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Item 2. Management’s Discussion and Analysis

2026-05-04 compared with 2025-11-03 · 135 added, 230 removed, 242 unchanged (60% of the section changed)

Management’s Discussion and Analysis of Financial Conditions and Results of Operations

The following discussion and analysis should be read in conjunction with the unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (the “Report”), the audited financial statements for the year ended December 31, 2024, which are included in our Annual Report on Form 10-K filed with the SEC on February 18, 2025, and the risk factors in Part I, Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for the year ended December 31, 2024 and in Part II, Item 1A, “Risk Factors,” of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, filed with the SEC on May 1, 2025.

The following discussion and analysis should be read in conjunction with the unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 (the “Report”), the audited financial statements for the year ended December 31, 2025, which are included in our Annual Report on Form 10-K filed with the SEC on February 17, 2026, and the risk factors in Part I, Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for the year ended December 31, 2025.

This discussion and analysis and other sections of this Report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), with respect to the expectations for future periods.

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• inflation and price volatility in the global economy;

• uncertain global macro-economic and political conditions, the impact of conflicts in Ukraine and the Middle East, including sanctions imposed by the U.S.

• uncertain global macro-economic and political conditions, the impact of actual or threatened wars or other international conflicts, such as in Ukraine, the Middle East, and South America, including sanctions imposed by the U.S.

and other countries, on inflation, trade, and general economic conditions;

• deteriorating economic conditions, including rising unemployment rates, energy costs, and inflation, in the markets where we own apartment communities or in which we may invest in the future;

• deteriorating economic conditions and rising unemployment rates, energy costs, and inflation, in the markets where we own apartment communities or in which we may invest in the future;

• rental conditions in our markets, including occupancy levels and rental rates, our potential inability to renew residents or obtain new residents upon expiration of existing leases, our ability to identify and consummate attractive acquisitions and dispositions on favorable terms, our ability to reinvest sales proceeds successfully, our inability to accommodate any significant decline in the market value of real estate serving as collateral for our debt and mortgage obligations;

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• timely access to material and labor required to renovate and maintain apartment communities;

• adverse changes in our markets, including future demand for apartment homes in those markets, barriers of entry into new markets, limitations on our ability to increase rental rates, our ability to identify and consummate attractive acquisitions and dispositions on favorable terms, our ability to reinvest sales proceeds successfully, and inability to accommodate any significant decline in market value of real estate serving as collateral for our debt and mortgage obligations;

• pandemics or epidemics and any effects on our employees, residents and commercial tenants, third party vendors and suppliers, and apartment communities, as well as our cash flow, business, financial condition, and results of operations;

• the process and results of our review of strategic alternatives;

• reliance on a single asset class (multifamily) and certain geographic areas (Midwest and Mountain West regions) of the U.S.;

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• inability to raise additional equity capital, if needed;

• financing risks, including our potential inability to meet existing covenants in existing credit facilities or to obtain new debt or equity financing on favorable terms, or at all;

• financing risks, including our potential inability to meet existing covenants in our existing credit facilities or to obtain new debt or equity financing on favorable terms, or at all;

• level and volatility of interest or capitalization rates or capital market conditions;

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New factors may also arise from time to time that could have an adverse effect on our business and results of operations.

Except as otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements to reflect events, circumstances, or changes in expectations after the date on which this Report is filed.

Readers also should review the risks and uncertainties detailed from time to time in filings with the SEC, including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” contained in our Annual Report on Form 10-K for the year ended December 31, 2024 and “Risk Factors” contained in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025.

We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The foregoing review of factors that could cause our actual results to differ materially from those contemplated in any forward-looking statements included in this Report should not be construed as exhaustive.

Readers also should carefully review our financial statements and the notes thereto as well as the risks and uncertainties detailed from time to time in filings with the SEC, including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” contained in our Annual Report on Form 10-K for the year ended December 31, 2025.

Executive Summary

We are a real estate investment trust, or REIT, that owns, manages, acquires, redevelops, and develops apartment communities.

We primarily focus on investing in markets characterized by stable and growing economies, strong employment, and an attractive quality of life that we believe, in combination, lead to higher demand for apartment homes and retention of our residents.

As of September 30, 2025, we owned interests in 68 apartment communities consisting of 12,941 apartment homes.

Property owned, as presented in our Condensed Consolidated Balance Sheets at historical cost and excluding assets held for sale, was $2.5 billion at September 30, 2025 and December 31, 2024.

We primarily focus on investing in markets characterized by stable and growing economic conditions, strong employment, and an attractive quality of life that we believe, in combination, lead to higher demand for our apartment homes and retention of our residents.

As of March 31, 2026, we owned 61 apartment communities containing 12,263 apartment homes.

Property owned, as presented in our Condensed Consolidated Balance Sheets at historical cost was $2.5 billion at March 31, 2026 and December 31, 2025.

Renting apartment homes is our primary source of revenue, and our business objective is to provide great homes.

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We have paid quarterly distributions continuously since our first distribution in 1971.

Overview of the Three Months Ended September 30, 2025

• Acquired Railway Flats in Loveland, Colorado, consisting of 420 homes for an aggregate purchase price of $132.2 million, which includes the assumption of $76.5 million in mortgage debt.

• Sold five apartment communities in St.

Cloud, Minnesota for an aggregate sale price of $124.0 million.

• For the three months ended September 30, 2025, revenue increased by $6.4 million or 9.8% to $71.4 million, compared to $65.0 million for the three months ended September 30, 2024, primarily due to increased revenue from same-store and non-same-store communities.

• Same-store revenues increased by 2.4% for the three months ended September 30, 2025, compared to the same period of the prior year, driving a 4.5% increase in same-store NOI compared to the same period of the prior year.

• Net income was $3.19 per diluted share for the three months ended September 30, 2025, compared to net loss of $0.40 per diluted share for the same period of the prior year.

• Non-GAAP Core Funds from Operations (“Core FFO”) per diluted share increased to $1.19 for the three months ended September 30, 2025, compared to $1.18 for the three months ended September 30, 2024.

See the description of Core FFO on pages 35 and 36 and the reconciliation of net income (loss) available to common shareholders to FFO and Core FFO on page 37.

This increase was primarily due to increased NOI along with distributions to preferred shareholders that occurred in the prior year that did not occur in the same period of the current year, offset by increased interest expense and general and administrative expense.

