Exhibit 99.1

 

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Table of Contents
Earnings Press Release			2
Condensed Consolidated Financial Statements			8
Schedule 1: Reconciliation of FFO, Core FFO, and AFFO			10
Schedule 2: Capital Structure Information			11
Schedule 3: Operating Information by Home Portfolio			14
Schedule 4: Home Characteristics by Market			16
Schedule 5: Same Store Operating Information by Market			17
Schedule 6: Adjusted Property Management and G&A Reconciliation			24
Schedule 7: Acquisitions and Dispositions			25
Schedule 8: History of Same Store Total Cost to Maintain			26
Schedule 9: Guidance Information			27
Glossary and Reconciliations			28

 

Q2 2017 Earnings Release and Supplemental Information - page 1

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Earnings Press Release

 

 

Invitation Homes Reports Second Quarter 2017 Results

Dallas, TX, August 10, 2017 — Invitation Homes Inc. (NYSE: INVH) (“Invitation Homes” or the “Company”), a leading owner and operator of single-family homes for lease in the United States, today announced its second quarter 2017 financial and operating results.

Second Quarter 2017 Highlights

 

•

Year-over-year, total revenues increased 5.1% to $242 million, total property operating and maintenance expenses increased 1.7% to $93 million, net income increased to $6 million, and total NOI increased 7.3% to $149 million.

 

•

Same Store NOI grew 6.3% year-over-year on 4.6% Same Store revenue growth and 1.9% Same Store operating expense growth. Excluding the impact of property taxes attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable, Same Store NOI growth in second quarter 2017 would have been 6.9%.

 

•

Same Store Core NOI margin increased to 62.9% in the second quarter of 2017 from 61.5% in the second quarter of 2016. Excluding the impact of property taxes attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable, Same Store Core NOI margin in second quarter 2017 would have been 63.2%.

 

•

Same Store blended net effective rental rate growth was 5.1% on leases signed in the second quarter of 2017.

 

•

Same Store average occupancy was 95.9%.

 

•

Same Store other property income grew 22.4% year-over-year.

 

•

Closed on a $1.0 billion, ten-year, 4.2% fixed rate mortgage loan, with principal and interest payments guaranteed by Fannie Mae.

 

•

Prepaid $930 million of mortgage debt with Fannie Mae proceeds, and an additional $100 million with excess cash flow.

Chief Executive Officer John Bartling comments: “Invitation Homes continued to achieve strong internal NOI growth in the second quarter of 2017. As expected, new lease rental rate growth accelerated seasonally from the first quarter to the second quarter. In addition, we continued to make progress on our strategic operational initiatives related to lease expiration optimization, other income opportunities, and cost efficiency.”

“Supply/demand fundamentals remain favorable, particularly in the Western US, and we believe our differentiated locations, product, service, and professionals position us well to capitalize on these industry tailwinds. We remain on track to achieve 6.5% to 7.5% Same Store NOI growth for the full year.”

 

Q2 2017 Earnings Release and Supplemental Information - page 2

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Financial Results

Net Income (Loss), FFO, Core FFO, and AFFO Per Share — Diluted

 

		Q2 2017				YTD 2017
Net income (loss) (1)		$	0.02			$	(0.06	)
FFO (2)			0.20				0.23
Core FFO (2)			0.25				0.50
AFFO (2)			0.21				0.43

 

(1)

No shares of common stock were outstanding prior to the close of the Company’s initial public offering. As such, net loss per share for YTD 2017 has been calculated based on operating results for the period February 1, 2017 through June 30, 2017, and the weighted average number of shares outstanding during that period, in accordance with GAAP.

(2)

FFO, Core FFO, and AFFO per share for YTD 2017 have been calculated based on operating results for the full period from January 1, 2017 through June 30, 2017, and as if weighted average shares outstanding from February 1, 2017 through June 30, 2017 were outstanding for the full period from January 1, 2017 through June 30, 2017.

Net Income (Loss)

Net income for the three months ended June 30, 2017 was $5.5 million, an increase of $25.2 million from the prior year’s net loss. The increase in net income (loss) was primarily due to higher revenues, lower interest expense, and an increase in net gain on sale of property, partially offset by higher total operating expenses. The increase in total operating expenses included a $4.1 million increase in non-recurring G&A and property management expense items including share-based compensation, IPO costs, and severance expense. Exclusive of these non-recurring G&A and property management items, net income (loss) improved by $29.3 million from the prior year.

Net loss for the six months ended June 30, 2017 was $36.9 million, an increase of $7.2 million from the prior year. The increase in net loss was primarily due to a $51.0 million increase in non-recurring or non-cash general and administrative and property management items including share-based compensation, IPO costs, and severance expense. Exclusive of non-recurring G&A and property management items, net income (loss) improved by $43.7 million from the prior year, primarily due to higher revenues, lower interest expense, and an increase in net gain on sale. For details, see the Condensed Consolidated Statements of Operations in this press release.

Core FFO

Year-over-year, Core FFO for the three months ended June 30, 2017 increased 17.9% to $77.2 million, primarily due to an increase in NOI, driven by higher revenues. Revenue growth was driven by an increase in average rental rate per home that more than offset a slight decline in home count. Lower interest expense, net of non-cash interest, also contributed to the increase in Core FFO. For a reconciliation of net income (loss) to Core FFO, see Schedule 1 of the Supplemental Financial Information.

Core FFO for the six months ended June 30, 2017 increased 19.7% to $155.4 million, primarily due to an increase in NOI, driven by higher revenues. Revenue growth was driven by an increase in average rental rate per home and higher occupancy that more than offset a slight decline in home count. Lower interest expense, net of non-cash interest, also contributed to the increase in Core FFO. For a reconciliation of net income (loss) to Core FFO, see Schedule 1 of the Supplemental Financial Information.

AFFO

Year-over-year, AFFO for the three months ended June 30, 2017 increased 21.5% to $65.6 million, primarily driven by the increase in Core FFO described above.

AFFO for the six months ended June 30, 2017 increased 25.9% to $134.5 million, primarily driven by the increase in Core FFO described above, as well as a 9.0% decline in recurring capital expenditures. For a reconciliation of net income (loss) to AFFO per share, see Schedule 1 of the Supplemental Financial Information.

 

Q2 2017 Earnings Release and Supplemental Information - page 3

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Operating Results

Same Store Operating Results Snapshot

 

Number of homes in Same Store portfolio:			42,904
		Q2 2017				Q2 2016				YTD 2017				YTD 2016
Revenue growth (year-over-year) (1)			4.6	%			5.1	%			4.7	%			5.1	%
Operating Expense growth (year-over-year) (1)			1.9	%			0.4	%			2.4	%			1.5	%
NOI growth (year-over-year) (1)			6.3	%			8.4	%			6.1	%			7.4	%
Core NOI margin			62.9	%			61.5	%			63.6	%			62.4	%
Average occupancy (2)			95.9	%			96.4	%			95.8	%			96.4	%
Turnover rate (annualized)			38.7	%			38.8	%			35.2	%			34.9	%
Net effective rental rate growth (lease-over-lease):
New leases			4.9	%			7.2	%			4.2	%			6.1	%
Renewals			5.1	%			5.4	%			5.2	%			5.3	%
Blended			5.1	%			6.2	%			4.8	%			5.6	%

 

(1)	Same Store revenue, operating expense, and NOI growth for Q2 2016 and YTD 2016 are for the prior year’s same store pool of 36,469 homes.

