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Item 1. Financial Statements

2022-10-31 compared with 2022-08-01 · 226 added, 145 removed, 553 unchanged (40% of the section changed)

1 unchanged sentence

CENTERSPACE AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

ASSETS (Unaudited) (Audited)

Real estate investments

17 unchanged sentences

COMMITMENTS AND CONTINGENCIES (NOTE 10)

SERIES D PREFERRED UNITS (Cumulative convertible preferred units, $ 100 par value, 166 units issued and outstanding at June 30, 2022 and December 31, 2021, aggregate liquidation preference of $ 16,560 )

SERIES D PREFERRED UNITS (Cumulative convertible preferred units, $ 100 par value, 166 units issued and outstanding at September 30, 2022 and December 31, 2021, aggregate liquidation preference of $ 16,560 )

$ 16,560 $ 25,331

Series C Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, $ 25 per share liquidation preference, 3,881 shares issued and outstanding at June 30, 2022 and December 31, 2021, aggregate liquidation preference of $ 97,036 )

Series C Preferred Shares of Beneficial Interest (Cumulative redeemable preferred shares, no par value, $ 25 per share liquidation preference, 3,881 shares issued and outstanding at September 30, 2022 and December 31, 2021, aggregate liquidation preference of $ 97,036 )

93,530 93,530

Common Shares of Beneficial Interest (Unlimited authorization, no par value, 15,373 shares issued and outstanding at June 30, 2022 and 15,016 shares issued and outstanding at December 31, 2021)

Common Shares of Beneficial Interest (Unlimited authorization, no par value, 15,376 shares issued and outstanding at September 30, 2022 and 15,016 shares issued and outstanding at December 31, 2021)

1,209,732 1,157,255

10 unchanged sentences

(in thousands, except per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

18 unchanged sentences

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS $ ( 2,130 ) $ ( 11,099 ) $ ( 16,924 ) $ 2,358

NET EARNINGS (LOSS) PER COMMON SHARE – BASIC $ ( 0.30 ) $ 1.49 $ ( 0.97 ) $ 1.02

NET EARNINGS (LOSS) PER COMMON SHARE – DILUTED $ ( 0.30 ) $ 1.48 $ ( 0.97 ) $ 1.02

NET INCOME (LOSS) PER COMMON SHARE – BASIC $ ( 0.14 ) $ ( 0.79 ) $ ( 1.11 ) $ 0.17

NET INCOME (LOSS) PER COMMON SHARE – DILUTED $ ( 0.14 ) $ ( 0.79 ) $ ( 1.11 ) $ 0.12

See accompanying Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

Net income (loss) $ ( 770 ) $ ( 11,240 ) $ ( 15,076 ) $ 6,704

Other comprehensive income:

Other comprehensive income (loss):

Unrealized gain (loss) from derivative instrument — ( 70 ) 1,581 1,555

8 unchanged sentences

(in thousands, except per share data)

Six Months Ended June 30, 2021 PREFERRED

Nine Months Ended September 30, 2021 PREFERRED

SHARES NUMBER

5 unchanged sentences

INTERESTS TOTAL

Balance December 31, 2020 $ 93,530 13,027 $ 968,263 $ ( 427,681 ) $ ( 15,905 ) $ 54,616 $ 672,823

Balance at December 31, 2020 $ 93,530 13,027 $ 968,263 $ ( 427,681 ) $ ( 15,905 ) $ 54,616 $ 672,823

Net income (loss) attributable to controlling interests and noncontrolling interests 7,179 ( 955 ) 6,224

4 unchanged sentences

( 4,821 ) ( 4,821 )

Distributions - Series E preferred units ($ 0.322917 per unit)

( 585 ) ( 585 )

Share-based compensation, net of forfeitures 28 2,088 2,088

Sale of common shares, net 1,095 85,864 85,864

Issuance of Series E preferred units 44,905 172,608 217,513

Redemption of units for common shares 131 ( 2,815 ) 2,815 —

1 unchanged sentence

Other — ( 1,150 ) ( 113 ) ( 1,263 )

Balance June 30, 2021 $ 93,530 14,045 $ 1,033,940 $ ( 433,310 ) $ ( 12,064 ) $ 53,790 $ 735,886

Six Months Ended June 30, 2022

Balance December 31, 2021 $ 93,530 15,016 $ 1,157,255 $ ( 474,318 ) $ ( 4,435 ) $ 224,248 $ 996,280

Balance at September 30, 2021 $ 93,530 14,281 $ 1,092,130 $ ( 454,691 ) $ ( 5,784 ) $ 226,495 $ 951,680

Nine Months Ended September 30, 2022

Balance at December 31, 2021 $ 93,530 15,016 $ 1,157,255 $ ( 474,318 ) $ ( 4,435 ) $ 224,248 $ 996,280

Net income (loss) attributable to controlling interests and noncontrolling interests ( 12,103 ) ( 3,453 ) ( 15,556 )

1 unchanged sentence

Distributions - common shares and units ($2.19 per share and unit) ( 33,663 ) ( 2,169 ) ( 35,832 )

( 22,440 ) ( 1,454 ) ( 23,894 )

Distributions – Series C preferred shares ($ 1.2421875 per Series C share)

7 unchanged sentences

Redemption of units for cash ( 3,837 ) ( 3,837 )

Shares repurchased — ( 5 ) ( 359 ) — ( 359 )

Change in redemption value of Series D preferred units 8,771 8,771

1 unchanged sentence

Other — ( 254 ) ( 120 ) ( 374 )

Balance June 30, 2022 $ 93,530 15,373 $ 1,207,849 $ ( 511,552 ) $ ( 2,362 ) $ 223,153 $ 1,010,618

Balance at September 30, 2022 $ 93,530 15,376 $ 1,209,732 $ ( 524,905 ) $ ( 2,158 ) $ 220,087 $ 996,286

See accompanying Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

(in thousands, except per share data)