Overview of the Three Months Ended March 31, 2026

• For the three months ended March 31, 2026, revenue decreased by $2.0 million or 3.0% to $65.1 million, compared to $67.1 million for the three months ended March 31, 2025, primarily due to the sale of 12 apartment communities in the prior year, offset by increased revenue from non-same-store communities.

• Same-store revenues remained consistent year over year, while property operating expenses increased, driving a 1.1% decrease in same-store NOI compared to the same period of the prior year.

• Net loss was $0.77 per diluted share for the three months ended March 31, 2026, compared to net loss of $0.22 per diluted share for the same period of the prior year.

• Non-GAAP Core Funds from Operations (“Core FFO”) per diluted share decreased to $1.12 for the three months ended March 31, 2026, compared to $1.21 for the three months ended March 31, 2025.

See the description of Core FFO on pages 25 and 26 and the reconciliation of net loss available to common shareholders to FFO and Core FFO on page 27.

This decrease was primarily due to decreased NOI due to dispositions and same-store communities, along with increases in general and administrative expenses and interest expense, offset by increased NOI on non-same-store communities.

The drivers of these changes are discussed in more detail in the “Results of Operations” section below.

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GAAP and Non-GAAP Financial Measures

Net operating income (“NOI”) is a non-GAAP financial measure, which we define as total real estate revenues less property operating expenses, including real estate taxes and is reconciled to operating income below.

We believe that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by sales of real estate and other investments, impairment, depreciation, amortization, financing costs, property management expenses, casualty gains (losses), loss on litigation settlement, and general and administrative expenses.

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.

We believe that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by sales of real estate and other investments, impairment, depreciation, amortization, financing costs, property management expenses, casualty losses net of recoveries, loss on litigation settlement, and general and administrative expenses.

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 (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance.

We have provided certain information on a same-store and non-same-store basis.

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The discussion below focuses on the main factors affecting real estate revenue and real estate expenses from same-store apartment communities because changes from one year to another in real estate revenue and expenses from non-same-store communities are generally due to the addition of those communities to our real estate portfolio, and accordingly provide less useful information for evaluating the ongoing operational performance of our real estate portfolio.

For the comparison of the nine months ended September 30, 2025 and 2024, four apartment communities and one apartment community, respectively, were non-same-store.

Sold communities and communities designated as held for sale are included in “Held for sale and dispositions,” for all periods presented, while “Other properties” includes non-multifamily properties and the non-multifamily components of mixed-use properties.

For the nine months ended September 30, 2025 and 2024, seven apartment communities were designated as held for sale and included in “Held for sale and dispositions.” During the three and nine months ended September 30, 2025, we disposed of five apartment communities, consisting of 832 apartment homes.

During the nine months ended September 30, 2024, we disposed of two apartment communities, consisting of 205 apartment homes.

Reconciliation of Operating Income to Net Operating Income (non-GAAP)

The following table provides a reconciliation of operating income to NOI (non-GAAP), which is defined above.

For the comparison of the three months ended March 31, 2026 and 2025, 58 apartment communities were same-store and three apartment communities and one apartment community were non-same-store, respectively.

Sold communities are included in “Dispositions,” for all periods presented, while “Other properties” includes non-multifamily properties and the non-multifamily components of mixed-use properties.

Reconciliation of Operating Income (Loss) to Net Operating Income (non-GAAP)

The following table provides a reconciliation of operating income (loss) to NOI (non-GAAP), which is defined above.

(in thousands, except percentages)

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

2025 2024 $ Change % Change 2025 2024 $ Change % Change

Operating income

Three Months Ended March 31,

2026 2025 $ Change % Change

Operating income (loss)

$ (5,393) $ 4,746 $ (10,139) (213.6) %

Property management expenses 2,379 2,433 (54) (2.2) %

Casualty loss (gain)

127 (412) 539 (130.8) % 1,058 918 140 15.3 %

Casualty loss, net of recoveries (21) 532 (553) (103.9) %

Depreciation and amortization 26,498 27,654 (1,156) (4.2) %

Impairment of real estate investments 8,676 — 8,676 N/A 23,219 — 23,219 N/A

Impairment of real estate investments 9,700 — 9,700 N/A

General and administrative expenses 6,332 4,997 1,335 26.7 %

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

(79,531) — (79,531) N/A (79,531) 577 (80,108) *

Net operating income $ 39,495 $ 40,362 $ (867) (2.1) %

* Not a meaningful percentage.

The following consolidated results of operations, including GAAP and non-GAAP metrics, cover the three and nine months ended September 30, 2025 and 2024.

The following consolidated results of operations, including GAAP and non-GAAP metrics, cover the three months ended March 31, 2026 and 2025.

(in thousands, except percentages)

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

2025 2024 $ Change % Change 2025 2024 $ Change % Change

Three Months Ended March 31,

2026 2025 $ Change % Change

Same-store (1)

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921 817 104 12.7 %

Held for sale and dispositions (1)

Dispositions (1)

(8) 6,873 (6,881) *

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305 332 (27) (8.1) %

Held for sale and dispositions (1)

Dispositions (1)

(27) 3,231 (3,258) *

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616 485 131 27.0 %

Held for sale and dispositions (1)

Dispositions (1)

19 3,642 (3,623) *

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Property management expenses (2,379) (2,433) (54) (2.2) %

Casualty (loss) gain

(127) 412 539 (130.8) % (1,058) (918) 140 15.3 %

Casualty loss, net of recoveries 21 (532) (553) (103.9) %

Depreciation and amortization (26,498) (27,654) (1,156) (4.2) %

Impairment of real estate investments (8,676) — 8,676 N/A (23,219) — 23,219 N/A

Impairment of real estate investments (9,700) — 9,700 N/A

General and administrative expenses (6,332) (4,997) 1,335 26.7 %

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

79,531 — 79,531 N/A 79,531 (577) 80,108 *

Interest expense (10,470) (9,635) 835 8.7 %

Loss on extinguishment of debt (3) — 3 N/A (3) — 3 N/A

Interest and other income

890 708 182 25.7 %

NET INCOME (LOSS)

$ (14,973) $ (4,181) $ (10,792) 258.1 %

Distributions to Series D preferred unitholders (57) (160) 103 (64.4) %

Net (income) loss attributable to noncontrolling interests – Operating Partnership and Series E preferred units

Net loss attributable to noncontrolling interests – Operating Partnership and Series E preferred units

2,141 643 1,498 233.0 %

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— (36) 36 (100.0) %

Net income (loss) attributable to controlling interests

53,783 (1,048) 54,831 * 35,534 (6,249) 41,783 *

Distributions to preferred shareholders — (1,607) 1,607 (100.0) % — (4,821) 4,821 (100.0) %

Redemption of Preferred Shares — (3,511) 3,511 (100.0) % — (3,511) 3,511 (100.0) %

NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS

NET LOSS AVAILABLE TO COMMON SHAREHOLDERS

$ (12,889) $ (3,734) $ (9,155) 245.2 %

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* Not a meaningful percentage.

