Camden Property Trust Q3 Earnings Call Highlights

Key Points

• Q3 core FFO beat expectations at $1.71 per share, while Camden maintained its full-year midpoint of $6.75, supported by lower expenses and construction fees.
• After a sharper September slowdown, Camden cut its full-year same-store revenue outlook to flat from 0.5% growth and now expects NOI to decline 1.0%. New-lease and blended rent growth were modest, and the company expects occupancy and lease growth to ease in Q4.
• Camden completed its $1.625 billion California portfolio sale and said it currently favors share buybacks over acquisitions; it repurchased $50 million of shares in Q3. It also canceled planned acquisitions and paused Nashville and Denver developments amid higher rates and unfavorable construction economics.

Camden Property Trust NYSE: CPT reported third-quarter core funds from operations above its guidance midpoint, but lowered its full-year same-store revenue and net operating income forecasts after a sharper-than-expected seasonal slowdown in September.

The apartment owner maintained its full-year core FFO midpoint at $6.75 per share, saying lower operating expenses and higher third-party construction fees helped offset the weaker revenue outlook. Third-quarter core FFO was $1.71 per share, exceeding the company’s $1.69 guidance midpoint by 2 cents.

Chief Executive Officer Alex Jessett said 2026 was showing improvement over 2025, though not a full recovery. He pointed to lower apartment completions in Sunbelt markets and robust absorption, while noting that rental concessions remained persistent in many markets.

Leasing trends and revised outlook

For the third quarter, effective rates on new leases declined 2%, while renewal rates rose 3.6%, producing blended growth of 1%, President and Chief Operating Officer Laurie Baker said. All three measures improved from the second quarter, when new lease rates fell 3.3%, renewals rose 2.8% and blended rates declined 0.2%.

Still, new lease and blended growth came in at the low end of Camden’s anticipated ranges. Jessett said prospective-renter traffic fell more than expected in September, prompting the company to reduce prices. Concessions offered by competing properties ranged from roughly three weeks in West Palm Beach to two months in Austin, he said.

Preliminary October occupancy was 95.2%, in line with the prior year, Baker said. Signed leases improved from September to October, and the company sent renewal offers for December and January expirations with an average increase of 4.5%.

Camden now expects full-year same-store revenue growth of 0.0%, down from its prior midpoint of 0.5%. Its forecast for same-store net operating income, or NOI, calls for a 1.0% decline, compared with a previous expectation for a 0.6% decline. The company lowered its expense growth forecast to 1.75% from 2.5%, citing lower repairs and maintenance costs and property tax savings.

For the fourth quarter, Camden forecast core FFO of $1.63 to $1.67 per share. Chief Financial Officer Ben Fraker said the $1.65 midpoint reflects, among other factors, a full quarter without NOI from the company’s California dispositions and lower construction fees and interest income, partly offset by lower interest expense.

Fraker said Camden expects fourth-quarter blended lease growth to remain slightly positive, but below the third quarter’s 1% level. Jessett said the company expects fourth-quarter occupancy in the low 95% range, compared with the mid-95% range in the third quarter.

California sale and investment decisions

Camden closed the $1.625 billion sale of its California portfolio on July 29. Fraker said the proceeds were used primarily to repay debt, fund acquisitions and repurchase shares. The company also sold its remaining Los Angeles land parcel after quarter-end for $10.7 million, leaving it with no assets in California.

Camden acquired three communities during the third quarter for approximately $305 million, bringing year-to-date community acquisitions to $755 million. It also started construction on Camden RTP, a 398-unit, $130 million development in the Raleigh area.

However, the company canceled plans to acquire two operating communities and a land parcel after interest rates rose. Jessett said Camden sought price adjustments but sellers were unwilling to meet its terms. The company does not expect further acquisitions in 2026 and, based on its latest tax analysis, does not expect to pay much, if any, special dividend related to the California sales.

Jessett said Camden currently prefers buying back shares at a discount to making acquisitions, although it could find acquisition opportunities at better prices next year. Fraker said the company repurchased $50 million of shares during the quarter and had $248 million remaining under its authorization.

Camden also decided not to proceed for now with development projects in Nashville and Denver, recording non-cash impairments on both sites. Jessett said the company recently bought an existing Nashville property across from its land for about $370,000 per unit, compared with an estimated cost above $600,000 per unit to build. He said Camden does not plan to sell the land now and may revisit development later.

Market conditions

Baker said concessions had improved in markets including Atlanta, Southeast Florida, Dallas and Houston, while Denver and Nashville continued to face persistent concessions. Austin had Camden’s strongest third-quarter occupancy, despite substantial concessions in that market, she said.

Jessett said he expects the gap in revenue performance among Camden’s markets to narrow next year as peak supply recedes. The company did not provide 2027 guidance. Fraker said Camden was still working through its budget process and would provide an outlook on its fourth-quarter earnings call.

About Camden Property Trust (NYSE:CPT)

Camden Property Trust NYSE: CPT is a real estate investment trust that owns, develops, acquires, and manages multifamily apartment communities. The company provides rental housing to individuals and families through a portfolio of communities offering a range of apartment layouts, amenities, and resident services.

Camden focuses primarily on high-growth markets in the Sun Belt, including metropolitan areas in Texas, Arizona, Colorado, Florida, Georgia, North Carolina, and Tennessee. Its communities are generally located in major urban and suburban markets and are managed through the company's in-house property management platform.

Founded in 1993 and headquartered in Houston, Texas, Camden Property Trust has expanded through apartment development, acquisitions, and ongoing property renovations.

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