United Dominion Realty Trust (NYSE:UDR) executives said fourth-quarter and full-year 2025 results met or exceeded key expectations and outlined a 2026 outlook shaped by improving lease-rate momentum, moderating new supply, and continued emphasis on data-driven operations and innovation.
2025 results and operating momentum into 2026
Management reported fourth-quarter 2025 FFOA as adjusted per share of $0.64 and full-year 2025 FFOA as adjusted per share of $2.54, both achieving the midpoints of the company’s previously provided guidance ranges. Chief Financial Officer Dave Bragg said same-store expense and NOI growth beat expectations for the year, while same-store revenue growth met guidance. CEO Tom Toomey added that fourth-quarter same-store NOI exceeded the expectations set on the prior quarter’s call.
Transactions, capital allocation, and balance sheet positioning
In the fourth quarter, UDR completed the acquisition of Enclave at Potomac Club, a 406-apartment community in Northern Virginia, for $147 million. Bragg said the property was identified through UDR’s predictive analytics platform and operational considerations, including efficiencies from owning a community directly across the street. He said early results indicate outperformance versus the market, consistent with expectations.
UDR also expanded a joint venture with LaSalle by contributing four apartment communities, increasing the venture to roughly $850 million. With more than $200 million in proceeds from the expansion, the company repaid $128 million of consolidated secured property debt at maturity and repurchased approximately $93 million of common stock at a weighted average share price of $35.56.
Toomey noted that UDR repurchased nearly $120 million of stock during 2025 and said the company would continue using its “Capital Allocation Heat Map” to evaluate sources and uses of capital. Bragg said the current framework favors uses such as investing in the operating platform, share repurchases, and NOI-enhancing capital expenditures, while JV capital and dispositions screen as relatively attractive sources of capital. He added that debt is “significantly more attractive than equity” in the current environment.
On liquidity, Bragg said approximately 12% of total consolidated debt matures through 2027, and the company ended 2025 with nearly $1 billion of liquidity, alongside minimal committed capital and strong free cash flow.
2026 guidance: modest NOI growth and stable FFOA
UDR guided to full-year 2026 FFOA per share of $2.47 to $2.57. At the midpoint of $2.52, Bragg said guidance implies a two-cent, or less than 1%, year-over-year decline versus 2025’s $2.54. He noted that 2025 included two cents from items not expected to repeat in 2026: executive severance and the collection of previously unaccrued interest on a prior debt and preferred equity investment.
Bragg outlined several drivers versus 2025, including:
- + $0.01 from accretive share repurchases executed in 2025
- + $0.01 from lower G&A, expected to decline about 5% year over year
- – $0.01 related to dispositions, as UDR expects to be a net seller in 2026
- – $0.01 from debt and preferred equity activity due to a lower average balance as investments mature and are repaid
For same-store operations, management’s guidance implies about 0.125% year-over-year NOI growth at the midpoint, based on same-store revenue and expense expectations discussed on the call.
Leasing outlook: blended growth expected to improve, with concessions easing
Chief Operating Officer Mike Lacy said the largest building block of 2026 same-store revenue growth is blended lease-rate growth, forecast at 1.5% to 2% on average for the year—about 100 basis points higher than 2025. He attributed the outlook to a 35% year-over-year reduction in supply completions and noted the company is also factoring in a less certain employment environment.
Lacy said UDR expects first-half blended lease-rate growth to be similar to the second half, with potential upside if residual supply pressures ease and concessions “burn off” toward year-end. During Q&A, management said January blended lease-rate growth reached +1%, which was roughly 50 to 75 basis points better than originally anticipated, and reiterated expectations for 1.5% to 2% blended growth in both halves of the year.
Lacy described a sharp improvement in leasing from October through January. He said lease-rate growth bottomed in October, when new lease rates were -8% and renewals were +2%, resulting in blended lease-rate growth of -3%. Since those lows, he said new lease-rate growth improved by 550 basis points, renewals increased 300 basis points, and blended lease-rate growth improved 400 basis points to positive territory. He also said concessions have eased, with portfolio-wide concessions moving from about two weeks on average in October to closer to one week more recently.
On occupancy, Lacy said UDR built occupancy to nearly 97% in October and November and has maintained occupancy in the mid- to high-96% range while pushing rate. He also discussed UDR’s focus on efficiency in the turn process and reducing vacant days, along with efforts to balance renewal pricing and turnover reduction.
Expenses, other income initiatives, and innovation (including AI)
For 2026, Lacy said same-store expense growth is expected to be 3.75% at the midpoint, driven primarily by real estate taxes, repairs and maintenance, and administrative and marketing costs. He said 2025 tax appeal success created a tougher comparison and that 2026 real estate tax growth is expected to approximate the long-term average in the high-3% range. He added that improved retention in 2025 held repair and maintenance growth below long-term averages, and suggested there may be an opportunity for repairs and maintenance to come in better than the current forecast if retention continues to improve.
On revenue beyond rent, Lacy said innovation and other operating initiatives are expected to contribute approximately 45 basis points to 2026 same-store revenue growth, equating to about $10 million and nearly 5% year-over-year growth for that line item. He cited the rollout of property-wide Wi-Fi and value-added resident services as key drivers. In Q&A, he also pointed to initiatives including parking, package lockers, storage optimization, and efforts to improve pet rent compliance, noting pet rent currently totals about $800,000 per month and that UDR had identified roughly 2,000 pets not paying rent across the portfolio.
Management also emphasized ongoing investments in technology. Lacy discussed multiple AI-related pilots, including using AI to analyze customer experience and maintenance data, identify reimbursement billing issues from large datasets, and flag at-risk leasing situations earlier based on resident payment history and eviction trends.
Separately, Toomey announced that Ellen Goitia joined UDR’s board and said she brings accounting and corporate governance experience from senior roles at KPMG and service on several boards.
About United Dominion Realty Trust (NYSE:UDR)
United Dominion Realty Trust (NYSE: UDR) is a publicly traded real estate investment trust specializing in the ownership, management, acquisition, development and redevelopment of multifamily apartment communities. The company’s core focus is on Class A and Class A–plus residential properties, offering a diverse portfolio designed to meet the evolving needs of renters. UDR employs a full-service management platform to oversee daily operations, property maintenance, leasing, and resident services, ensuring consistency and quality across its holdings.
UDR’s business activities encompass ground-up development, strategic property redevelopment, and selective acquisitions.