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

Three Months Ended March 31,

Weighted Average Occupancy (1)

2025 2024 2025 2024

Same-store 95.4 % 95.8 %

Non-same-store 92.0 % 86.4 %

95.0 % 95.5 % 95.4 % 95.2 %

Total 95.1 % 95.5 %

(1) Weighted average occupancy is defined as the percentage resulting from dividing actual rental revenue by scheduled rental revenue.

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Weighted average occupancy may not completely reflect short-term trends in physical occupancy, and the calculation of weighted average occupancy may not be comparable to that disclosed by other REITs and other real estate companies.

(2) Excludes apartment communities classified as held for sale.

Number of Apartment Homes as of September 30, 2025 as of September 30, 2024

Number of Apartment Homes as of March 31, 2026 as of March 31, 2025

Same-store 11,214 11,213

Non-same-store 1,049 288

Held for sale and dispositions

Total 12,263 13,012

Same-store analysis.

Revenue from same-store communities increased 2.4%, or $1.4 million, in the three months ended September 30, 2025, compared to the same period in the prior year.

The increase was attributable to 2.2% growth in average monthly revenue per occupied home for the three months ended September 30, 2025 and an increase of 0.2% in occupancy as weighted average occupancy increased from 95.6% for the three months ended September 30, 2024 to 95.8% for the three months ended September 30, 2025.

Property operating expenses, including real estate taxes, at same-store communities decreased by 0.8% or $179,000 in the three months ended September 30, 2025, compared to the same period in the prior year.

At same-store communities, controllable expenses (which exclude insurance and real estate taxes) increased by $477,000, primarily due to an increase in repairs and maintenance, compensation, and utilities.

Non-controllable expenses at same-store communities decreased by $656,000, due to real estate taxes and insurance-related costs.

Same-store NOI increased by $1.5 million to $35.5 million for the three months ended September 30, 2025, compared to $34.0 million in the same period of the prior year.

Revenue from same-store communities increased 2.8%, or $4.8 million, in the nine months ended September 30, 2025, compared to the same period in the prior year.

The increase was attributable to 2.2% growth in average monthly revenue per occupied home for the nine months ended September 30, 2025 and an increase of 0.6% in occupancy as weighted average occupancy increased from 95.3% for the nine months ended September 30, 2024 to 95.9% for the nine months ended September 30, 2025.

Property operating expenses, including real estate taxes, at same-store communities increased by 2.6% or $1.7 million in the nine months ended September 30, 2025, compared to the same period in the prior year.

At same-store communities, controllable expenses (which exclude insurance and real estate taxes) increased by $1.2 million, primarily due to an increase in utilities and compensation.

Non-controllable expenses at same-store communities increased by $483,000, due to real estate taxes and offset by a decrease in insurance-related costs.

Same-store NOI increased by $3.1 million to $107.0 million for the nine months ended September 30, 2025, compared to $103.8 million in the same period of the prior year.

Revenue from same-store communities remained consistent in the three months ended March 31, 2026, compared to the same period in the prior year.

The average monthly revenue per occupied home for the three months ended March 31, 2026 remained consistent with comparable periods while weighted average occupancy decreased 0.4% from 95.8% for the three months ended March 31, 2025 to 95.4% for the three months ended March 31, 2026.

Property operating expenses, including real estate taxes, at same-store communities increased by 1.7% or $393,000 in the three months ended March 31, 2026, compared to the same period in the prior year.

At same-store communities, controllable expenses (which exclude insurance and real estate taxes) increased by $490,000, primarily due to an increase in repairs and maintenance, utilities, and administrative and marketing expenses.

Non-controllable expenses at same-store communities decreased by $97,000, due to a decrease in real estate taxes.

Same-store NOI decreased by $388,000 to $35.3 million for the three months ended March 31, 2026, compared to $35.7 million in the same period of the prior year.

Non-same-store analysis.

Revenue from non-same-store communities increased by $4.6 million in the three months ended September 30, 2025, compared to the same period in the prior year.

Property operating expenses, including real estate taxes at non-same-store communities increased by $1.9 million.

NOI at non-same-store communities increased by $2.6 million for the three months ended September 30, 2025, compared to the same period of the prior year.

The increase in revenue, property operating expenses, and NOI from non-same-store communities is due to the addition of three apartment communities, one during the fourth quarter of the prior year, one during the second quarter of the current year, and one in the third quarter of the current year, offset by a $334,000 decrease in NOI from repositioning a community by making full unit upgrades, resulting in lower occupancy and requiring relocation of residents.

Revenue from non-same-store communities increased by $6.8 million in the nine months ended September 30, 2025, compared to the same period in the prior year.

Revenue from non-same-store communities increased by $4.7 million in the three months ended March 31, 2026, compared to the same period in the prior year.

Property operating expenses, including real estate taxes at non-same-store communities increased by $1.7 million.

NOI at non-same-store communities increased by $3.7 million for the nine months ended September 30, 2025, compared to the same period of the prior year.

The increase in revenue, property operating expenses, and NOI from non-same-store communities is due to the addition of three apartment communities, one during the fourth quarter of

the prior year, one during the second quarter of the current year, and one during the third quarter of the current year, offset by a $651,000 decrease in NOI from repositioning a community by making full unit upgrades, resulting in lower occupancy and requiring relocation of residents.

NOI at non-same-store communities increased by $3.0 million for the three months ended March 31, 2026, compared to the same period of the prior year.

The increase in revenue, property operating expenses, and NOI from non-same-store communities is due to the addition of two apartment communities, one during the second quarter of the prior year and one during the third quarter of the prior year, offset by a $149,000 decrease in NOI from a community that experienced an increase in expenses resulting from the cancellation of contracts and uninsured loss events.

Other properties analysis.

Revenue from other properties, which encompasses our commercial and mixed-use activity, increased by $361,000 in the three months ended September 30, 2025, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, at other properties increased by $66,000, compared to the same period in the prior year.