Three Months Ended June 30, 2021 PREFERRED

Three Months Ended September 30, 2021 PREFERRED

SHARES NUMBER

5 unchanged sentences

INTERESTS TOTAL

Balance March 31, 2021 $ 93,530 13,220 $ 980,453 $ ( 443,409 ) $ ( 12,798 ) $ 53,676 $ 671,452

Balance at June 30, 2021 $ 93,530 14,045 $ 1,033,940 $ ( 433,310 ) $ ( 12,064 ) $ 53,790 $ 735,886

Net income (loss) attributable to controlling interests and noncontrolling interests ( 9,492 ) ( 1,908 ) ( 11,400 )

4 unchanged sentences

( 1,607 ) ( 1,607 )

Distributions - Series E preferred units ($ 0.322917 per unit)

( 585 ) ( 585 )

Share-based compensation, net of forfeitures 1 600 600

Sale of common shares, net 199 19,508 19,508

Issuance of Series E preferred units 44,905 172,608 217,513

Redemption of units for common shares 36 ( 3,233 ) 3,233 —

1 unchanged sentence

Other — ( 27 ) ( 34 ) ( 61 )

Balance June 30, 2021 $ 93,530 14,045 $ 1,033,940 $ ( 433,310 ) $ ( 12,064 ) $ 53,790 $ 735,886

Three Months Ended June 30, 2022

Balance March 31, 2022 $ 93,530 15,366 $ 1,203,685 $ ( 495,732 ) $ ( 2,550 ) $ 226,973 $ 1,025,906

Balance at September 30, 2021 $ 93,530 14,281 $ 1,092,130 $ ( 454,691 ) $ ( 5,784 ) $ 226,495 $ 951,680

Three Months Ended September 30, 2022

Balance at June 30, 2022 $ 93,530 15,373 $ 1,207,849 $ ( 511,552 ) $ ( 2,362 ) $ 223,153 $ 1,010,618

Net income (loss) attributable to controlling interests and noncontrolling interests ( 523 ) ( 407 ) ( 930 )

9 unchanged sentences

Redemption of units for cash ( 607 ) ( 607 )

Shares repurchased — ( 5 ) ( 359 ) — ( 359 )

Change in redemption value of Series D preferred units 2,067 2,067

Other — ( 78 ) ( 36 ) ( 114 )

Balance June 30, 2022 $ 93,530 15,373 $ 1,207,849 $ ( 511,552 ) $ ( 2,362 ) $ 223,153 $ 1,010,618

Balance at September 30, 2022 $ 93,530 15,376 $ 1,209,732 $ ( 524,905 ) $ ( 2,158 ) $ 220,087 $ 996,286

See accompanying Notes to Condensed Consolidated Financial Statements.

CENTERSPACE AND SUBSIDIARIES

1 unchanged sentence

(in thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss) $ ( 15,076 ) $ 6,704

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Adjustments to reconcile net income (loss) to net cash provided by (used by) operating activities:

Depreciation and amortization, including amortization of capitalized loan costs 80,104 62,527

8 unchanged sentences

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from repayment of mortgage loans and notes receivable 353 139

Increase in mortgages and notes receivable — ( 17,498 )

5 unchanged sentences

CASH FLOWS FROM FINANCING ACTIVITIES

Net proceeds from mortgages payable — 196,725

Principal payments on mortgages payable ( 27,426 ) ( 27,650 )

2 unchanged sentences

Net proceeds from notes payable — 174,544

Principal payments on notes payable — ( 145,000 )

Payment for termination of interest rate swap ( 3,209 ) ( 3,804 )

Net proceeds from issuance of common shares 31,499 85,864

Repurchase of common shares ( 359 ) —

Redemption of partnership units ( 3,837 ) —

17 unchanged sentences

Real estate assets acquired through issuance of operating partnership units 22,882 —

Real estate assets acquired through issuance of Series E preferred units — 217,513

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Cash paid for interest $ 21,856 $ 20,050

See accompanying Notes to Condensed Consolidated Financial Statements.

CENTERSPACE AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in thousands)

Balance sheet description June 30, 2022 December 31, 2021 June 30, 2021

Balance sheet description September 30, 2022 December 31, 2021 September 30, 2021

Cash and cash equivalents $ 14,957 $ 31,267 $ 20,816

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended June 30, 2022 and 2021

September 30, 2022

NOTE 1 • ORGANIZATION

Centerspace, collectively with its consolidated subsidiaries (“Centerspace,” “the Company,” “we,” “us,” or “our”), is a North Dakota real estate investment trust (“REIT”) focused on the ownership, management, acquisition, redevelopment, and development of apartment communities.

As of June 30, 2022, Centerspace owned interests in 83 apartment communities consisting of 14,838 apartment homes.

As of September 30, 2022, Centerspace owned interests in 84 apartment communities consisting of 15,064 apartment homes.

NOTE 2 • BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

16 unchanged sentences

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH

As of June 30, 2022 and December 31, 2021, restricted cash consisted primarily of real estate deposits and escrows held by lenders for real estate taxes, insurance, and capital additions.

As of September 30, 2022 and December 31, 2021, restricted cash consisted primarily of deposits for real estate acquisitions and escrows held by lenders for real estate taxes, insurance, and capital additions.

As a lessor, Centerspace primarily leases multifamily apartment homes which qualify as operating leases with terms that are generally one year or less.

8 unchanged sentences

The combined components are included in lease income and are accounted for under ASC 842.

The aggregate amount of future scheduled lease income on commercial operating leases, excluding any variable lease income and non-lease components, as of June 30, 2022, was as follows:

The aggregate amount of future scheduled lease income on commercial operating leases, excluding any variable lease income and non-lease components, as of September 30, 2022, was as follows:

(in thousands)

6 unchanged sentences

Centerspace recognizes revenue for these rental related items not included as a component of a lease as earned.

The following table presents the disaggregation of revenue streams for the three and six months ended June 30, 2022 and 2021:

The following table presents the disaggregation of revenue streams for the three and nine months ended September 30, 2022 and 2021:

(in thousands)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

Revenue Stream Applicable Standard 2022 2021 2022 2021

4 unchanged sentences

In addition to lease income and other property revenue, the Company recognizes gains or losses on the sale of real estate when the criteria for derecognition of an asset are met, including when (1) a contract exists and (2) the buyer obtained control of the nonfinancial asset that was sold.