(2)	For the total portfolio, occupancy decreased to 95.0% in Q2 2017 from 95.1% in Q2 2016, and increased to 95.0% in YTD 2017 from 94.8% in YTD 2016.

Same Store NOI

For the Same Store portfolio of 42,904 homes, second quarter 2017 Same Store NOI increased 6.3% year-over-year on Same Store revenue growth of 4.6% and Same Store expense growth of 1.9%. As a result, Core NOI margin increased to 62.9% in the second quarter of 2017 from 61.5% in the second quarter of 2016. Excluding the impact of property taxes attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable, Same Store NOI growth in second quarter 2017 would have been 6.9%, and Same Store Core NOI margin would have been 63.2%.

YTD 2017 Same Store NOI increased 6.1% year-over-year on Same Store revenue growth of 4.7% and Same Store expense growth of 2.4%. As a result, Core NOI margin increased to 63.6% in YTD 2017 from 62.4% in YTD 2016.

Same Store Revenues

Second quarter 2017 Same Store revenue growth of 4.6% was driven by a 4.3% increase in average monthly rent and a 22.4% increase in other property income, partially offset by a 0.5% decline in average occupancy to 95.9%.

YTD 2017 Same Store revenue growth of 4.7% was driven by a 4.4% increase in average monthly rent and a 22.3% increase in other property income, partially offset by a 0.6% decline in average occupancy to 95.8%.

Same Store Expenses

Second quarter 2017 Same Store expenses increased 1.9% year-over-year, driven primarily by 11.3% higher property taxes. California property tax reassessments related to the IPO became estimable in second quarter 2017, and the incremental taxes accrued in the first six months of 2017 for expected reassessments were booked entirely in second quarter 2017. Excluding the impact of property taxes attributable to first quarter 2017 that were booked in second quarter 2017, Same Store property taxes in second quarter 2017 would have increased by 9.1%, and Same Store expenses would have increased by 1.0%. Controllable expenses were 3.9% lower year-over-year, driven primarily by an 18.8% decline in personnel expense. Insurance expense was also lower by 23.8% year-over-year.

 

Q2 2017 Earnings Release and Supplemental Information - page 4

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YTD 2017 Same Store expenses increased 2.4% year-over-year, driven primarily by 9.2% higher property taxes. Controllable expenses were 1.9% lower year-over-year, driven primarily by a 17.4% decline in personnel costs. Insurance expense was also lower by 17.8% year-over-year.

Investment Management Activity

In the second quarter of 2017, the Company acquired 229 homes for $64.1 million, including estimated renovation cost, and sold 422 homes for gross proceeds of $58.7 million, resulting in total portfolio home count at June 30, 2017 of 47,725 homes. Dispositions in the second quarter of 2017 resulted in a gain on sale, net of tax, of approximately $10.2 million.

Year-to-date, the Company acquired 350 homes for $95.3 million, including estimated renovation cost, and sold 923 homes for gross proceeds of $136.4 million. Dispositions year-to-date resulted in a gain on sale, net of tax, of approximately $24.5 million.

Balance Sheet and Capital Markets Activity

At June 30, 2017, the Company had $1,159 million in availability through a combination of unrestricted cash and undrawn capacity on its credit facility.

The Company’s total indebtedness at June 30, 2017 was $5,681 million, consisting of $4,181 million of secured debt and $1,500 million of unsecured debt. Weighted average years to maturity at quarter end was 4.5 years, with no debt scheduled to mature before September 2019. 80% of debt at quarter end was fixed rate or swapped to fixed rate, and the weighted average interest rate on total debt during the quarter was 3.7%.

During the quarter, as previously announced, the Company closed a ten-year fixed rate securitization loan with a total principal amount of $1,000 million. The securitization loan is comprised of two components. Class A certificates representing an indirect interest in the Class A component of the loan, which totaled $944.5 million and represented the entirety of the gross proceeds to the Company, were offered to investors, and feature principal and interest payments that benefit from a guaranty by Fannie Mae. Class B certificates representing an interest in the Class B component of the loan, which totaled $55.5 million, were retained by the Company to comply with the United States risk retention requirements. The total cost of funds for the loan is fixed at 4.23%. Structural features of the transaction include the right to substitute properties (subject to certain loan to value, debt service coverage, and geographic concentration tests being met), as well as the right to release properties from the loan by prepaying the loan in an amount equal to 105% to 120% of the allocated loan amount associated with any properties released (subject to certain loan to value, debt service coverage, and geographic concentration tests being met, as well as the payment of any yield maintenance amounts required). Additionally, twice during the first five years of the loan, the Company will have the ability to exercise special release rights to release properties from the collateral pool (without any prepayment of the underlying loan) to reset the size of the collateral pool based on asset appreciation and cash flow growth. Following any such special release, the allocated loan amounts related to the remaining homes in the collateral pool will be resized based on loan-level loan to value and debt service coverage tests, and the remaining collateral pool must continue to meet certain geographic concentration tests. Net proceeds of approximately $930 million were used to repay the remaining outstanding balance of the IH1 2014-1 securitization and to voluntarily prepay $510 million of the IH1 2014-3 securitization.

In addition, as previously announced, the Company repaid an additional $100 million of the IH1 2014-3 securitization with cash on hand in June 2017.

 

Q2 2017 Earnings Release and Supplemental Information - page 5

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Full Year 2017 Guidance

2017 Guidance ⁽¹⁾

 

		FY 2017
		Guidance
Core FFO per share – diluted (2)		$0.96 - $1.04
AFFO per share – diluted (2)		$0.80 - $0.88
Same Store revenue growth		4.75% - 5.25%
Same Store operating expense growth		1.50% - 2.00%
Same Store NOI growth		6.50% - 7.50%
Same Store Core NOI margin		63.0% - 64.0%

 

(1)	Guidance excludes any potential impact from investment activity.

(2)	Core FFO and AFFO guidance is for operating results for the full year from January 1, 2017 through December 31, 2017, and assumes that estimated weighted average shares outstanding from February 1, 2017 through December 31, 2017 were outstanding for the full year 2017.

Note: The Company does not provide guidance for the most comparable GAAP financial measures of net income (loss), total revenues, and property operating and maintenance, or a reconciliation of the forward-looking non-GAAP financial measures of Core FFO per share, AFFO per share, Same Store revenue growth, Same Store operating expense growth, Same Store NOI growth, and Same Store Core NOI margin to the comparable GAAP financial measures because it is unable to reasonably predict certain items contained in the GAAP measures, including non-recurring and infrequent items that are not indicative of the Company’s ongoing operations. Such items include, but are not limited to, impairment on depreciated real estate assets, net (gain)/loss on sale of previously depreciated real estate assets, share-based compensation, casualty loss, non-Same Store revenues, and non-Same Store operating expenses. These items are uncertain, depend on various factors, and could have a material impact on our GAAP results for the guidance period.