NOI at other properties increased by $295,000, compared to the same period in the prior year.

The increase in revenue, property operating expense, and NOI on other properties is due to the addition of an apartment community with commercial space during the fourth quarter of the prior year.

Revenue from other properties, which encompasses our commercial and mixed-use activity, increased by $817,000 in the nine months ended September 30, 2025, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, at other properties increased by $235,000, compared to the same period in the prior year.

Revenue from other properties, which encompasses our commercial and mixed-use activity, increased by $104,000 in the three months ended March 31, 2026, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, at other properties decreased by $27,000, compared to the same period in the prior year.

NOI at other properties increased by $131,000, compared to the same period in the prior year.

The increase in revenue, property operating expense, and NOI on other properties is due to the addition of an apartment community with commercial space during the fourth quarter of the prior year.

Held for sale and dispositions analysis.

Revenue from held for sale and dispositions increased by $88,000 in the three months ended September 30, 2025, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, decreased by $93,000 on held for sale and dispositions, compared to the same period in the prior year.

NOI on held for sale and dispositions increased $181,000, compared to the same period in the prior year.

We disposed of two apartment communities in the first quarter of 2024, disposed of five apartment communities during the third quarter of 2025, and had seven apartment communities classified as held for sale as of September 30, 2025.

Revenue from held for sale and dispositions increased by $89,000 in the nine months ended September 30, 2025, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, on held for sale and dispositions decreased by $233,000, compared to the same period in the prior year.

NOI on held for sale and dispositions increased $322,000, compared to the same period in the prior year.

The increase in revenue and NOI on other properties is primarily due to increased occupancy in the current period.

Dispositions analysis.

Revenue from dispositions decreased by $6.9 million in the three months ended March 31, 2026, compared to the same period in the prior year.

Property operating expenses, including real estate taxes, decreased by $3.3 million on dispositions, compared to the same period in the prior year.

NOI on dispositions decreased $3.6 million, compared to the same period in the prior year.

We disposed of five apartment communities during the third quarter of 2025 and seven apartment communities in the fourth quarter 2025.

Property management expenses .

Property management expenses, consisting of property management overhead and property management fees paid to third parties, increased by 11.0% to $2.5 million in the three months ended September 30, 2025, compared to $2.2 million in the same period of the prior year.

The increase was primarily due to higher compensation related costs compared to the same period of the prior year and fees paid to third parties for management of an apartment community we acquired in the second quarter of 2025.

Property management expense, consisting of property management overhead and property management fees paid to third parties, increased by 7.7% to $7.3 million in the nine months ended September 30, 2025, compared to $6.8 million in the same period of the prior year.

The increase was primarily due to higher compensation costs resulting from new positions and increased pay rates compared to the same period of the prior year, along with fees paid to third parties for management of an apartment community we acquired in the second quarter of 2025.

Casualty gain (loss).

Casualty loss was $127,000 in the three months ended September 30, 2025, compared to a gain of $412,000 in the same period of the prior year.

The increase is primarily due to claim activity in the prior year with losses in excess of our deductibles resulting in estimated recoveries compared to fewer large loss claims in excess of our deductibles and fewer recoveries in the current period.

See Note 2 of the Notes to the Condensed Consolidated Financial Statements in the report for more details.

Casualty loss was $1.1 million in the nine months ended September 30, 2025, compared to $918,000 in the same period of the prior year.

Property management expenses, consisting of property management overhead and property management fees paid to third parties, decreased by 2.2% to $2.4 million in the three months ended March 31, 2026.

The decrease was primarily due to reduced compensation related costs resulting from a reduction in headcount compared to the same period of the prior year, offset by an increase in fees paid to third parties for management of an apartment community we acquired in the second quarter of 2025.

Casualty loss, net of recoveries.

Casualty activity was a net recovery of $21,000 in the three months ended March 31, 2026, compared to a net loss of $532,000 in the same period of the prior year.

The change is primarily due to claim activity in excess of our deductible along with increases in insurance recoveries and subrogation proceeds compared to the prior year.

See Note 2 of the Notes to the Condensed Consolidated Financial Statements in the report for more details.

Depreciation and amortization.

Depreciation and amortization increased by 11.4% to $29.1 million in the three months ended September 30, 2025, compared to $26.1 million in the same period of the prior year, primarily attributable to an increase in depreciation on apartment communities driven by the addition of three apartment communities, one in the fourth quarter of the prior year, one during the second quarter of the current year, and one in the third quarter of the current year, along with value add and acquisition capital projects and amortization of in-place leases, offset by a decrease in depreciation from held for sale and sold communities.

Depreciation and amortization increased by 6.3% to $83.8 million in the nine months ended September 30, 2025, compared to $78.8 million in the same period of the prior year, primarily attributable to an increase in depreciation on apartment communities driven by the addition of three apartment communities, one in the fourth quarter of the prior year, one during the second quarter of the current year, and one in the third quarter of the current year, along with value add and acquisition capital projects, offset by a decrease in depreciation from held for sale and sold communities.

Impairment of real estate investments .

Impairment of real estate investments was $8.7 million and $23.2 million in the three and nine months ended September 30, 2025, respectively.

The impairment was the result of six apartment communities that were written down to estimated fair value in connection with updated market offers on these held for sale assets.

Depreciation and amortization decreased by 4.2% to $26.5 million in the three months ended March 31, 2026, compared to $27.7 million in the same period of the prior year, primarily attributable to a decrease of $3.0 million in depreciation from dispositions that occurred in the prior year and a decrease of $861,000 on same-store communities primarily due to amortization of in-place leases in the prior year that did not occur in the current year, offset by an increase of $3.1 million on non-same-store driven by the addition of two apartment communities, one during the second quarter of the prior year and one in the third quarter of the prior year, along with value add and acquisition capital projects and amortization of in-place leases.

General and administrative expenses.

General and administrative expenses increased by $895,000 to $5.0 million in the three months ended September 30, 2025, compared to $4.1 million in the same period of the prior year.

The increase was primarily due to increased compensation costs from higher share-based compensation and other compensation related costs and increased professional fees in the three months ended September 30, 2025, compared to the same period of the prior year.

General and administrative expenses increased by $1.4 million to $14.4 million in the nine months ended September 30, 2025, compared to $12.9 million in the same period of the prior year.