For the nine months ended September 30, 2022 and 2021, we recognized $ 27,000 and $ 26.8 million, respectively, as a gain on the sale of real estate and other assets.

IMPAIRMENT OF LONG-LIVED ASSETS

6 unchanged sentences

Reducing planned property holding periods may increase the likelihood of recording impairment losses.

During the three and six months ended June 30, 2022 and 2021, the Company recorded no impairment charges.

During the three and nine months ended September 30, 2022 and 2021, the Company recorded no impairment charges.

MORTGAGE LOANS RECEIVABLE AND NOTES RECEIVABLE

The Company has a tax increment financing note receivable (“TIF”) with a principal balance of $ 6.3 million and $ 6.4 million at June 30, 2022 and December 31, 2021, respectively, which appears within other assets in the Condensed Consolidated Balance Sheets.

The Company has a tax increment financing note receivable (“TIF”) with a principal balance of $ 6.1 million and $ 6.4 million at September 30, 2022 and December 31, 2021, respectively, which appears within other assets in the Condensed Consolidated Balance Sheets.

The note bears an interest rate of 4.5 % with payments due in February and August of each year.

1 unchanged sentence

The construction and mezzanine loans bore and accrued interest at 4.5 % and 11.5 %, respectively.

The Company exercised its option to purchase the apartment community in exchange for the loans and cash, during the six months ended June 30, 2022.

As of June 30, 2022, the loans had no remaining balance.

The Company exercised its option to purchase the apartment community in exchange for the loans and cash, during the nine months ended September 30, 2022.

As of September 30, 2022, the loans had no remaining balance.

As of December 31, 2021, the Company had fully funded the $ 29.9 million construction loan and $ 13.4 million of the mezzanine loan, both of which appear within mortgage loans receivable in the Condensed Consolidated Balance Sheets.

4 unchanged sentences

NOTE 3 • EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of common shares of beneficial interest (“common shares”) outstanding during the period.

Basic earnings per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares of beneficial interest (“common shares”) outstanding during the period.

Centerspace has issued restricted stock units (“RSUs”) and incentive stock options (“ISOs”) under the 2015 Incentive Plan, Series D Convertible Preferred Units (“Series D preferred units”), and Series E Convertible Preferred Units (“Series E preferred units”), which could have a dilutive effect on the earnings per share upon exercise of the RSUs or ISOs or upon conversion of the Series D or Series E preferred units (refer to Note 4 for further discussion of the Series D and the Series E preferred units).

2 unchanged sentences

Upon the exercise of Exchange Rights, and in Centerspace’s sole discretion, it may issue common shares in exchange for Units on a one -for-one basis.

For the three months ended June 30, 2022, operating partnership units of 995,000 , Series D preferred units of 228,000 , Series E preferred units of 2.2 million, time-based RSUs of 9,000 , weighted average stock options of 39,000 , and performance-based RSUs of 30,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the three months ended June 30, 2021, weighted average stock options of 44,000 and performance-based RSUs of 31,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the six months ended June 30, 2022, operating partnership units of 978,000 , Series D preferred units of 228,000 , Series E preferred units of 2.2 million, time-based RSUs of 11,000 , weighted average stock options of 46,000 , and performance-based RSUs of 30,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the six months ended June 30, 2021, weighted average stock options of 44,000 and performance-based RSUs of 28,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

The following table presents a reconciliation of the numerator and denominator used to calculate basic and diluted earnings per share reported in the Condensed Consolidated Financial Statements for the three and six months ended June 30, 2022 and 2021.

For the three months ended September 30, 2022, operating partnership units of 984,000 , Series D preferred units of 228,000 , as converted, Series E preferred units of 2.2 million, time-based RSUs of 7,000 , weighted average stock options of 23,000 , and performance-based RSUs of 30,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the three months ended September 30, 2021, operating partnership units of 865,000 , Series D preferred units of 228,000 , as converted, Series E preferred units of 705,000 , time-based RSUs of 13,000 , weighted average stock options of 46,000 , and performance-based RSUs of 32,000 were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the nine months ended September 30, 2022, operating partnership units of 980,000 , Series D preferred units of 228,000 , as converted, Series E preferred units of 2.2 million, time-based RSUs of 10,000 , weighted average stock options of 38,000 , and performance-based RSUs of 33,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the nine months ended September 30, 2021, performance-based RSUs of 32,000 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

(in thousands, except per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

8 unchanged sentences

Effect of Series D preferred units — — — 228

Effect of Series E preferred units — — — 239

Effect of dilutive restricted stock units and stock options — — — 32

Denominator for diluted earnings per share 15,373 14,065 15,280 14,917

NET EARNINGS (LOSS) PER COMMON SHARE – BASIC $ ( 0.30 ) $ 1.49 $ ( 0.97 ) $ 1.02

NET EARNINGS (LOSS) PER COMMON SHARE – DILUTED $ ( 0.30 ) $ 1.48 $ ( 0.97 ) $ 1.02

NET INCOME (LOSS) PER COMMON SHARE – BASIC $ ( 0.14 ) $ ( 0.79 ) $ ( 1.11 ) $ 0.17

NET INCOME (LOSS) PER COMMON SHARE – DILUTED $ ( 0.14 ) $ ( 0.79 ) $ ( 1.11 ) $ 0.12

NOTE 4 • EQUITY AND MEZZANINE EQUITY

Operating Partnership Units.

The Operating Partnership had 995,000 and 832,000 outstanding Units at June 30, 2022 and December 31, 2021, respectively.

During the six months ended June 30, 2022, we issued 209,000 Units as partial consideration for the acquisition of three apartment communities.

The Operating Partnership had 980,000 and 832,000 outstanding Units at September 30, 2022 and December 31, 2021, respectively.

During the nine months ended September 30, 2022, we issued 209,000 Units as partial consideration for the acquisition of three apartment communities.

Exchange Rights .