Supplemental Information

The full text of the Earnings Release and Supplemental Information referenced in this release are available on Invitation Homes’ Investor Relations website at ir.invitationhomes.com.

Glossary & Reconciliations of Non-GAAP Financial Operating Measures

Financial and operating measures found in the Earnings Release and the Supplemental Information include certain measures used by Invitation Homes management that are measures not defined under accounting principles generally accepted in the United States (“GAAP”). These measures are defined in the Glossary in the Supplemental Information and, as applicable, reconciled to the most comparable GAAP measures.

About Invitation Homes

Invitation Homes is a leading owner and operator of single-family homes for lease, offering residents high-quality homes in desirable neighborhoods across America. With nearly 50,000 homes for lease in 13 markets across the country, Invitation Homes is meeting changing lifestyle demands by providing residents access to updated homes with features they value, such as close proximity to jobs and access to good schools. The company’s mission, “Together with you, we make a house a home,” reflects its commitment to high-touch service that continuously enhances residents’ living experiences and provides homes where individuals and families can thrive.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 6

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Investor Relations Contact

Greg Van Winkle

Phone: 844.456.INVH (4684)

Email: IR@InvitationHomes.com

Media Relations Contact

Claire Parker

Phone: 202.257.2329

Email: Media@InvitationHomes.com

Forward-Looking Statements

This press release contains 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”), which include, but are not limited to, statements related to the Company’s expectations regarding the performance of the Company’s business, its financial results, its liquidity and capital resources, and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks inherent to the single-family rental industry sector and the Company’s business model, macroeconomic factors beyond the Company’s control, competition in identifying and acquiring the Company’s properties, competition in the leasing market for quality residents, increasing property taxes, homeowners’ association fees and insurance costs, the Company’s dependence on third parties for key services, risks related to evaluation of properties, poor resident selection and defaults and non-renewals by the Company’s residents, performance of the Company’s information technology systems, and risks related to the Company’s indebtedness. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Additional factors that could cause the Company’s results to differ materially from those described in the forward-looking statements can be found under the section entitled “Part I-Item 1A. Risk Factors,” of the Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed with the Securities and Exchange Commission (the “SEC”), as such factors may be updated from time to time in the Company’s periodic filings with the SEC, which are accessible on the SEC’s website at http://www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company’s filings with the SEC. The forward-looking statements speak only as of the date of this press release, and we expressly disclaim any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except to the extent otherwise required by law.

 

Q2 2017 Earnings Release and Supplemental Information - page 7

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Condensed Consolidated Balance Sheets

($ in thousands, except per share amounts)
		June 30, 2017				December 31, 2016
		(unaudited)
Assets:
Investments in single-family residential properties:
Land		$	2,716,934			$	2,703,388
Building and improvements			7,116,587				7,091,457
			9,833,521				9,794,845
Less: accumulated depreciation			(917,961	)			(792,330	)
Investments in single-family residential properties, net			8,915,560				9,002,515
Cash and cash equivalents			158,934				198,119
Restricted cash			138,264				222,092
Other assets, net			306,568				309,625
Total assets		$	9,519,326			$	9,732,351
Liabilities:
Mortgage loans, net		$	4,158,666			$	5,254,738
Term loan facility, net			1,486,529				—
Credit facilities, net			—				2,315,541
Accounts payable and accrued expenses			110,919				88,052
Resident security deposits			88,781				86,513
Other liabilities			30,460				30,084
Total liabilities			5,875,355				7,774,928
Equity:
Shareholders’ equity
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding at June 30, 2017			—				—
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 310,376,634 outstanding at June 30, 2017			3,104				—
Additional paid-in-capital			3,675,094				—
Accumulated deficit			(38,799	)			—
Accumulated other comprehensive income			4,572				—
Total shareholders’ equity			3,643,971				—
Combined equity			—				1,957,423
Total equity			3,643,971				1,957,423
Total liabilities and equity		$	9,519,326			$	9,732,351

 

Q2 2017 Earnings Release and Supplemental Information - page 8

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Condensed Consolidated Statements of Operations

($ in thousands, except per share amounts) (unaudited)

 

		Q2 2017				Q2 2016				YTD 2017				YTD 2016
Revenues:
Rental revenues		$	228,504			$	219,354			$	454,600			$	433,677
Other property income			13,712				11,142				26,366				21,321
Total revenues			242,216				230,496				480,966				454,998
Operating expenses:
Property operating and maintenance			92,840				91,281				181,008				176,248
Property management expense			9,135				7,530				20,584				14,923
General and administrative			18,426				15,408				76,692				30,768
Depreciation and amortization			67,515				66,079				135,092				131,781
Impairment and other			706				546				1,910				363
Total operating expenses			188,622				180,844				415,286				354,083
Operating income			53,594				49,652				65,680				100,915
Other income (expenses):
Interest expense			(57,358	)			(70,523	)			(125,930	)			(140,800	)
Other, net			(869	)			185				(1,095	)			32
Total other income (expenses)			(58,227	)			(70,338	)			(127,025	)			(140,768	)
Loss from continuing operations			(4,633	)			(20,686	)			(61,345	)			(39,853	)
Gain on sale of property, net of tax			10,162				1,020				24,483				10,212
Net income (loss)		$	5,529			$	(19,666	)		$	(36,862	)		$	(29,641	)
		Q2 2017								February 1, 2017 through June 30, 2017
Net income (loss) available to common shareholders — basic and diluted		$	5,420							$	(20,092	)
Weighted average common shares outstanding — basic			311,771,221								311,723,463
Weighted average common shares outstanding — diluted			312,271,578								311,723,463
Net income (loss) per common share — basic		$	0.02							$	(0.06	)
Net income (loss) per common share — diluted		$	0.02							$	(0.06	)
Dividends declared per common share		$	0.06							$	0.06

 

Q2 2017 Earnings Release and Supplemental Information - page 9

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Supplemental Schedule 1

 

Reconciliation of FFO, Core FFO, and AFFO

($ in thousands, except per share amounts) (unaudited)

 