The increase was primarily due to increased compensation costs from higher share-based compensation and other compensation related costs along with professional fees and administrative and office expenses in the nine months ended September 30, 2025, compared to the same period of the prior year.

Gain on sale of real estate and other investments.

Gain on sale of real estate and other investments was $79.5 million for the three months ended September 30, 2025, compared to no gain or loss in the same period of the prior year.

Refer to Note 8 in the Condensed Consolidated Financial Statements for more information.

Gain on sale of real estate and other investments was $79.5 million for the nine months ended September 30, 2025, compared to a loss of $577,000 in the same period of the prior year.

Refer to Note 8 in the Condensed Consolidated Financial Statements for more information.

General and administrative expenses increased by $1.3 million to $6.3 million in the three months ended March 31, 2026, compared to $5.0 million in the same period of the prior year.

The increase was primarily due to $977,000 in fees related to strategic review and increased compensation costs from higher share-based compensation and other compensation related costs in the three months ended March 31, 2026, compared to the same period of the prior year.

Interest expense.

Interest expense increased by 45.2% to $13.0 million in the three months ended September 30, 2025, compared to $8.9 million in the same period of the prior year, primarily due to a higher outstanding balance on our lines of credit resulting from the acquisitions of two apartment communities, one in the second quarter and one in the third quarter of the current year, along with higher mortgage interest and amortization of debt discount resulting from the assumption of mortgages in connection with an acquisition in the fourth quarter of the prior year and an acquisition in the third quarter of the current year.

Interest expense increased by 21.3% to $33.3 million in the nine months ended September 30, 2025, compared to $27.5 million in the same period of the prior year, primarily due to a higher outstanding balance on our lines of credit resulting from the acquisitions of two apartment communities, one in the second quarter and one in the third quarter of the current year, along with higher mortgage interest and amortization of debt discount resulting from the assumption of mortgages in connection with an acquisition in the fourth quarter of the prior year and an acquisition in the third quarter of the current year.

Interest expense increased by 8.7% to $10.5 million in the three months ended March 31, 2026, compared to $9.6 million in the same period of the prior year, primarily due to a higher outstanding balance on our lines of credit resulting from the acquisitions of two apartment communities, one in the second quarter and one in the third quarter of the prior year, along with higher mortgage interest and amortization of debt discount resulting from the assumption of mortgages in connection with an acquisition in the third quarter of the prior year.

Interest and other income.

Interest and other income increased to $1.2 million in the three months ended September 30, 2025, compared to $645,000 in the same period of the prior year.

The increase was primarily due to a real estate related note receivable which has a higher principal balance in the current period compared to the same period of the prior year and a note receivable acquired in the fourth quarter of 2024.

Interest and other income increased to $2.6 million in the nine months ended September 30, 2025, compared to $1.5 million in the same period of the prior year.

The increase was primarily due to a real estate related note receivable which has a higher principal balance in the current period compared to the same period of the prior year, a note receivable acquired in the fourth quarter of 2024, and a larger gain on investments in the current period compared to the same period of the prior year.

Net income (loss) available to common shareholders.

Net income available to common shareholders was $53.8 million for the three months ended September 30, 2025, compared to a net loss of $6.2 million in the three months ended September 30, 2024.

Net income available to common shareholders was $35.5 million for the nine months ended September 30, 2025, compared to a net loss of $14.6 million in the nine months ended September 30, 2024.

Interest and other income increased to $890,000 in the three months ended March 31, 2026, compared to $708,000 in the same period of the prior year.

The increase was primarily due to an unrealized gain on investments and interest income from a real estate related note receivable which has a higher principal balance in the current period compared to the same period of the prior year.

Net loss available to common shareholders.

Net loss available to common shareholders was $12.9 million for the three months ended March 31, 2026, compared to a net loss of $3.7 million in the three months ended March 31, 2025.

Funds from Operations and Core Funds from Operations .

because its calculation does not assume the value of real estate assets diminishes predictably over time, as implied by the historical cost convention of GAAP and the recording of depreciation and amortization.

We believe that Funds from Operations (“FFO”), which is a non-GAAP financial measure used as a standard supplemental measure for equity real estate investment trusts, is helpful to investors in understanding operating performance, primarily because its calculation does not assume the value of real estate assets diminishes predictably over time, as implied by the historical cost convention of GAAP and the recording of depreciation and amortization.

We use the definition of FFO adopted by the National Association of Real Estate Investment Trusts, Inc.

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Accordingly, FFO presented here is not necessarily comparable to FFO presented by other real estate companies.

FFO should not be considered as an alternative to net income (loss) or any other GAAP measurement of performance, but rather should be considered as an additional, supplemental measure.

FFO should not be considered as an alternative to net income (loss) or any other GAAP measurement of

performance, but rather should be considered as an additional, supplemental measure.

FFO also does not represent cash generated from operating activities in accordance with GAAP, nor is it indicative of funds available to fund all cash needs, including our ability to service indebtedness or make distributions to shareholders.

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Core FFO is a non-GAAP and non-standardized financial measure that may be calculated differently by other REITs and that should not be considered a substitute for operating results determined in accordance with GAAP.

Net income available to common shareholders for the three months ended September 30, 2025, was $53.8 million compared to net loss of $6.2 million for the same period of the prior year.

FFO applicable to common shares and Units for the three months ended September 30, 2025, increased to $23.3 million compared to $18.7 million for the comparable period of the prior year, representing an increase of 24.7%.

This FFO increase was primarily due to increased NOI along with distributions to preferred shareholders that occurred in the prior year that did not occur in the same period of the current year, offset by increased interest expense and general and administrative expense.

Net income available to common shareholders for the nine months ended September 30, 2025, was $35.5 million compared to net loss of $14.6 million for the same period of the prior year.

FFO applicable to common shares and Units for the nine months ended September 30, 2025, increased to $71.1 million compared to $61.7 million for the comparable period of the prior year, representing an increase of 15.1%.

Reconciliation of Net Income (Loss) Available to Common Shareholders to Funds from Operations and Core Funds from Operations

Net loss available to common shareholders for the three months ended March 31, 2026, was $12.9 million compared to net loss of $3.7 million for the same period of the prior year.

FFO applicable to common shares and Units for the three months ended March 31, 2026, decreased to $21.1 million compared to $23.2 million for the comparable period of the prior year, representing a decrease of 8.9%.

This FFO decrease was primarily due to decreased NOI from dispositions and same-store communities along with increases in general and administrative expenses and interest expense, offset by increased NOI from non-same-store communities.