Centerspace redeemed Units in exchange for common shares in connection with Unitholders exercising their exchange rights during the three and six months ended June 30, 2022 and 2021 as detailed in the table below.

Centerspace redeemed Units in exchange for common shares in connection with Unitholders exercising their exchange rights during the three and nine months ended September 30, 2022 and 2021 as detailed in the table below.

(in thousands)

Three Months Ended June 30, Number of Units Net Book Basis

2022 1 $ ( 13 )

Three Months Ended September 30, Number of Units Net Book Basis

2021 36 $ ( 3,233 )

Six Months Ended June 30,

Nine Months Ended September 30,

2022 19 $ 831

2021 131 $ ( 2,815 )

Pursuant to the exercise of exchange rights, the Company redeemed Units for cash during the three and six months ended June 30, 2022 and 2021 as detailed in the table below.

Pursuant to the exercise of exchange rights, the Company redeemed Units for cash during the three and nine months ended September 30, 2022 and 2021 as detailed in the table below.

(in thousands, except per Unit data)

Three Months Ended June 30, Number of Units Aggregate Cost Average Price Per Unit

Three Months Ended September 30, Number of Units Aggregate Cost Average Price Per Unit

2022 7 $ 607 $ 81.18

Six Months Ended June 30,

2021 — $ — $ —

Nine Months Ended September 30,

2022 42 $ 3,837 $ 90.93

2021 — $ — $ —

Series E Preferred Units (Noncontrolling Interests).

1 unchanged sentence

The Series E preferred unit holders receive a preferred distribution at the rate of 3.875 % per year.

Each Series E preferred unit is convertible, at the holder’s option, into 1.2048 Units.

Each Series E

preferred unit is convertible, at the holder’s option, into 1.2048 Units.

The Series E preferred units have an aggregate liquidation preference of $ 181.4 million.

The holders of the Series E preferred units do not have voting rights and are required to hold the units for one year before they may elect to convert.

The holders of the Series E preferred units do not have voting rights.

Common Shares and Equity Awards .

Common shares outstanding on June 30, 2022 and December 31, 2021, totaled 15.4 million and 15.0 million, respectively.

There were 5,538 and 24,297 shares issued upon the vesting of equity awards under the 2015 Incentive Plan during the three and six months ended June 30, 2022, respectively, with a total grant-date fair value of $ 397,000 and $ 619,000 , respectively.

There were 23,385 and 26,186 shares issued upon the vesting of equity awards under the 2015 Incentive Plan during the three and six months ended June 30, 2021, respectively, with a total grant-date fair value of $ 750,000 and $ 914,000 , respectively.

Common shares outstanding on September 30, 2022 and December 31, 2021, totaled 15.4 million and 15.0 million, respectively.

There were 199 and 24,496 shares issued upon the vesting of equity awards under the 2015 Incentive Plan during the three and nine months ended September 30, 2022, respectively, with a total grant-date fair value of $ 18,000 and $ 637,000 , respectively.

There were 578 and 26,764 shares issued upon the vesting of equity awards under the 2015 Incentive Plan during the three and nine months ended September 30, 2021, respectively, with a total grant-date fair value of $ 32,000 and $ 946,000 , respectively.

These shares vested based on performance and service criteria.

4 unchanged sentences

The proceeds from the sale of common shares under the 2021 ATM Program may be used for general corporate purposes, including the funding of acquisitions, construction or mezzanine loans, community renovations, and the repayment of indebtedness.

The table below provides details on the sale of common shares during the three and six months ended June 30, 2022 and 2021 under both the 2019 and 2021 ATM Programs.

As of June 30, 2022, common shares having an aggregate offering price of up to $ 126.6 million remained available under the 2021 ATM Program.

The table below provides details on the sale of common shares during the three and nine months ended September 30, 2022 and 2021 under both the 2019 and 2021 ATM Programs.

As of September 30, 2022, common shares having an aggregate offering price of up to $ 126.6 million remained available under the 2021 ATM Program.

(in thousands, except per share amounts)

Three Months Ended June 30, Number of Common Shares Net Consideration (1)

Three Months Ended September 30, Number of Common Shares Net Consideration (1)

Average Net Price Per Share

1 unchanged sentence

2021 199 $ 19,632 $ 98.58

Six Months Ended June 30,

Nine Months Ended September 30,

2022 321 $ 31,732 $ 98.89

2021 1,095 $ 86,127 $ 78.63

(1) Total consideration is net of $ 338 in commissions and issuance costs during the six months ended June 30, 2022 and $ 528 and $ 709 for the three and six months ended June 30, 2021, respectively.

(1) Total consideration is net of $ 338 in commissions and issuance costs during the nine months ended September 30, 2022 and $ 299 and $ 1.0 million for the three and nine months ended September 30, 2021, respectively.

Share Repurchase Program.

3 unchanged sentences

The specific timing and amount of repurchases will vary based on available capital resources or other financial and operational performance, market conditions, securities law limitations, and other factors.

During the six months ended June 30, 2022, the Company had no share repurchases under this program.

As of June 30, 2022, the Company had $ 50.0 million remaining authorized for purchase under this program.

The table below provides details on the shares repurchased during the three and nine months ended September 30, 2022.

As of September 30, 2022, the Company had $ 49.6 million remaining authorized for purchase under this program.

Refer to Note 12 for repurchases made subsequent to September 30, 2022.

(in thousands, except per share amounts)

Number of Common Shares Total Consideration (1)

Average Net Price Per Share (1)

Three and Nine Months Ended September 30, 2022

5 $ 359 $ 65.97

(1) Amount includes commissions.

Series C Preferred Shares.

Series C preferred shares outstanding were 3.9 million shares at June 30, 2022 and December 31, 2021.

Series C preferred shares outstanding were 3.9 million shares at September 30, 2022 and December 31, 2021.

The Series C preferred shares are nonvoting and redeemable for cash at $ 25.00 per share at Centerspace’s option after October 2, 2022.

2 unchanged sentences

Series D Preferred Units (Mezzanine Equity).

Series D preferred units outstanding were 165,600 preferred units at June 30, 2022 and December 31, 2021.