FFO Reconciliation		Q2 2017				Q2 2016				YTD 2017				YTD 2016
Net income (loss) available to common shareholders		$	5,420			$	(19,666	)		$	(36,971	)		$	(29,641	)
Net income (loss) available to participating securities			109				—				109				—
Depreciation and amortization on real estate assets			66,699				64,775				133,352				129,184
Impairment on depreciated real estate investments			95				519				1,132				519
Net gain on sale of previously depreciated investments in real estate			(10,162	)			(1,020	)			(24,483	)			(10,212	)
FFO		$	62,161			$	44,608			$	73,139			$	89,850
Core FFO Reconciliation		Q2 2017				Q2 2016				YTD 2017				YTD 2016
FFO		$	62,161			$	44,608			$	73,139			$	89,850
Noncash interest expense			5,137				15,622				20,271				29,816
Share-based compensation expense			8,216				4,106				52,460				8,312
Offering related expenses			656				—				8,287				—
Severance expense			392				1,102				437				1,908
Casualty losses, net			611				27				778				(156	)
Acquisition costs			—				7				—				42
Core FFO		$	77,173			$	65,472			$	155,372			$	129,772
AFFO Reconciliation		Q2 2017				Q2 2016				YTD 2017				YTD 2016
Core FFO		$	77,173			$	65,472			$	155,372			$	129,772
Recurring capital expenditures			(11,605	)			(11,495	)			(20,834	)			(22,907	)
AFFO		$	65,568			$	53,977			$	134,538			$	106,865
Weighted average common shares outstanding — diluted (1)			312,271,578								311,723,463
FFO per share — diluted (1)		$	0.20							$	0.23
Core FFO per share — diluted (1)		$	0.25							$	0.50
AFFO per share — diluted (1)		$	0.21							$	0.43

 

(1)

No shares of common stock were outstanding prior to the close of the Company’s initial public offering. For YTD 2017, FFO, Core FFO, and AFFO per share have been calculated based on operating results for the full period from January 1, 2017 through June 30, 2017, and as if weighted average shares outstanding from February 1, 2017 through June 30, 2017 were outstanding for the full period from January 1, 2017 through June 30, 2017.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 10

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Supplemental Schedule 2(a)

 

Diluted Shares Outstanding

(unaudited)

 

Total Shares of Common Stock and Equivalents — Diluted		Q2 2017				YTD 2017
Weighted average amounts for net income (loss) (1)			312,271,578				311,723,463
Weighted average amounts for FFO, Core FFO, and AFFO (1)			312,271,578				311,723,463
Period end amounts for FFO, Core FFO, and AFFO			312,560,734				312,560,734

 

(1)	No shares of common stock were outstanding prior to the close of the Company’s initial public offering. As such, YTD 2017 weighted average shares outstanding are for the period February 1, 2017 through June 30, 2017.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 11

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Supplemental Schedule 2(b)

 

 

 

Debt Structure and Leverage Ratios — June 30, 2017

($ in thousands) (unaudited)

Debt Structure		Balance				% of Total				Wtd Avg Interest Rate				Wtd Avg Years to Maturity
Secured:
Fixed		$	1,000,000				17.6	%			4.2	%			9.9
Floating — swapped to fixed			2,020,000				35.6	%			3.7	%			3.0
Floating			1,161,037				20.4	%			3.3	%			2.4
Total secured			4,181,037				73.6	%			3.7	%			4.5
Unsecured:
Floating — swapped to fixed			1,500,000				26.4	%			3.8	%			4.6
Total unsecured			1,500,000				26.4	%			3.8	%			4.6
Total Debt:
Fixed + floating swapped to fixed			4,520,000				79.6	%			3.8	%			5.1
Floating			1,161,037				20.4	%			3.3	%			2.4
Total debt			5,681,037				100.0	%			3.7	%			4.5
Unamortized discount on note payable			(3,521	)
Deferred financing costs			(32,321	)
Total Debt per Balance Sheet			5,645,195
Retained and repurchased certificates			(234,052	)
Cash, ex-security deposits (1)			(208,327	)
Deferred financing costs			32,321
Unamortized discount on note payable			3,521
Net debt		$	5,238,658
Leverage Ratios		Q2 2017
Fixed charge coverage ratio			2.5x
Net debt / annualized Adjusted EBITDA			10.0x

 

(1)	Represents cash and cash equivalents and the non-security deposit portion of restricted cash.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 12

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Supplemental Schedule 2(c)

 

 

 

Debt Maturity Schedule — June 30, 2017

($ in thousands) (unaudited)

 

Debt Maturities, with Extensions (1)		Secured Debt				Unsecured Debt				Revolving Credit Facility				Balance				% of Total				Wtd Avg Interest Rate (2)
2017		$	—			$	—			$	—			$	—				—	%			—	%
2018			—				—				—				—				—	%			—	%
2019			852,157				—				—				852,157				15.0	%			3.2	%
2020			2,328,880				—				—				2,328,880				41.0	%			3.7	%
2021			—				—				—				—				—	%			—	%
2022			—				1,500,000				—				1,500,000				26.4	%			3.8	%
2023			—				—				—				—				—	%			—	%
2024			—				—				—				—				—	%			—	%
2025			—				—				—				—				—	%			—	%
2026			—				—				—				—				—	%			—	%
2027			1,000,000				—				—				1,000,000				17.6	%			4.2	%
			4,181,037				1,500,000				—				5,681,037				100.0	%			3.7	%
Unamortized discount on note payable			(3,521	)			—				—				(3,521	)
Deferred financing costs			(18,850	)			(13,471	)			—				(32,321	)
Total per Balance Sheet		$	4,158,666			$	1,486,529			$	—			$	5,645,195

 

(1)	Assumes all extension options are exercised.

(2)	Includes impact of interest rate swaps.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 13

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Supplemental Schedule 3(a)

 

 

 

Summary of Property Operations by Home Portfolio

($ in thousands) (unaudited)

 

Number of Homes, period-end		Q2 2017
Same Store portfolio			42,904
Non-Same Store portfolio			4,821
Total			47,725
Revenues		Q2 2017				Q2 2016				Change YoY				YTD 2017				YTD 2016				Change YoY
Same Store portfolio		$	219,638			$	210,014				4.6	%		$	435,510			$	416,112				4.7	%
Non-Same Store portfolio			22,578				20,482				10.2	%			45,456				38,886				16.9	%
Total		$	242,216			$	230,496				5.1	%		$	480,966			$	454,998				5.7	%
Operating expenses (1)		Q2 2017				Q2 2016				Change YoY				YTD 2017				YTD 2016				Change YoY
Same Store portfolio		$	83,985			$	82,440				1.9	%		$	163,124			$	159,311				2.4	%
Non-Same Store portfolio			8,855				8,841				0.2	%			17,884				16,937				5.6	%
Total		$	92,840			$	91,281				1.7	%		$	181,008			$	176,248				2.7	%
Net Operating Income (1)		Q2 2017				Q2 2016				Change YoY				YTD 2017				YTD 2016				Change YoY
Same Store portfolio		$	135,653			$	127,574				6.3	%		$	272,386			$	256,801				6.1	%
Non-Same Store portfolio			13,723				11,641				17.9	%			27,572				21,949				25.6	%
Total		$	149,376			$	139,215				7.3	%		$	299,958			$	278,750				7.6	%

 

(1)

Total operating expenses and total Net Operating Income in Q2 2017 include an incremental $800 of property taxes attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable. Of this amount, $ 728 is included in the Same Store portfolio, and $72 is included in the Non-Same Store portfolio.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 14

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Supplemental Schedule 3(b)

 

 

 

Same Store Portfolio Operating Detail

($ in thousands) (unaudited)

 