Reconciliation of Net Loss Available to Common Shareholders to Funds from Operations and Core Funds from Operations

(in thousands, except per share and unit amounts)

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

2025 2024 2025 2024

Three Months Ended March 31,

Funds from Operations:

Net income (loss) available to common shareholders

Net loss available to common shareholders

$ (12,889) $ (3,734)

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Impairment of real estate investments 9,700 —

(Gain) loss on sale of real estate

(79,531) — (79,531) 577

Less gain on sale of real estate - partially owned entities 2,251 — 2,251 —

FFO applicable to common shares and Units $ 21,101 $ 23,172

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Non-cash casualty (recovery) loss

(123) (632) 308 261

Loss on extinguishment of debt 3 — 3 —

Interest rate swap amortization — 175

Amortization of assumed debt 365 417

Redemption of preferred shares — 3,511 — 3,511

Legal and other costs related to strategic review 977 —

Other miscellaneous items (1)

(455) (61) (503) (35)

Core FFO applicable to common shares and Units $ 22,041 $ 23,979

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Per Share Data

Net income (loss) per common share - diluted (2)

Net loss per common share - basic and diluted (2)

$ (0.77) $ (0.22)

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Core FFO per share and Unit - diluted $ 1.12 $ 1.21

Weighted average shares - basic for net income (loss)

16,726 15,528 16,731 15,143

Effect of operating partnership Units for net income, FFO and Core FFO

966 818 972 836

Effect of Series D preferred units for net income, FFO and Core FFO

155 228 204 228

Effect of Series E preferred units for net income, FFO and Core FFO

Weighted average shares - basic and diluted for net income (loss)

16,775 16,727

Effect of dilutive restricted stock units and stock options for net income, FFO and Core FFO

Weighted average shares and Units for net income, FFO and Core FFO - diluted 19,771 18,676 19,835 18,303

(1) Consists of (gain) loss on investments and one-time professional fees.

Effect of operating partnership Units for FFO and Core FFO

Effect of Series D preferred units for FFO and Core FFO

Effect of Series E preferred units for FFO and Core FFO

Effect of dilutive restricted stock units and stock options for FFO and Core FFO

Weighted average shares and Units for FFO and Core FFO - diluted 19,692 19,876

(1) Consists of (gain) loss on investments.

(2) Refer to Note 3 of the Notes to the Condensed Consolidated Financial Statements for additional details on net income (loss) per share.

Acquisitions and Dispositions

We acquired $281.2 million of new real estate during the nine months ended September 30, 2025.

We disposed of five apartment communities in one transaction for an aggregate sales price of $124.0 million during the nine months ended September 30, 2025.

Refer to Note 8 in the Condensed Consolidated Financial Statements for more information.

We did not acquire or dispose of real estate during the three months ended March 31, 2026 and 2025.

Distributions Declared

Distributions of $0.77 and $0.75 per common share and Unit were declared during the three months ended September 30, 2025 and 2024, respectively.

Distributions of $2.31 and $2.25 per common share and Unit were declared during the nine months ended September 30, 2025 and 2024, respectively.

Distributions of $0.4140625 and $1.242188 per Series C preferred share were declared during the three and nine months ended September 30, 2024, respectively.

Distributions of $0.9655 per Series D preferred unit were declared during the three months ended September 30, 2025 and 2024 and $2.8965 per Series D preferred unit for the nine months ended September 30, 2025 and 2024.

Distributions of $0.96875 per Series E preferred unit were declared during the three months ended September 30, 2025 and 2024 and $2.90625 per Series E preferred unit for the nine months ended September 30, 2025 and 2024.

Distributions of $0.77 per common share and Unit were declared during the three months ended March 31, 2026 and 2025.

Distributions of $0.9655 per Series D preferred unit were declared during the three months ended March 31, 2026 and 2025.

Distributions of $0.96875 per Series E preferred unit were declared during the three months ended March 31, 2026 and 2025.

Liquidity and Capital Resources

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Our primary liquidity demands are normally-recurring operating and overhead expenses, debt service and repayments, capital improvements to our communities, distributions to the holders of our common shares, Series D and Series E preferred units, and Units, value-add redevelopment, common and preferred share buybacks and Unit redemptions, funding of mezzanine loans or real estate related notes, and acquisitions of additional communities.

Although we believe that our financial condition and liquidity are sufficient to meet our reasonably anticipated liquidity demands, factors that could increase or decrease our future liquidity include, but are not limited to, changes in interest rates or sources of financing, general volatility in capital and credit markets, changes in minimum REIT dividend requirements, and our ability to access the capital markets on favorable terms, or at all.

Although we believe that our financial condition and liquidity are sufficient to meet our reasonably anticipated liquidity demands, factors that could increase or decrease our future liquidity include, but are not limited to, changes in interest rates or sources of financing, general volatility in capital and credit markets, changes in minimum REIT distribution requirements, and our ability to access the capital markets on favorable terms, or at all.

As a result of the foregoing conditions or general economic conditions in our markets that affect our ability to attract and retain residents, we may not generate sufficient cash flow from operations.

If we are unable to obtain capital from other sources, we may not be able to pay the distribution required to maintain our status as a REIT, make required principal and interest payments, make strategic acquisitions or make necessary routine capital improvements or undertake value add renovation opportunities with respect to our existing portfolio of operating assets.

As of September 30, 2025, we had total liquidity of approximately $200.4 million, which included $187.5 million available on the lines of credit based on the value of unencumbered properties and $12.9 million of cash and cash equivalents.

As of March 31, 2026, we had total liquidity of approximately $267.1 million, which included $259.6 million available on the lines of credit based on the value of unencumbered properties and $7.6 million of cash and cash equivalents.

As of December 31, 2025, we had total liquidity of approximately $267.9 million, which included $255.1 million available on the lines of credit based on the value of unencumbered properties and $12.8 million of cash and cash equivalents.

As of September 30, 2025, we had a multibank, revolving line of credit with total commitments and borrowing capacity of $400.0 million, based on the value of unencumbered properties, (the “Unsecured Credit Facility” or “Facility”).

In May 2025, the Company exercised the accordion feature of the Facility, expanding the borrowing capacity by $150.0 million to $400.0 million.

As of March 31, 2026, we had a multibank, revolving line of credit with total commitments and borrowing capacity of $400.0 million, based on the value of unencumbered properties, (the “Unsecured Credit Facility” or “Facility”).