Series D preferred units outstanding were 165,600 preferred units at September 30, 2022 and December 31, 2021.

The Series D preferred units have a par value price of $ 100 per preferred unit.

The Series D preferred unit holders receive a preferred distribution at the rate of 3.862 % per year.

The Series D preferred units have a put option which allows the holder to redeem any or all of the Series D preferred units for cash equal to the issuance price.

The Series D preferred units have a put option which allows the holder to redeem any or all of the Series D preferred units for cash equal to the

issuance price.

Each Series D preferred unit is convertible, at the holder’s option, into 1.37931 Units.

4 unchanged sentences

NOTE 5 • DEBT

As of June 30, 2022, 52 apartment communities were not encumbered by mortgages and were available to provide credit support for the unsecured borrowings.

The Company’s primary unsecured credit facility (“unsecured credit facility”) is a

revolving, multi-bank line of credit, with the Bank of Montreal serving as administrative agent.

The following is a summary of our secured and unsecured debt at September 30, 2022 and December 31, 2021.

(in thousands)

September 30, 2022 December 31, 2021

Carrying Amount Weighted Average Interest Rate Carrying Amount Weighted Average Interest Rate Weighted Average Maturity in Years at September 30, 2022

Lines of credit (1)

$ 171,500 3.28 % $ 76,000 2.74 % 3.00

Unsecured senior notes (2)(5)

300,000 3.12 % 300,000 3.12 % 7.88

Unsecured debt 471,500 376,000 6.11

Mortgages payable - Fannie Mae credit facility (5)

198,850 2.78 % 198,850 2.78 % 8.82

Mortgages payable - other (3)(5)

300,956 3.85 % 284,934 3.81 % 5.03

Total debt (4)

$ 971,306 3.45 % $ 859,784 3.26 % 6.33

(1) The interest rate swap was terminated in February 2022.

Refer to Note 6 - Derivative Instruments for additional information.

Interest rates on lines of credit are variable.

(2) Included within notes payable on the Condensed Consolidated Balance Sheets.

(3) Represents apartment communities encumbered by mortgages;

15 at September 30, 2022 and 14 at December 31, 2021.

(4) Excludes deferred financing costs and premiums or discounts.

(5) Interest rate is fixed.

As of September 30, 2022, 53 apartment communities were not encumbered by mortgages and were available to provide credit support for the unsecured borrowings.

The Company’s primary unsecured credit facility (“unsecured credit facility”) is a revolving, multi-bank line of credit, with the Bank of Montreal serving as administrative agent.

The line of credit has total commitments and borrowing capacity of $ 250.0 million, based on the value of unencumbered properties.

As of June 30, 2022, the additional borrowing availability was $ 177.0 million beyond the $ 73.0 million drawn.

As of September 30, 2022, the additional borrowing availability was $ 78.5 million beyond the $ 171.5 million drawn.

This unsecured credit facility was amended on September 30, 2021 to extend the maturity date to September 2025 and to provide for an accordion option to increase borrowing capacity up to $ 400.0 million.

1 unchanged sentence

The unsecured credit facility and unsecured senior notes are subject to customary financial covenants and limitations.

The Company believes that it was in compliance with all such financial covenants and limitations as of June 30, 2022.

The Company believes that it was in compliance with all such financial covenants and limitations as of September 30, 2022.

In January 2021, Centerspace amended and expanded its private shelf agreement with PGIM, Inc., an affiliate of Prudential Financial, Inc., and certain affiliates of PGIM, Inc.

1 unchanged sentence

In September 2021, the Company entered into a note purchase agreement for the issuance of $ 125.0 million senior unsecured promissory notes, of which $ 25.0 million was issued under the private shelf agreement with PGIM.

Under the private shelf agreement with PGIM, the Company has issued $ 200.0 million unsecured senior notes with $ 25.0 million remaining available as of June 30, 2022.

Under the private shelf agreement with PGIM, the Company has issued $ 200.0 million unsecured senior notes with $ 25.0 million remaining available as of September 30, 2022.

The following table shows the notes issued under both private shelf agreements.

11 unchanged sentences

The notes are interest-only, with varying maturity dates of 7 , 10 , and 12 years, and a blended, weighted average interest rate of 2.78 %.

As of June 30, 2022, the FMCF had a balance of $ 198.9 million.

As of September 30, 2022 and December 31, 2021, the FMCF had a balance of $ 198.9 million.

The FMCF is included within mortgages payable on the Condensed Consolidated Balance Sheets.

As of June 30, 2022, Centerspace owned 15 apartment communities that served as collateral for mortgage loans, in addition to the apartment communities secured by the FMCF.

As of September 30, 2022, Centerspace owned 15 apartment communities that served as collateral for mortgage loans, in addition to the apartment communities secured by the FMCF.

All of these mortgage loans were non-recourse to the Company other than for standard carve-out obligations.

As of June 30, 2022, the Company believes that there were no material defaults or instances of noncompliance in regards to any of these mortgages payable.

As of September 30, 2022, the Company believes that there were no material defaults or instances of noncompliance in regards to any of these mortgages payable.

Centerspace also has a $ 6.0 million operating line of credit.

1 unchanged sentence

This operating line matures on November 29, 2022, with pricing based on a market spread plus the one-month LIBOR index rate.

The following table summarizes indebtedness.

(in thousands)

June 30, 2022 December 31, 2021 Weighted Average Maturity in Years at June 30, 2022

Lines of credit $ 73,000 $ 76,000 3.25

Unsecured senior notes (1)

300,000 300,000 8.13

Unsecured debt 373,000 376,000 7.18

Mortgages payable - Fannie Mae credit facility 198,850 198,850 9.07

Mortgages payable - other 302,360 284,934 5.47

Total debt $ 874,210 $ 859,784 6.96

Weighted average interest rate on lines of credit (rate with swap) (2)

2.80 % 2.74 %

Weighted average interest rate on unsecured senior notes 3.12 % 3.12 %

Weighted average interest rate on mortgages payable - Fannie Mae credit facility 2.78 % 2.78 %

Weighted average interest rate on mortgages payable - other 3.85 % 3.81 %

Weighted average interest rate on total debt 3.27 % 3.26 %

(1) Included within notes payable on the Condensed Consolidated Balance Sheets.