		Q2 2017				Q2 2016				Change YoY				Q1 2017				Change Seq				YTD 2017				YTD 2016				Change YoY
Revenues:
Rental revenues		$	207,233			$	199,883				3.7	%		$	204,589				1.3	%		$	411,822			$	396,751				3.8	%
Other property income			12,405				10,131				22.4	%			11,283				9.9	%			23,688				19,361				22.3	%
Total revenues			219,638				210,014				4.6	%			215,872				1.7	%			435,510				416,112				4.7	%
Less: Resident recoveries (1)			(3,873	)			(2,446	)			58.3	%			(3,463	)			11.8	%			(7,336	)			(4,877	)			50.4	%
Core revenues			215,765				207,568				3.9	%			212,409				1.6	%			428,174				411,235				4.1	%
Fixed Expenses:
Property taxes (2)			37,828				33,994				11.3	%			36,529				3.6	%			74,357				68,082				9.2	%
Insurance expenses			4,190				5,502				(23.8	)%			4,215				(0.6	)%			8,405				10,223				(17.8	)%
HOA expenses			5,628				5,141				9.5	%			5,189				8.5	%			10,817				10,118				6.9	%
Controllable Expenses:
Repairs and maintenance			10,369				9,965				4.1	%			8,752				18.5	%			19,121				17,725				7.9	%
Personnel			9,329				11,489				(18.8	)%			9,634				(3.2	)%			18,963				22,947				(17.4	)%
Turnover			7,145				6,653				7.4	%			5,603				27.5	%			12,748				11,682				9.1	%
Utilities			4,322				4,008				7.8	%			4,265				1.3	%			8,587				7,372				16.5	%
Leasing and marketing (3)			3,611				4,070				(11.3	)%			3,438				5.0	%			7,049				8,226				(14.3	)%
Property administrative			1,563				1,618				(3.4	)%			1,514				3.2	%			3,077				2,936				4.8	%
Property operating and maintenance expenses (2)			83,985				82,440				1.9	%			79,139				6.1	%			163,124				159,311				2.4	%
Less: Resident recoveries (1)			(3,873	)			(2,446	)			58.3	%			(3,463	)			11.8	%			(7,336	)			(4,877	)			50.4	%
Core operating expenses (2)			80,112				79,994				0.1	%			75,676				5.9	%			155,788				154,434				0.9	%
Net Operating Income (2)		$	135,653			$	127,574				6.3	%		$	136,733				(0.8	)%		$	272,386			$	256,801				6.1	%
Same Store Metrics:
Core NOI margin (2)			62.9	%			61.5	%							64.4	%							63.6	%			62.4	%
Average occupancy			95.9	%			96.4	%							95.8	%							95.8	%			96.4	%
Turnover rate (annualized)			38.7	%			38.8	%							31.6	%							35.2	%			34.9	%

 

(1)

Q2 2017 and YTD 2017 resident recoveries include both utility cost recoveries and move-out cost recoveries. Q2 2016 and YTD 2016 resident recoveries include only utility cost recoveries, as move out cost recoveries were not tracked until the beginning of 2017. Same store utility cost recoveries were $2,466 in Q2 2017 and $4,914 in YTD 2017, versus $2,446 in Q2 2016 and $4,877 in YTD 2016.

(2)	Q2 2017 amounts include an incremental $ 728 of property taxes attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable.

(3)

Same Store leasing and marketing expense includes amortization of leasing commissions of $ 2,728, $ 3,098, $2,699, $5,426, and $ 6,527 for Q2 2017, Q2 2016, Q1 2017, YTD 2017, and YTD 2016, respectively. For the total portfolio, amortization of leasing commissions were $3,087, $ 3,482, $3,139, $6,226, and $ 7,212 for Q2 2017, Q2 2016, Q1 2017, YTD 2017, and YTD 2016, respectively.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 15

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Supplemental Schedule 4

 

Portfolio Characteristics — As of and for the Quarter Ended June 30, 2017 ⁽¹⁾

(unaudited)

 

		Number of Homes				Average Occupancy				Average Monthly Rent				Average Monthly Rent PSF				Percent of Revenue
Western United States:
Southern California			4,625				95.0	%		$	2,252			$	1.32				12.5	%
Northern California			2,857				96.3	%			1,765				1.12				6.7	%
Seattle			3,203				96.0	%			1,945				1.02				8.3	%
Phoenix			5,425				95.7	%			1,170				0.74				8.2	%
Las Vegas			959				94.5	%			1,453				0.75				1.7	%
Western US Subtotal			17,069				95.6	%			1,723				1.02				37.4	%
Florida:
South Florida			5,591				93.8	%			2,178				1.13				14.6	%
Tampa			4,900				95.2	%			1,590				0.81				9.7	%
Orlando			3,707				95.3	%			1,522				0.79				7.0	%
Jacksonville			1,958				95.3	%			1,565				0.78				3.8	%
Florida Subtotal			16,156				94.7	%			1,773				0.91				35.1	%
Southeast United States:
Atlanta			7,293				95.2	%			1,379				0.67				12.6	%
Charlotte			3,110				94.9	%			1,385				0.69				5.3	%
Southeast US Subtotal			10,403				95.1	%			1,381				0.67				17.9	%
Midwest United States:
Chicago			2,915				93.2	%			2,022				1.20				7.0	%
Minneapolis			1,182				95.3	%			1,770				0.89				2.6	%
Midwest US Subtotal			4,097				93.8	%			1,948				1.10				9.6	%
Total / Average			47,725				95.0	%		$	1,683			$	0.90				100.0	%
Same Store Total / Average			42,904				95.9	%		$	1,688			$	0.91				90.7	%

 

(1)	All data is for the total portfolio, unless otherwise noted.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 16

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Supplemental Schedule 5(a)

 

Same Store Revenue Growth Summary, YoY Quarter

($ in thousands, except avg. monthly rent) (unaudited)

 

