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Takeaway: Easily-overlooked non-gateway MF REIT w/ excellent track record of capital allocation.

LONG IRT; IMPRESSIVE CAPITAL ALLOCATION TRACK RECORD

Our REITs team is hosting a call on their active Long Independence Realty (IRT) on Friday, July 12th at 10:00 AM ET to discuss why this company's capital allocation strategy makes it a winner.

Click here to get access.

CALL INVITE -> Long IRT; Excellent Allocation Record - 08.29.2018 REIT cartoon

In our view IRT is a fascinating, often-overlooked and "underrated" MF platform that is perhaps a "must own" over a TAIL duration. In addition to its Sunbelt exposure (~15% of NOI in Atlanta + another ~14% in Dallas, for example), IRT maintains a presence across several other "non-gateway" markets (Denver at ~5.3% of NOI + additional in-process developments). Following the combination with STAR, the company has been focusing on (1) value-add renovations of existing units, from which it earns very high incremental ROICs, and (2) selected ground-up development as opposed to more bulk acquisitions. Very quietly over the past few years IRT has (1) positioned itself to carry net leverage more consistent with other public MF REITs (~5-6x versus ~8-9x not too long ago) despite recycling capital, and (2) improved its ROIC/ROA to pre-STAR transaction levels, despite the 2023-present MF growth slowdown. Both of these are exceptional and, in our view, evidence a very adept and disciplined approach to capital allocation. We think IRT is a low-to-mid ~$20/share stock + easily supports and is poised to grow its yield (on cost), which we will go through.

We invite you to join us for this call.