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The primary market risk to which we believe we are exposed is interest rate risk, which may result from many factors, including government monetary and tax policies, domestic and international economic and political considerations, and other factors that are beyond our control.
−Removed: Decreases in interest rates may lead to additional competition for the acquisition of single-family homes and land for development, which may lead to future acquisitions being costlier and resulting in lower yields on single-family homes targeted for acquisition or land used in our development activities.
−Removed: Significant increases in interest rates may also have an adverse impact on our earnings if we are unable to acquire single-family homes with rental rates high enough to offset the increase in interest rates on our borrowings.
−Removed: During the third quarter of 2024, the Company entered into a new credit agreement with a $1.25 billion sustainability-linked revolving credit facility.
−Removed: All borrowings under our revolving credit facility bear interest at SOFR plus a 0.10% spread adjustment and a margin of 0.85% until the fully extended maturity date of July 2029 and are subject to a zero percent SOFR floor.
−Removed: As of December 31, 2024, the Company had no outstanding variable rate debt under its revolving credit facility and therefore no exposure to interest rate risk on its current borrowings.
+Added: Decreases in interest rates may lead to additional competition for the acquisition of land for development, which may lead to future acquisitions being costlier and resulting in lower yields on land used in our development activities.
+Added: Significant increases in interest rates may also have an adverse impact on our earnings if we are unable to rent our single-family properties with rental rates high enough to offset the increase in interest rates on our borrowings.
+Added: All borrowings under our revolving credit facility bear interest at the Secured Overnight Financing Rate (“SOFR”) plus a 0.10% spread adjustment and a margin of 0.85% until the fully extended maturity date of July 2029 and are subject to a zero percent SOFR floor.
+Added: During the year ended December 31, 2025, the Company borrowed $770.0 million and paid down $410.0 million on its revolving credit facility, resulting in $360.0 million of outstanding variable rate debt as of December 31, 2025.
We may incur additional variable rate debt in the future, including additional amounts that we may borrow under our revolving credit facility.
+Added: As of December 31, 2025, assuming no change in the outstanding balance of our existing variable rate debt, a hypothetical 100 basis point increase or decrease in the SOFR would increase or decrease our projected annual interest expense by approximately $3.6 million.
+Added: This analysis does not consider the effects of the reduced level of overall economic activity that could exist in such an environment.
+Added: Further, in the event of a change of such magnitude, we would consider taking actions to further mitigate our exposure to the change.
+Added: However, because of the uncertainty of the specific actions that would be taken and their possible effects, the sensitivity analysis assumes no changes in our capital structure.
As of December 31, 2025, the Company had approximately $4.8 billion of fixed rate debt and therefore the fair value of these instruments is affected by changes in market interest rates.
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See Part IV, “Item 15.
−Removed: Exhibit and Financial Statement Schedules.”
+Added: Exhibits and Financial Statement Schedules.”
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.