						Avg. Monthly Rent												Avg. Occupancy												Total Revenue
YoY, Q2 2017		# Homes				Q2 2017				Q2 2016				Change				Q2 2017				Q2 2016				Change				Q2 2017				Q2 2016				Change
Western United States:
Southern California			4,122			$	2,232			$	2,117				5.4	%			95.8	%			96.8	%			(1.0	)%		$	27,144			$	25,939				4.6	%
Northern California			2,437				1,744				1,633				6.8	%			97.0	%			97.5	%			(0.5	)%			13,825				12,953				6.7	%
Seattle			2,771				1,946				1,819				7.0	%			96.7	%			97.2	%			(0.5	)%			17,483				16,261				7.5	%
Phoenix			4,595				1,172				1,101				6.4	%			96.5	%			97.2	%			(0.7	)%			17,012				16,008				6.3	%
Las Vegas			869				1,455				1,398				4.1	%			96.1	%			96.3	%			(0.2	)%			3,902				3,719				4.9	%
Western US Subtotal			14,794				1,722				1,623				6.1	%			96.4	%			97.1	%			(0.7	)%			79,366				74,880				6.0	%
Florida:
South Florida			5,206				2,188				2,116				3.4	%			94.6	%			96.3	%			(1.7	)%			33,372				32,477				2.8	%
Tampa			4,487				1,583				1,522				4.0	%			96.0	%			96.0	%			—	%			21,486				20,551				4.5	%
Orlando			3,317				1,510				1,433				5.4	%			96.5	%			96.9	%			(0.4	)%			15,308				14,440				6.0	%
Jacksonville			1,875				1,571				1,542				1.9	%			95.5	%			95.5	%			—	%			8,888				8,598				3.4	%
Florida Subtotal			14,885				1,775				1,712				3.7	%			95.6	%			96.3	%			(0.7	)%			79,054				76,066				3.9	%
Southeast United States:
Atlanta			6,509				1,390				1,338				3.9	%			95.9	%			96.6	%			(0.7	)%			27,102				26,029				4.1	%
Charlotte			2,728				1,365				1,315				3.8	%			96.1	%			96.3	%			(0.2	)%			11,189				10,742				4.2	%
Southeast US Subtotal			9,237				1,383				1,331				3.9	%			95.9	%			96.5	%			(0.6	)%			38,291				36,771				4.1	%
Midwest United States:
Chicago			2,814				2,024				2,002				1.1	%			94.7	%			93.7	%			1.0	%			16,490				16,143				2.1	%
Minneapolis			1,174				1,771				1,717				3.1	%			95.7	%			95.3	%			0.4	%			6,437				6,154				4.6	%
Midwest US Subtotal			3,988				1,949				1,917				1.7	%			95.0	%			94.1	%			0.9	%			22,927				22,297				2.8	%
Same Store Total / Average			42,904			$	1,688			$	1,618				4.3	%			95.9	%			96.4	%			(0.5	)%		$	219,638			$	210,014				4.6	%

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

 

Q2 2017 Earnings Release and Supplemental Information - page 17

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Supplemental Schedule 5(a) (Continued)

 

Same Store Revenue Growth Summary — Sequential Quarter

($ in thousands, except avg. monthly rent) (unaudited)

 

						Avg. Monthly Rent												Avg. Occupancy												Total Revenue
Seq, Q2 2017		# Homes				Q2 2017				Q1 2017				Change				Q2 2017				Q1 2017				Change				Q2 2017				Q1 2017				Change
Western United States:
Southern California			4,122			$	2,232			$	2,198				1.5	%			95.8	%			96.3	%			(0.5	)%		$	27,144			$	26,739				1.5	%
Northern California			2,437				1,744				1,713				1.8	%			97.0	%			97.3	%			(0.3	)%			13,825				13,614				1.5	%
Seattle			2,771				1,946				1,908				2.0	%			96.7	%			96.6	%			0.1	%			17,483				17,068				2.4	%
Phoenix			4,595				1,172				1,150				1.9	%			96.5	%			96.7	%			(0.2	)%			17,012				16,696				1.9	%
Las Vegas			869				1,455				1,443				0.8	%			96.1	%			95.3	%			0.8	%			3,902				3,849				1.4	%
Western US Subtotal			14,794				1,722				1,694				1.7	%			96.4	%			96.6	%			(0.2	)%			79,366				77,966				1.8	%
Florida:
South Florida			5,206				2,188				2,171				0.8	%			94.6	%			94.5	%			0.1	%			33,372				32,889				1.5	%
Tampa			4,487				1,583				1,566				1.1	%			96.0	%			95.6	%			0.4	%			21,486				21,086				1.9	%
Orlando			3,317				1,510				1,488				1.5	%			96.5	%			96.8	%			(0.3	)%			15,308				14,980				2.2	%
Jacksonville			1,875				1,571				1,558				0.8	%			95.5	%			93.8	%			1.7	%			8,888				8,632				3.0	%
Florida Subtotal			14,885				1,775				1,757				1.0	%			95.6	%			95.2	%			0.4	%			79,054				77,587				1.9	%
Southeast United States:
Atlanta			6,509				1,390				1,377				0.9	%			95.9	%			95.9	%			—	%			27,102				26,638				1.7	%
Charlotte			2,728				1,365				1,345				1.5	%			96.1	%			95.2	%			0.9	%			11,189				10,954				2.1	%
Southeast US Subtotal			9,237				1,383				1,368				1.1	%			95.9	%			95.7	%			0.2	%			38,291				37,592				1.9	%
Midwest United States:
Chicago			2,814				2,024				2,013				0.5	%			94.7	%			94.8	%			(0.1	)%			16,490				16,396				0.6	%
Minneapolis			1,174				1,771				1,747				1.4	%			95.7	%			96.3	%			(0.6	)%			6,437				6,331				1.7	%
Midwest US Subtotal			3,988				1,949				1,934				0.8	%			95.0	%			95.2	%			(0.2	)%			22,927				22,727				0.9	%
Same Store Total / Average			42,904			$	1,688			$	1,668				1.2	%			95.9	%			95.8	%			0.1	%		$	219,638			$	215,872				1.7	%

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 18

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Supplemental Schedule 5(a) (Continued)

 

Same Store Revenue Growth Summary, YoY Year-To-Date

($ in thousands, except avg. monthly rent) (unaudited)

 

						Avg. Monthly Rent												Avg. Occupancy												Total Revenue
YoY, YTD 2017		# Homes				YTD 2017				YTD 2016				Change				YTD 2017				YTD 2016				Change				YTD 2017				YTD 2016				Change
Western United States:
Southern California			4,122			$	2,215			$	2,101				5.4	%			96.1	%			96.7	%			(0.6	)%		$	53,883			$	51,289				5.1	%
Northern California			2,437				1,729				1,616				7.0	%			97.2	%			97.7	%			(0.5	)%			27,439				25,593				7.2	%
Seattle			2,771				1,927				1,802				6.9	%			96.6	%			97.0	%			(0.4	)%			34,551				32,143				7.5	%
Phoenix			4,595				1,161				1,093				6.2	%			96.6	%			97.2	%			(0.6	)%			33,708				31,682				6.4	%
Las Vegas			869				1,449				1,390				4.2	%			95.7	%			96.1	%			(0.4	)%			7,751				7,363				5.3	%
Western US Subtotal			14,794				1,708				1,609				6.2	%			96.5	%			97.0	%			(0.5	)%			157,332				148,070				6.3	%
Florida:
South Florida			5,206				2,179				2,105				3.5	%			94.6	%			96.3	%			(1.7	)%			66,261				64,501				2.7	%
Tampa			4,487				1,575				1,516				3.9	%			95.8	%			96.3	%			(0.5	)%			42,572				40,762				4.4	%
Orlando			3,317				1,499				1,428				5.0	%			96.6	%			96.9	%			(0.3	)%			30,288				28,642				5.7	%
Jacksonville			1,875				1,564				1,532				2.1	%			94.6	%			95.7	%			(1.1	)%			17,520				17,089				2.5	%
Florida Subtotal			14,885				1,766				1,704				3.6	%			95.4	%			96.4	%			(1.0	)%			156,641				150,994				3.7	%
Southeast United States:
Atlanta			6,509				1,384				1,330				4.1	%			95.9	%			96.7	%			(0.8	)%			53,740				51,638				4.1	%
Charlotte			2,728				1,355				1,309				3.5	%			95.7	%			96.2	%			(0.5	)%			22,143				21,357				3.7	%
Southeast US Subtotal			9,237				1,375				1,324				3.9	%			95.8	%			96.6	%			(0.8	)%			75,883				72,995				4.0	%
Midwest United States:
Chicago			2,814				2,019				1,984				1.8	%			94.7	%			93.7	%			1.0	%			32,886				31,913				3.0	%
Minneapolis			1,174				1,759				1,701				3.4	%			96.0	%			95.1	%			0.9	%			12,768				12,140				5.2	%
Midwest US Subtotal			3,988				1,941				1,900				2.2	%			95.1	%			94.1	%			1.0	%			45,654				44,053				3.6	%
Same Store Total / Average			42,904			$	1,678			$	1,607				4.4	%			95.8	%			96.4	%			(0.6	)%		$	435,510			$	416,112				4.7	%