(2) The interest rate swap was terminated in February 2022.

Refer to Note 6 - Derivative Instruments for additional information.

The aggregate amount of required future principal payments as of June 30, 2022, was as follows:

The aggregate amount of required future principal payments as of September 30, 2022, was as follows:

(in thousands)

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To accomplish this objective, the Company primarily used interest rate swap contracts to fix variable interest rate debt.

Changes in the fair value of derivatives designated and that qualified as cash flow hedges were recorded in accumulated other comprehensive income (“OCI”).

Changes in the fair value of derivatives designated and that qualified as cash flow hedges were recorded in accumulated other comprehensive income (loss) (“OCI”).

Amounts recorded in accumulated other comprehensive income will be reclassified to interest expense in the periods in which interest payments are incurred on variable rate debt.

During the next twelve months, the Company estimates an additional $ 724,000 will be reclassified as an increase to interest expense.

In February 2022, the Company paid $ 3.2 million to terminate its $ 75.0 million interest rate swap and its $ 70.0 million forward swap.

As of September 30, 2022 the Company had no remaining interest rate swaps.

Derivatives not designated as hedges were not speculative and were used to manage the Company’s exposure to interest rate movements and other identified risks but did not meet the strict hedge accounting requirements.

Changes in fair value of derivatives not designated in hedging relationships were recorded directly to earnings within other income (loss) in the Condensed Consolidated Statement of Operations.

During the six months ended June 30, 2022, the Company recorded a gain of $ 582,000 related to the interest rate swap not designated in a hedging relationship, prior to its termination.

In February 2022, the Company paid $ 3.2 million to terminate its $ 75.0 million interest rate swap and its $ 70.0 million forward swap.

As of June 30, 2022 the Company had no remaining interest rate swaps.

During the nine months ended September 30, 2022 and 2021, the Company recorded a gain of $ 582,000 and $ 60,000 , respectively, related to the interest rate swap not designated in a hedging relationship, prior to its termination.

During the three months ended September 30, 2021, the Company paid $ 3.8 million to terminate its $ 50.0 million interest rate swap and its $ 70.0 million interest rate swap.

The Company accelerated the reclassification of a $ 5.4 million loss from OCI into other income (loss) in the Condensed Consolidated Statement of Operations as a result of the hedged transactions becoming probable not to occur.

As of December 31, 2021 , Centerspace had one interest rate swap contract designated as a cash flow hedge of interest rate risk with a notional amount of $ 75.0 million to fix the interest rate on the line of credit.

The Company also had one additional interest rate swap with an effective date of January 31, 2023 and a notional amount of $ 70.0 million which was not designated as a hedge in a qualifying hedging relationship.

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021 .

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021 .

(in thousands)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Balance Sheet Location Fair Value Fair Value

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Total derivative instruments not designated as hedging instruments - interest rate swaps Accounts Payable and Accrued Expenses $ — $ 1,097

The table below presents the effect of the Company’s derivative financial instruments on the Condensed Consolidated Statements of Operations as of June 30, 2022 and 2021.

The table below presents the effect of the Company’s derivative financial instruments on the Condensed Consolidated Statements of Operations as of September 30, 2022 and 2021.

(in thousands)

Gain (Loss) Recognized in OCI Location of Gain (Loss) Reclassified from Accumulated OCI into Income Gain (Loss) Reclassified from Accumulated OCI into Income

Three months ended June 30, 2022 2021 2022 2021

Three months ended September 30, 2022 2021 2022 2021

Total derivatives in cash flow hedging relationships - Interest rate contracts $ — $ ( 70 ) Interest expense $ ( 204 ) $ ( 940 )

Six months ended June 30,

Nine months ended September 30,

Total derivatives in cash flow hedging relationships - Interest rate contracts $ 1,581 $ 1,555 Interest expense $ ( 696 ) $ ( 3,156 )

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Total Level 1 Level 2 Level 3

June 30, 2022

September 30, 2022

Notes receivable $ 5,865 — — $ 5,865

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(in thousands)

Fair Value Measurement at June 30, Other Gains (Losses) Interest Income Total Changes in Fair Value Included in Current-Period Earnings

Six months ended June 30, 2022

Fair Value Measurement Other Gains (Losses) Interest Income Total Changes in Fair Value Included in Current-Period Earnings

Nine months ended September 30, 2022

Notes receivable $ 5,865 $ 11 $ 600 $ 611

Six months ended June 30, 2021

Nine months ended September 30, 2021

Mortgage loans and notes receivable $ 48,364 $ 11 $ 1,759 $ 1,770

As of June 30, 2022 and December 31, 2021, Centerspace had an investment of $ 966,000 and $ 903,000 , respectively, in a real estate technology venture consisting of privately held entities that develop technology related to the real estate industry.

This investment is measured at net asset value (“NAV”) as a practical expedient under ASC 820.

As of June 30, 2022, the Company had unfunded commitments of $ 1.0 million.

As of September 30, 2022 and December 31, 2021, Centerspace had investments totaling $ 1.4 million and $ 903,000 , respectively, in real estate technology venture funds consisting of privately held entities that develop technology related to the real estate industry.

The investments are measured at net asset value (“NAV”) as a practical expedient under ASC 820.

As of September 30, 2022, the Company had total unfunded commitments of $ 1.6 million.

Fair Value Measurements on a Nonrecurring Basis

There were no non-financial assets or liabilities measured at fair value on a nonrecurring basis at June 30, 2022 and December 31, 2021.

There were no non-financial assets or liabilities measured at fair value on a nonrecurring basis at September 30, 2022 and December 31, 2021.

Financial Assets and Liabilities Not Measured at Fair Value

The fair value of unsecured senior notes and mortgages payable are estimated based on the discounted cash flows of the loans using market research and management estimates of comparable interest rates, excluding any prepayment penalties (Level 3).

