million for the same prior year period [226]. - General and administrative expenses amounted to $3.8 million for the six months ended June 30, 2023, up from $3.2 million in the prior year [236]. - Management fees to related parties amounted to $2.0 million for the three months ended June 30, 2023, with no management fee expense prior to October 6, 2022 [227]. - Property management and asset management fee expenses increased to $1.1 million for the three months ended June 30, 2023, compared to $0.8 million in the same prior year period [225]. - Property management and asset management fee expenses rose to $2.2 million for the six months ended June 30, 2023, compared to $1.5 million in the same prior year period [235]. Investments and Acquisitions - The company acquired 18 single-family residential units in Savannah, Georgia for approximately $4.2 million, fully funded in cash [206]. - During the six months ended June 30, 2023, the company increased its preferred equity investment commitments by $4.4 million across two joint ventures [210]. - The company acquired noncontrolling interests in properties, increasing ownership in Savannah-84 to 100% and in Indy-Springfield to 100% [208]. - The total number of preferred equity investments increased to $86.2 million at June 30, 2023, compared to $72.1 million at June 30, 2022 [230]. Cash Flow and Liquidity - As of June 30, 2023, the company had $79.9 million in cash available and a capacity of $100 million on revolving credit facilities, with approximately $17 million available [252]. - The company expects to fund liquidity requirements through cash flows from operations, proceeds from the Series A Redeemable Preferred Offering, and future mortgage debt financings [251]. - As of June 30, 2023, net cash provided by operating activities was $2.1 million, following a net loss of $6.5 million, adjusted for non-cash items of $9.1 million [264]. - During the six months ended June 30, 2023, net cash used in investing activities was $6.7 million, primarily due to $6.7 million in additional investments in unconsolidated real estate joint ventures [265]. - Net cash provided by financing activities was $8.2 million, mainly from $21.0 million in proceeds from revolving credit facilities [267]. Debt and Interest Rates - Estimated future required payments on mortgage notes payable and revolving credit facilities totaled $196.1 million as of June 30, 2023 [258]. - The weighted average interest rate on outstanding mortgage notes payable was 5.35% as of June 30, 2023 [87]. - A 100-basis point increase in interest rates would increase interest expense by approximately $50,000 for the quarter ended June 30, 2023 [90]. Market Conditions and Risks - The company is monitoring inflation and rising interest rates, which could negatively impact residents' ability to pay rents and overall results of operations [203]. - The company is subject to various legal actions but does not believe these will have a material adverse effect on its financial position or results of operations [192]. - The company has off-balance sheet arrangements that may materially affect its financial condition, revenues, or expenses as of June 30, 2023 [263]. - The company owns interests in seven joint ventures accounted for as held to maturity debt securities as of June 30, 2023 [263]. - Preferred equity investments are structured to provide a current and/or accrued preferred return during all phases of development [262]. REIT Qualification - The company intends to qualify as a REIT, requiring annual distribution of at least 90% of its REIT taxable income to stockholders [202].