One of the leading multifamily real estate investment trust
(REIT) companies -
) - has raised its outlook for 2013 and extended its ties with
The New Guidance
In particular, the company increased the guidance for funds from
operations (FFO) per share as adjusted to $1.36 to $1.40 from
$1.33 to $1.39. This is based on an uptick in the lower-end of
the same store revenue outlook, which is now forecasted to grow
in the range of 4.50% - 5.00%, compared with the prior outlook of
4.00% - 5.00%.
Hence, the company expects same store net operating income to
register growth of 5.25% to 6.00%, up from the prior guidance of
4.25% - 6.00%.
Moreover, UDR has extended its ties with MetLife by forming an
additional 50/50 partnerships with the latter. This joint venture
includes operating communities and developable land parcels at
UDR's Vitruvian Park master plan development situated in Addison,
As part of the formation of the joint venture, net proceeds of
$199.9 million were received by UDR. Moreover, the expansion of
its UDR/MetLife II Joint Venture was made through a swap of
ownership interests in certain UDR/MetLife I Joint Venture
communities, over and above a net cash payment of $15.6 million
The outlook was raised as solid fundamentals in a number of UDR's
markets are facilitating better-than-expected same-store and non
same-store operating trends. In addition, the company expects the
combined partnerships and swap deals to be accretive to some
extent to its FFO per share.
A guidance raise at UDR is encouraging as it increases
shareholders' confidence in the stock. Moreover, the company's
ongoing extensive development and redevelopment activity to
strengthen its presence in the upscale markets provide notable
Furthermore, UDR is focusing on allocating its capital actively
and improving cash flow to support dividend growth. Such
efforts are expected to fortify its balance sheet and enhance
shareholder returns going forward.
UDR currently carries a Zacks Rank #3 (Hold). Other REITs that
are performing better and deserve a look include -
Select Income REIT
CBRE Group, Inc.
The Macerich Company
). All these stocks carry a Zacks Rank #2 (Buy).
Funds from operations, a widely used metric to gauge the
performance of REITs, is obtained after adding depreciation and
amortization and other non-cash expenses to net income.
CBRE GROUP INC (CBG): Free Stock Analysis
MACERICH CO (MAC): Free Stock Analysis Report
SELECT INCOME (SIR): Free Stock Analysis
UDR INC (UDR): Free Stock Analysis Report
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