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 19

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Supplemental Schedule 5(b)

 

 

Same Store NOI Growth and Margin Summary — YoY Quarter

($ in thousands) (unaudited)

 

		Total Revenue												Operating Expenses												Net Operating Income												Core NOI Margin
YoY, Q2 2017		Q2 2017				Q2 2016				Change				Q2 2017				Q2 2016				Change				Q2 2017				Q2 2016				Change				Q2 2017				Q2 2016
Western United States:
Southern California (1)		$	27,144			$	25,939				4.6	%		$	9,621			$	8,258				16.5	%		$	17,523			$	17,681				(0.9	)%			65.1	%			68.3	%
Northern California (1)			13,825				12,953				6.7	%			5,401				5,127				5.3	%			8,424				7,826				7.6	%			65.8	%			65.3	%
Seattle			17,483				16,261				7.5	%			6,228				6,107				2.0	%			11,255				10,154				10.8	%			69.3	%			66.9	%
Phoenix			17,012				16,008				6.3	%			4,718				4,710				0.2	%			12,294				11,298				8.8	%			72.9	%			70.6	%
Las Vegas			3,902				3,719				4.9	%			1,093				1,173				(6.8	)%			2,809				2,546				10.3	%			73.9	%			69.7	%
Western US Subtotal (1)			79,366				74,880				6.0	%			27,061				25,375				6.6	%			52,305				49,505				5.7	%			68.3	%			68.1	%
Florida:
South Florida			33,372				32,477				2.8	%			15,628				15,807				(1.1	)%			17,744				16,670				6.4	%			53.4	%			51.3	%
Tampa			21,486				20,551				4.5	%			8,777				9,003				(2.5	)%			12,709				11,548				10.1	%			59.7	%			56.2	%
Orlando			15,308				14,440				6.0	%			5,942				5,925				0.3	%			9,366				8,515				10.0	%			61.6	%			59.0	%
Jacksonville			8,888				8,598				3.4	%			3,560				3,523				1.1	%			5,328				5,075				5.0	%			60.4	%			59.0	%
Florida Subtotal			79,054				76,066				3.9	%			33,907				34,258				(1.0	)%			45,147				41,808				8.0	%			57.5	%			55.0	%
Southeast United States:
Atlanta			27,102				26,029				4.1	%			9,556				9,367				2.0	%			17,546				16,662				5.3	%			65.2	%			64.1	%
Charlotte			11,189				10,742				4.2	%			3,434				3,771				(8.9	)%			7,755				6,971				11.2	%			69.7	%			64.9	%
Southeast US Subtotal			38,291				36,771				4.1	%			12,990				13,138				(1.1	)%			25,301				23,633				7.1	%			66.5	%			64.3	%
Midwest United States:
Chicago			16,490				16,143				2.1	%			7,893				7,392				6.8	%			8,597				8,751				(1.8	)%			52.6	%			54.3	%
Minneapolis			6,437				6,154				4.6	%			2,134				2,277				(6.3	)%			4,303				3,877				11.0	%			69.2	%			65.2	%
Midwest US Subtotal			22,927				22,297				2.8	%			10,027				9,669				3.7	%			12,900				12,628				2.2	%			57.2	%			57.2	%
Same Store Total / Average (1)			$219,638				$210,014				4.6%				$83,985				$82,440				1.9%				$135,653				$127,574				6.3%				62.9%				61.5%

 

(1)	Q2 2017 amounts include an incremental $529 of property taxes in Southern California and $199 of property taxes in Northern California attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 20

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Supplemental Schedule 5(b) (Continued)

 

Same Store NOI Growth and Margin Summary — Sequential Quarter

($ in thousands) (unaudited)

 

		Total Revenue												Operating Expenses												Net Operating Income												Core NOI Margin
Seq, Q2 2017		Q2 2017				Q1 2017				Change				Q2 2017				Q1 2017				Change				Q2 2017				Q1 2017				Change				Q2 2017				Q1 2017
Western United States:
Southern California (1)		$	27,144			$	26,739				1.5	%		$	9,621			$	8,300				15.9	%		$	17,523			$	18,439				(5.0	)%			65.1	%			69.6	%
Northern California (1)			13,825				13,614				1.5	%			5,401				4,680				15.4	%			8,424				8,934				(5.7	)%			65.8	%			71.0	%
Seattle			17,483				17,068				2.4	%			6,228				6,332				(1.6	)%			11,255				10,736				4.8	%			69.3	%			67.7	%
Phoenix			17,012				16,696				1.9	%			4,718				4,575				3.1	%			12,294				12,121				1.4	%			72.9	%			73.1	%
Las Vegas			3,902				3,849				1.4	%			1,093				1,064				2.7	%			2,809				2,785				0.9	%			73.9	%			74.3	%
Western US Subtotal (1)			79,366				77,966				1.8	%			27,061				24,951				8.5	%			52,305				53,015				(1.3	)%			68.3	%			70.4	%
Florida:
South Florida			33,372				32,889				1.5	%			15,628				14,715				6.2	%			17,744				18,174				(2.4	)%			53.4	%			55.4	%
Tampa			21,486				21,086				1.9	%			8,777				8,222				6.8	%			12,709				12,864				(1.2	)%			59.7	%			61.4	%
Orlando			15,308				14,980				2.2	%			5,942				5,756				3.2	%			9,366				9,224				1.5	%			61.6	%			61.8	%
Jacksonville			8,888				8,632				3.0	%			3,560				3,273				8.8	%			5,328				5,359				(0.6	)%			60.4	%			62.4	%
Florida Subtotal			79,054				77,587				1.9	%			33,907				31,966				6.1	%			45,147				45,621				(1.0	)%			57.5	%			59.0	%
Southeast United States:
Atlanta			27,102				26,638				1.7	%			9,556				8,983				6.4	%			17,546				17,655				(0.6	)%			65.2	%			66.5	%
Charlotte			11,189				10,954				2.1	%			3,434				3,472				(1.1	)%			7,755				7,482				3.6	%			69.7	%			68.6	%
Southeast US Subtotal			38,291				37,592				1.9	%			12,990				12,455				4.3	%			25,301				25,137				0.7	%			66.5	%			67.1	%
Midwest United States:
Chicago			16,490				16,396				0.6	%			7,893				7,637				3.4	%			8,597				8,759				(1.8	)%			52.6	%			53.8	%
Minneapolis			6,437				6,331				1.7	%			2,134				2,130				0.2	%			4,303				4,201				2.4	%			69.2	%			68.5	%
Midwest US Subtotal			22,927				22,727				0.9	%			10,027				9,767				2.7	%			12,900				12,960				(0.5	)%			57.2	%			57.8	%
Same Store Total / Average (1)		$	219,638			$	215,872				1.7	%		$	83,985			$	79,139				6.1	%		$	135,653			$	136,733				(0.8	)%			62.9	%			64.4	%