The estimated fair values of the Company’s financial instruments as of June 30, 2022 and December 31, 2021, respectively, are as follows:

The estimated fair values of the Company’s financial instruments as of September 30, 2022 and December 31, 2021, respectively, are as follows:

(in thousands)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Carrying Amount Fair Value Carrying Amount Fair Value

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NOTE 8 • ACQUISITIONS AND DISPOSITIONS

Centerspace had no acquisitions during the three months ended June 30, 2022 and 2021.

The acquisitions during the six months ended June 30, 2022 and 2021 are detailed below.

Six Months Ended June 30, 2022

Centerspace acquired a new apartment community for $ 95.0 million during the three months ended September 30, 2022 compared to acquisitions of $ 359.9 million during the three months ended September 30, 2021.

The acquisitions during the nine months ended September 30, 2022 and 2021 are detailed below.

Nine Months Ended September 30, 2022

Acquired (in thousands)

Cost Form of Consideration Investment Allocation

Form of Consideration Investment Allocation

Acquisitions Cash Units (2)

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January 26, 2022 46,619 3,343 — 43,276 1,915 42,754 1,950 —

215 homes - Lyra Apartments - Centennial, CO

September 30, 2022 95,000 95,000 — — 6,473 86,149 2,378 —

Total Acquisitions $ 211,874 $ 104,093 $ 22,882 $ 84,899 $ 13,812 $ 192,229 $ 7,050 $ ( 1,217 )

(1) Excludes transaction costs.

(2) Fair value of operating partnership units issued on acquisition.

2 unchanged sentences

(4) Debt discount on assumed mortgage.

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

Acquired (in thousands)

Cost Form of Consideration Investment Allocation

Acquisitions Cash Land Building Intangible

Form of Consideration Investment Allocation

Acquisitions Cash Units (2)

Land Building Intangible

Assets Other (4)

256 homes - Union Pointe - Longmont, CO

January 6, 2021 $ 76,900 $ 76,900 $ — $ — $ 5,727 $ 69,966 $ 1,207 $ —

During the three and six months ended June 30, 2022, Centerspace disposed of no real estate compared to $ 60.0 million in the three and six months ended June 30, 2021.

The dispositions during the six months ended June 30, 2021 are detailed below.

Six Months Ended June 30, 2021

120 homes - Bayberry Place - Minneapolis, MN

September 1, 2021 16,673 898 9,855 5,920 1,807 14,113 753 —

251 homes - Burgandy & Hillsboro Court - Minneapolis, MN

September 1, 2021 35,569 2,092 22,542 10,935 2,834 31,148 1,587 —

97 homes - Venue on Knox - Minneapolis, MN

September 1, 2021 18,896 500 11,375 7,021 3,438 14,743 715 —

120 homes - Gatewood - St.

September 1, 2021 7,781 378 3,388 4,015 327 6,858 596 —

84 homes - Grove Ridge - Minneapolis, MN

September 1, 2021 12,060 121 8,579 3,360 1,250 10,271 539 —

119 homes - The Legacy - St.

September 1, 2021 10,560 229 5,714 4,617 412 9,556 592 —

151 homes - New Hope Garden & Village - Minneapolis, MN

September 1, 2021 15,006 1,435 10,812 2,759 1,603 12,578 825 —

330 homes - Palisades - Minneapolis, MN

September 1, 2021 53,354 2,884 30,470 20,000 6,919 46,577 2,211 ( 2,353 )

96 homes - Plymouth Pointe - Minneapolis, MN

September 1, 2021 14,450 370 9,061 5,019 1,042 12,809 599 —

93 homes - Pointe West - St.

September 1, 2021 7,558 91 3,605 3,862 246 6,849 463 —

301 homes - River Pointe - Minneapolis MN

September 1, 2021 38,348 2,249 21,653 14,446 3,346 33,117 1,885 —

70 homes - Southdale Parc - Minneapolis, MN

September 1, 2021 9,670 165 7,907 1,598 1,569 7,740 361 —

62 homes - Portage - Minneapolis, MN

September 1, 2021 9,171 323 5,588 3,260 2,133 6,685 353 —

200 homes - Windsor Gates - Minneapolis, MN

September 1, 2021 22,231 1,122 12,080 9,029 2,140 18,943 1,148 —

136 homes - Wingate - Minneapolis, MN

September 1, 2021 15,784 723 10,246 4,815 1,480 13,530 774 —

178 homes - Woodhaven - Minneapolis, MN

September 1, 2021 25,009 1,682 15,200 8,127 3,940 20,080 989 —

288 homes - Woodland Pointe - Minneapolis, MN

September 1, 2021 47,796 437 29,438 17,921 5,367 40,422 2,007 —

Total Acquisitions $ 436,816 $ 92,599 $ 217,513 $ 126,704 $ 45,580 $ 375,985 $ 17,604 $ ( 2,353 )

(1) Includes $ 36.1 million for additional fair value of Series E preferred units for the September 1, 2021 portfolio acquisition

(2) Fair value of Series E preferred units at the acquisition date

(3) Payoff of debt or assumption of seller's debt upon closing

(4) Debt discount on assumed mortgage

During the nine months ended September 30, 2022, Centerspace did not dispose of any real estate.

The dispositions during the nine months ended September 30, 2021 are detailed below.

Nine Months Ended September 30, 2021

(in thousands)

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Total Dispositions $ 60,000 $ 33,160 $ 26,840

NOTE 9 • SEGMENT REPORTING

NOTE 9 • SEGMENTS

Centerspace operates in a single reportable segment which includes the ownership, management, development, redevelopment, and acquisition of apartment communities.

6 unchanged sentences

The members of the executive management team are the chief operating decision-makers.

This team measures the performance of the reportable segment based on net operating income (“NOI”), a non-GAAP measure, which the Company defines as total

real estate revenues less property operating expenses, including real estate taxes.

This team measures the performance of the reportable segment based on net operating income (“NOI”), a non-GAAP measure, which the Company defines as total real estate revenues less property operating expenses, including real estate taxes.