In May 2025, we exercised the accordion feature of the Facility, expanding the borrowing capacity by $150.0 million to $400.0 million.

Prior to the exercise of the accordion feature, the line of credit had total commitments and borrowing capacity of up to $250.0 million, based on the value of unencumbered properties.

As of September 30, 2025, there was $222.5 million outstanding on this line of credit and additional borrowing availability was $177.5 million.

At December 31, 2024, the line of credit borrowing capacity was $250.0 million based on the value of unencumbered properties, of which $44.0 million was outstanding and additional borrowing availability was $206.0 million.

As of March 31, 2026, there was $150.0 million outstanding on this line of credit, bearing interest at a rate of 4.88%, and additional borrowing availability was $250.0 million.

As of December 31, 2025, there was $154.0 million outstanding, bearing interest at a rate of 5.12%, and additional borrowing availability was $246.0 million.

The line of credit is utilized to refinance existing indebtedness, to finance property acquisitions, to finance capital expenditures, and for general corporate purposes.

On July 26, 2024, the Unsecured Credit Facility was amended to extend maturity and to modify the leverage-based margin ratios applicable to borrowings.

As amended, this Facility matures in July 2028, with an option to extend maturity for up to two additional six-month periods.

As amended, the interest rates on the line of credit are based on the consolidated leverage ratio, at our option, on either the lender’s base rate plus a margin, ranging from 20-80 basis points, or the daily or term Secured Overnight Financing Rate (“SOFR”), plus a margin that ranges from 120-180 basis points, with the consolidated leverage ratio described under the Third Amended and Restated Credit Agreement, as amended.

This Facility matures in July 2028, with an option to extend maturity for up to two additional six-month periods.

The Secured Overnight Financing Rate (“SOFR”) is the benchmark alternative reference rate under the Facility.

As amended, the interest rates on the line of credit are based on the consolidated leverage ratio, at our option, on either the lender’s base rate plus a margin, ranging from 20-80 basis points, or the daily or term SOFR, plus a margin that ranges from 120-180 basis points, with the consolidated leverage ratio described under the Third Amended and Restated Credit Agreement, as amended.

We have an operating line of credit agreement with US Bank, N.A.

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This operating line of credit terminates in September 2026 and is designed to enhance treasury management activities and more effectively manage cash balances.

As of September 30, 2025 there was no outstanding balance on this line of credit compared to $3.4 million outstanding as of December 31, 2024.

As of March 31, 2026 there was $429,000 outstanding balance on this line of credit, bearing interest at a rate of 5.88%, compared to $925,000 outstanding as of December 31, 2025, bearing interest at a rate of 5.91%.

We have a private shelf agreement with PGIM, Inc., an affiliate of Prudential Financial, Inc., and certain affiliates of PGIM, Inc.

(collectively, “PGIM”) under which we have issued $175.0 million in unsecured senior promissory notes (“Unsecured Shelf Notes”).

(collectively, “PGIM”) under which we have issued $175.0 million in unsecured senior promissory notes (“Unsecured

Shelf Notes”).

On October 28, 2024, the shelf agreement was amended to extend the period of time during which we may borrow money to October 2027 and to increase the borrowing capacity to $300.0 million.

We also issued $125.0 million of senior unsecured promissory notes (the “Unsecured Club Notes”, and collectively with the Unsecured Shelf Notes, the “unsecured senior notes”), under a separate private note purchase agreement with PGIM and certain other lenders.

The following table shows the notes issued under both agreements as of September 30, 2025 and December 31, 2024.

The following table shows the notes issued under both agreements as of March 31, 2026 and December 31, 2025.

(in thousands)

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

As of September 30, 2025 and December 31, 2024, the FMCF had a balance of $198.9 million.

As of March 31, 2026 and December 31, 2025, the FMCF had a balance of $198.9 million.

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

Mortgage loan indebtedness, excluding unamortized premiums and discounts and the FMCF, was $455.9 million on 13 apartment communities at September 30, 2025 and $420.4 million on 15 apartment communities at December 31, 2024.

Mortgage loan indebtedness, excluding unamortized premiums and discounts and the FMCF, was $398.6 million on 10 apartment communities at March 31, 2026 and $400.1 million on 10 apartment communities at December 31, 2025.

All of our mortgage debt is collateralized by apartment communities and is non-recourse at fixed rates of interest, with staggered maturities.

This reduces the exposure to changes in interest rates, which minimizes the effect of interest rate fluctuations on our results of operations and cash flows.

As of September 30, 2025 and December 31, 2024, the weighted average interest rate on mortgage debt was 3.87% and 4.02%, respectively.

Further information can be found in Note 5 - Debt in the Condensed Consolidated notes.

We had an equity distribution agreement in connection with our at the market offering (“ATM Program”) through which we may offer and sell common shares in amounts and at times determined by management.

The maximum aggregate offering price of common shares available for offer and sale thereunder was $500.0 million.

As of March 31, 2026 and December 31, 2025, the weighted average interest rate on mortgage debt was 3.88%.

Further information, including principal payments due on our mortgage indebtedness and other tabular information, can be found in Note 5 - Debt in the Condensed Consolidated notes.

Our borrowings are subject to customary covenants and limitations.

We believe that we were in compliance with all such covenants and limitations as of March 31, 2026.

We have an at the market offering (“ATM Program”) through which we may offer and sell common shares in amounts and at times determined by management.

The maximum aggregate offering price of common shares available for offer and sale thereunder is $500.0 million.

Under the ATM Program, we may enter into separate forward sale agreements.

The proceeds from the sale of common shares under the 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.

There were no sales of common shares under the ATM program during the three and nine months ended September 30, 2025.

The table below provides details on the sale of common shares during the three and nine months ended September 30, 2024 under the ATM Program.

As of September 30, 2025, common shares having an aggregate offering price of up to $262.9 million remained available under the ATM Program.

There were no sales of common shares under the ATM program during the three months ended March 31, 2026 and 2025.

As of March 31, 2026, common shares having an aggregate offering price of up to $262.9 million remained available under the ATM Program.

Further information can be found in Note 4 - Mezzanine Equity and Equity in the Condensed Consolidated notes.

(in thousands, except per share amounts)

Three Months Ended September 30, Number of Common Shares

Net Consideration (1)(2)

Average Net Price Per Share

2024 1,477 $ 105,052 $ 71.12

Nine Months Ended September 30,

2024 1,587 $ 112,613 $ 71.66

(1) Includes 869,000 shares sold on a forward basis for $62.7 million which were physically settled during the three months ended September 30, 2024.

