Aug 10, 2026, 5:14 PM ETReal Estate

BRT Apartments Corp. — Second Quarter 2026 Earnings Summary

BRTBRT APARTMENTS CORP

Financial Performance

Reported a net loss of $3.2 million ($0.19 per diluted share) for the quarter ended June 30, 2026, compared to a net loss of $2.6 million ($0.14 per diluted share) in the second quarter of 2025.
Funds from Operations (FFO) was $0.29 per diluted share, unchanged from $0.29 in the second quarter of 2025.
Adjusted Funds from Operations (AFFO) was $0.36 per diluted share, unchanged from $0.36 in the second quarter of 2025.
Combined Portfolio Net Operating Income (NOI) was $15.2 million for the quarter, up from $15.1 million in the prior-year period.
Consolidated revenues were $24.47 million for the quarter, compared to $24.20 million in the prior year.
Consolidated total expenses were $27.62 million for the quarter, compared to $27.15 million in the prior year.
Equity in earnings of unconsolidated joint ventures was a loss of $1,000 for the quarter, compared to a gain of $299,000 in the prior year.
Total debt outstanding was $649.8 million as of June 30, 2026, consisting of $612.6 million in mortgages payable and $37.2 million in subordinated notes.
Debt to Enterprise Value was 71% as of June 30, 2026, compared to 69% in the prior year.
Weighted average interest rate on combined debt was 4.18% as of June 30, 2026.
Debt Service Coverage Ratio for the quarter ended June 30, 2026, was 1.53.

The Company anticipates acquiring Ranch Lake Apartments (336 units in Bradenton, FL) in the first quarter of 2027 for approximately $80 million, including the assumption of a $45.7 million HUD-insured mortgage at 2.91% interest maturing in 2056.
The Company anticipates acquiring a multifamily property in Houston, TX, in August 2026 through a joint venture with a 70% interest, for approximately $33 million, with an estimated $23.4 million mortgage at 5.5% interest maturing in 2033.
The Company anticipates contributing approximately $8.8 million in equity toward the Houston acquisition, including $1.9 million in working capital reserves, and incurring an estimated $450,000 in transaction costs and $700,000 in deferred financing costs.
No assurance is provided that the Houston transaction will be completed on the indicated terms or time frame or that it will be accretive to earnings.

The portfolio consists of 31 properties (21 consolidated, 10 unconsolidated) with a total of 8,311 units as of June 30, 2026.
Average occupancy for the combined portfolio was 94.4% in the second quarter of 2026, compared to 94.1% in the prior year.
Weighted average monthly rent per occupied unit was $1,423 in the second quarter of 2026, up from $1,399 in the prior year.
The Value-Add Program rehabilitated 26 units during the quarter with estimated rehab costs of $140,000 ($5,400 per unit), resulting in an estimated average monthly rent increase of $108 and an estimated annualized ROI of 24%.
There are 171 estimated units available to be renovated over the next 24 months.
Capital expenditures for the quarter included $1.93 million in recurring capital expenditures and $830,000 in non-recurring capital expenditures, with a BRT share of $2.54 million.
Replacements expensed as operating expenses totaled $902,269 for the quarter.

The portfolio is concentrated in the Southeastern United States and Texas, making the Company susceptible to adverse developments in those specific markets.
Top markets by NOI contribution in the consolidated portfolio include Mississippi (17.1%), Tennessee (15.4%), and Alabama (12.8%).
The unconsolidated portfolio is heavily weighted toward Texas (33.1% of NOI contribution) and South Carolina (28.8% of NOI contribution).
The Company faces risks related to the competitive environment affecting the ability to acquire properties, lease apartments, and maintain rental rates.

Risks include unfavorable economic conditions, inflation, volatile interest rates, and the possibility of a recession.
The Company faces risks related to the concentration of properties in the Southeastern U.S. and Texas.
Challenges include the limited number of multifamily property investment opportunities and the difficulty of acquiring properties without joint venture partners.
Potential risks include impairment in the value of real estate, failure of property managers, and exposure to risks inherent in value-add multifamily properties.
The Company is exposed to risks associated with the condition of Fannie Mae or Freddie Mac and changes in federal, state, and local laws and regulations.
Risks include extreme weather events, lack of sufficient insurance coverage, and potential environmental liabilities.

Management declared a dividend of $0.25 per share for the second quarter of 2026, maintaining the same level as the prior year.
The Company maintained a revolving credit facility of up to $40.0 million with full availability and a maturity in September 2027.
Management highlighted the refinancing of the maturing mortgage on Civic Center 2 - Southaven, MS, in July 2026, increasing the loan from $27.8 million to $47.9 million at a 5.38% interest rate.

The Company repurchased 202,828 shares during the second quarter of 2026 at a weighted average price of $14.28.
From July 1, 2026, to July 16, 2026, the Company repurchased an additional 48,523 shares at an average price of $15.12.
As of August 3, 2026, the Company was authorized to repurchase up to approximately $4.9 million in shares under its repurchase program.
The Board of Directors replenished the repurchase program to $10.0 million on March 11, 2026, and extended the program through December 31, 2028.
The Company holds preferred equity investments in two joint ventures (Wilmington, NC and Kennesaw, GA) totaling $18.25 million, with annual returns of 13%.
The Company's portfolio includes 26 units rehabilitated in the quarter, with an estimated 171 units available for renovation over the next 24 months.