Centerspace believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by depreciation, amortization, financing, property management overhead, casualty losses, and general and administrative expense.

NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common shareholders, or cash flow from operating activities as a measure of financial performance.

The following tables present NOI for the three and six months ended June 30, 2022 and 2021, respectively, along with reconciliations to net income in the Condensed Consolidated Financial Statements.

NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.

The following tables present NOI for the three and nine months ended September 30, 2022 and 2021, respectively, along with reconciliations to net income in the Condensed Consolidated Financial Statements.

Segment assets are also reconciled to total assets as reported in the Condensed Consolidated Financial Statements.

(in thousands)

Three Months Ended June 30, 2022 Multifamily All Other Total

Three Months Ended September 30, 2022 Multifamily All Other Total

Revenue $ 64,404 $ 1,034 $ 65,438

5 unchanged sentences

General and administrative expenses ( 4,519 )

Gain (loss) on sale of real estate and other investments 27

Interest expense ( 7,871 )

2 unchanged sentences

(in thousands)

Three Months Ended June 30, 2021 Multifamily All Other Total

Three Months Ended September 30, 2021 Multifamily All Other Total

Revenue $ 49,088 $ 1,325 $ 50,413

5 unchanged sentences

General and administrative expenses ( 4,279 )

Gain (loss) on sale of real estate and other investments 26,840

Interest expense ( 7,302 )

2 unchanged sentences

(in thousands)

Six Months Ended June 30, 2022 Multifamily All Other Total

Nine Months Ended September 30, 2022 Multifamily All Other Total

Revenue $ 186,002 $ 2,866 $ 188,868

10 unchanged sentences

(in thousands)

Six Months Ended June 30, 2021 Multifamily All Other Total

Nine Months Ended September 30, 2021 Multifamily All Other Total

Revenue $ 138,287 $ 5,430 $ 143,717

10 unchanged sentences

Segment Assets and Accumulated Depreciation

Segment assets are summarized as follows as of June 30, 2022, and December 31, 2021, respectively, along with reconciliations to the Condensed Consolidated Financial Statements:

Segment assets are summarized as follows as of September 30, 2022, and December 31, 2021, respectively, along with reconciliations to the Condensed Consolidated Financial Statements:

(in thousands)

As of June 30, 2022 Multifamily All Other Total

As of September 30, 2022 Multifamily All Other Total

Segment assets

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Restrictions on Taxable Dispositions.

Thirty-seven properties, consisting of 6,754 apartment homes, are subject to restrictions on taxable dispositions under agreements entered into with certain of the sellers or contributors of the properties and are effective for varying periods.

Thirty-eight properties, consisting of 6,969 apartment homes, are subject to restrictions on taxable dispositions under agreements entered into with certain of the sellers or contributors of the properties and are effective for varying periods.

Centerspace does not believe that the agreements materially affect the conduct of its business or its decisions whether to dispose of restricted properties during the restriction period because it generally holds these and other properties for investment purposes rather than for sale.

1 unchanged sentence

Otherwise, the Company may be required to provide tax indemnification payments to the parties to these agreements.

Unfunded Commitments.

Centerspace has unfunded commitments of $ 1.6 million in two real estate technology venture funds.

Refer to Note 7 - Fair Value Measurements for additional information regarding these investments.

NOTE 11 • SHARE-BASED COMPENSATION

Share-based awards are provided to officers, non-officer employees, and trustees under the 2015 Incentive Plan approved by shareholders on September 15, 2015, as amended and restated on May 18, 2021 (the “2015 Incentive Plan”) which allows for awards in the form of cash, unrestricted and restricted common shares, stock options, stock appreciation rights, and RSUs up to an aggregate of 775,000 shares over the ten-year period in which the plan is in effect.

Under the 2015 Incentive Plan, officers and non-officer employees may earn share awards under a long-term incentive plan, which is a forward-looking program that measures long-term performance over the stated performance period.

Under the 2015 Incentive Plan, officers and non-officer employees may earn share awards under a long-term incentive plan (“LTIP”), which is a forward-looking program that measures long-term performance over the stated performance period.

These awards are payable to the extent deemed earned in shares.

15 unchanged sentences

Compensation expense is recognized ratably based on the grant date fair value, as determined using the Monte Carlo valuation model, regardless of whether the market conditions are achieved and the awards ultimately vest.

Therefore, previously recorded compensation expense is not adjusted in the event that the market conditions are not achieved.

Therefore, previously recorded compensation expense is not adjusted in

the event that the market conditions are not achieved.

The Company based the expected volatility on a weighted average of the historical volatility of the Company’s daily closing share price and a select peer average volatility, the risk-free interest rate on the interest rates on U.S.

2 unchanged sentences

The share price at the grant date, January 1, 2022, was $ 110.90 per share.

Awards granted to employees on February 1, 2022, consist of an aggregate of 1,295 time-based RSU awards which vest as to one-third of the RSUs on each of January 1, 2023, January 1, 2024, and January 1, 2025.

Awards granted to employees on February 1, 2022, consist of an aggregate of 1,295 time-based RSU awards which vest as to one-third of the RSUs on each of February 1, 2023, February 1, 2024, and February 1, 2025.

Awards granted to trustees on May 17, 2022 consist of 6,563 time-based RSUs, which vest on May 17, 2023.

1 unchanged sentence

Share-Based Compensation Expense

Share-based compensation expense recognized in the consolidated financial statements for all outstanding share-based awards was $ 1.2 million and $ 1.5 million for the six months ended June 30, 2022 and 2021, respectively.

Share-based compensation expense recognized in the consolidated financial statements for all outstanding share-based awards was $ 709,000 and $ 600,000 for the three months ended September 30, 2022 and 2021, respectively and $ 1.9 million and $ 2.1 million for the nine months ended September 30, 2022 and 2021, respectively.

NOTE 12 • SUBSEQUENT EVENTS

Through October 31, 2022, Centerspace repurchased 426,773 common shares for total consideration of $ 28.7 million and an average of $ 67.25 per share.

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.

What changed 10-Q

Item 1. Financial Statements