(2) Total consideration is net of $1.0 million and $1.1 million in commissions during the three and nine months ended September 30, 2024, respectively.

We had a share repurchase program, providing for the repurchase of up to an aggregate of $50.0 million of our outstanding common shares which expired on March 10, 2025.

Effective July 31, 2025, the Board of Trustees authorized a new share purchase program (the “Share Repurchase Program”), providing for the repurchase of up to an aggregate of $100.0 million of our outstanding common shares.

This Share Repurchase Program is valid for one year.

Effective July 31, 2025, the Board of Trustees authorized a new share repurchase program (the “Share Repurchase Program”), providing for the repurchase of up to an aggregate of $100.0 million of our outstanding common shares.

Under the Share Repurchase Program, we are authorized to repurchase common shares through open market purchases, privately-negotiated transactions, block trades or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 trading plans and under Rule 10b-18 of the Securities and Exchange Act of 1934, as amended.

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

The table below provides details on the common shares repurchased under these programs during the three and nine months ended September 30, 2025 and 2024.

As of September 30, 2025, the Company had $96.5 million remaining authorized for purchase under the Share Repurchase Program.

(in thousands, except per share amounts)

Three Months Ended September 30, Number of Common Shares Aggregate Cost (1)

Average Price Per Share (1)

2025 63 $ 3,454 $ 54.86

Nine Months Ended September 30,

2025 63 $ 3,454 $ 54.86

2024 88 $ 4,703 $ 53.62

(1) Amount includes commissions.

We had 1.6 million Series E preferred units (noncontrolling interests) outstanding on September 30, 2025 and December 31, 2024.

As of March 31, 2026, the Company had $96.5 million remaining authorized for purchase under the Share Repurchase Program.

We had 1.6 million Series E preferred units (noncontrolling interests) outstanding on March 31, 2026 and December 31, 2025.

Each Series E preferred unit has a par value of $100.

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Each Series E preferred unit is convertible, at the holder’s option, into 1.20482 Units.

The Series E preferred units had an aggregate liquidation preference of $157.2 million and $158.2 million as of September 30, 2025 and December 31, 2024, respectively.

The Series E preferred units had an aggregate liquidation preference of $156.3 million and $157.0 million as of March 31, 2026 and December 31, 2025, respectively.

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

We had 59,400 and 165,600 Series D preferred units outstanding on September 30, 2025 and December 31, 2024, respectively.

We had 59,400 Series D preferred units outstanding on March 31, 2026 and December 31, 2025.

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

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

During the three and nine months ended September 30, 2025, we redeemed 53,700 and 106,200 Series D preferred units, respectively, for an aggregate redemption price of $5.4 million and $10.6 million, respectively.

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

The Series D preferred units had an aggregate liquidation value of $5.9 million and $16.6 million at September 30, 2025 and December 31, 2024, respectively.

The Series D preferred units had an aggregate liquidation value of $5.9 million at March 31, 2026 and December 31, 2025.

Changes in Cash, Cash Equivalents, and Restricted Cash

As of September 30, 2025, we had cash and cash equivalents of $12.9 million and restricted cash consisting of $52.9 million of net tax deferred proceeds, real estate deposits, security deposits, and escrows held by lenders for real estate taxes, insurance, and capital additions.

As of December 31, 2024, we had cash and cash equivalents of $12.0 million and restricted cash consisting of $1.1 million of escrows held by lenders for real estate taxes, insurance, and capital additions.

As of March 31, 2026, we had cash and cash equivalents of $7.6 million and restricted cash consisting of $2.7 million of security deposits and escrows held by lenders for real estate taxes, insurance, and capital additions.

As of December 31, 2025, we had cash and cash equivalents of $12.8 million and restricted cash consisting of $2.8 million of security deposits and escrows held by lenders for real estate taxes, insurance, and capital additions.

The following discussion relates to changes in consolidated cash, cash equivalents, and restricted cash which are presented in the Condensed Consolidated Statements of Cash Flows in Part I, Item 1 above.

In addition to cash flows from operations of $85.7 million, during the nine months ended September 30, 2025, we generated capital from various activities, including:

• Receiving $175.1 million in net draws on the lines of credit;

• Receiving $122.4 million in net proceeds from the sale of five communities.

During the nine months ended September 30, 2025, we used capital for various activities, including:

• Acquiring two apartment communities for $206.2 million in cash, including transaction costs;

We generated cash flows from operations of $21.4 million, during the three months ended March 31, 2026.

During the three months ended March 31, 2026, we used capital for various activities, including:

• Funding capital improvements for apartment communities of approximately $5.3 million;

• Repaying $4.5 million of principal, net of draws, on our lines of credit;

• Repaying $1.6 million of mortgage principal;

• Redeeming 106,200 Series D preferred units for $10.6 million;

• Repurchasing approximately 63,000 common shares for $3.5 million;

• Paying distributions on common shares, Series E preferred units, and Units of $15.1 million.

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High inflation could have a negative impact on our residents and their ability to absorb rent increases.

We also continue to monitor pressures surrounding supply chain challenges.

We also continue to monitor pressures surrounding supply chain challenges, including the impact of tariffs.

Supply chain and inflationary pressures are likely to result in increased operating expenses, specifically, increases in energy costs, labor related costs, and construction materials for repairs and maintenance or capital projects.

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Off-Balance Sheet Arrangements

As of September 30, 2025, we had no significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.

As of March 31, 2026, we had no significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.

Critical Accounting Policies

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Actual results could differ from those estimates.

A summary of critical accounting policies is included in our Form 10-K for the year ended December 31, 2024, filed with the SEC on February 18, 2025, under the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Refer to Note 2 of the Notes to Condensed Consolidated Financial Statements in this report for additional information.

There have been no other significant changes to the critical accounting policies during the nine months ended September 30, 2025.

A summary of critical accounting policies is included in our Form 10-K for the year ended December 31, 2025, filed with the SEC on February 17, 2026, under the section titled “Management’s Discussion and Analysis of Financial

Condition and Results of Operations.” Refer to Note 2 of the Notes to Condensed Consolidated Financial Statements in this report for additional information.

There have been no other significant changes to the critical accounting policies during the three months ended March 31, 2026.

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 2. Management’s Discussion and Analysis