 

(1)	Q2 2017 amounts include an incremental $529 of property taxes in Southern California and $199 of property taxes in Northern California attributable to first quarter 2017 that were booked in second quarter 2017 when California property tax reassessments related to the IPO became estimable.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 21

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Supplemental Schedule 5(b) (Continued)

 

Same Store NOI Growth and Margin Summary - YoY Year-To-Date

($ in thousands) (unaudited)

 

		Total Revenue												Operating Expenses												Net Operating Income												Core NOI Margin
YoY, YTD 2017		YTD 2017				YTD 2016				Change				YTD 2017				YTD 2016				Change				YTD 2017				YTD 2016				Change				YTD 2017				YTD 2016
Western United States:
Southern California		$	53,883			$	51,289				5.1	%		$	17,921			$	16,360				9.5	%		$	35,962			$	34,929				3.0	%			67.3	%			68.2	%
Northern California			27,439				25,593				7.2	%			10,081				9,317				8.2	%			17,358				16,276				6.6	%			68.4	%			68.7	%
Seattle			34,551				32,143				7.5	%			12,560				12,382				1.4	%			21,991				19,761				11.3	%			68.5	%			65.9	%
Phoenix			33,708				31,682				6.4	%			9,293				9,137				1.7	%			24,415				22,545				8.3	%			73.0	%			71.2	%
Las Vegas			7,751				7,363				5.3	%			2,157				2,266				(4.8	)%			5,594				5,097				9.8	%			74.1	%			70.4	%
Western US Subtotal			157,332				148,070				6.3	%			52,012				49,462				5.2	%			105,320				98,608				6.8	%			69.3	%			68.6	%
Florida:
South Florida			66,261				64,501				2.7	%			30,343				30,633				(0.9	)%			35,918				33,868				6.1	%			54.4	%			52.5	%
Tampa			42,572				40,762				4.4	%			16,999				17,235				(1.4	)%			25,573				23,527				8.7	%			60.5	%			57.7	%
Orlando			30,288				28,642				5.7	%			11,698				11,546				1.3	%			18,590				17,096				8.7	%			61.7	%			59.7	%
Jacksonville			17,520				17,089				2.5	%			6,833				6,736				1.4	%			10,687				10,353				3.2	%			61.4	%			60.6	%
Florida Subtotal			156,641				150,994				3.7	%			65,873				66,150				(0.4	)%			90,768				84,844				7.0	%			58.3	%			56.2	%
Southeast United States:
Atlanta			53,740				51,638				4.1	%			18,539				18,321				1.2	%			35,201				33,317				5.7	%			65.9	%			64.6	%
Charlotte			22,143				21,357				3.7	%			6,906				7,201				(4.1	)%			15,237				14,156				7.6	%			69.1	%			66.3	%
Southeast US Subtotal			75,883				72,995				4.0	%			25,445				25,522				(0.3	)%			50,438				47,473				6.2	%			66.8	%			65.1	%
Midwest United States:
Chicago			32,886				31,913				3.0	%			15,530				13,889				11.8	%			17,356				18,024				(3.7	)%			53.2	%			56.6	%
Minneapolis			12,768				12,140				5.2	%			4,264				4,288				(0.6	)%			8,504				7,852				8.3	%			68.8	%			67.1	%
Midwest US Subtotal			45,654				44,053				3.6	%			19,794				18,177				8.9	%			25,860				25,876				(0.1	)%			57.5	%			59.4	%
Same Store Total / Average		$	435,510			$	416,112				4.7	%		$	163,124			$	159,311				2.4	%		$	272,386			$	256,801				6.1	%			63.6	%			62.4	%

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 22

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Supplemental Schedule 5(c)

 

 

Same Store Lease-Over-Lease Rent Growth
(unaudited)
		Net Effective Rental Rate Growth - Q2 2017
		Renewal Leases				New Leases				Blended Average
Western United States:
Southern California			7.7	%			6.3	%			7.2	%
Northern California			7.2	%			9.0	%			7.8	%
Seattle			7.6	%			10.5	%			9.0	%
Phoenix			5.8	%			9.7	%			7.3	%
Las Vegas			3.2	%			3.5	%			3.3	%
Western US Average			7.0	%			8.2	%			7.4	%
Florida:
South Florida			4.4	%			2.2	%			3.5	%
Tampa			4.8	%			3.4	%			4.3	%
Orlando			5.4	%			6.4	%			5.8	%
Jacksonville			3.6	%			2.3	%			3.0	%
Florida Average			4.6	%			3.4	%			4.1	%
Southeast United States:
Atlanta			3.9	%			4.0	%			4.0	%
Charlotte			3.3	%			4.5	%			3.8	%
Southeast US Average			3.7	%			4.2	%			3.9	%
Midwest United States:
Chicago			2.9	%			1.0	%			2.2	%
Minneapolis			4.9	%			4.2	%			4.7	%
Midwest US Average			3.5	%			2.0	%			3.0	%
Same Store Total / Average			5.1	%			4.9	%			5.1	%

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 23

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Supplemental Schedule 6

 

 

 

Adjusted Property Management and G&A Reconciliation
($ in thousands) (unaudited)
Adjusted Property Management Expense		Q2 2017				Q2 2016				YTD 2017				YTD 2016
Property management expense (GAAP)		$	9,135			$	7,530			$	20,584			$	14,923
Adjustments:
Share-based compensation expense (1)			(1,336	)			(98	)			(5,309	)			(253	)
Adjusted property management expense		$	7,799			$	7,432			$	15,275			$	14,670
Adjusted G&A Expense		Q2 2017				Q2 2016				YTD 2017				YTD 2016
G&A expense (GAAP)		$	18,426			$	15,408			$	76,692			$	30,768
Adjustments:
Share-based compensation expense (2)			(6,880	)			(4,008	)			(47,151	)			(8,059	)
IPO costs			(656	)			—				(8,287	)			—
Severance expense			(392	)			(1,102	)			(437	)			(1,908	)
Adjusted G&A expense		$	10,498			$	10,298			$	20,817			$	20,801

 

(1)	For Q2 2017, includes $168 related to post-IPO grants and $1,166 related to IPO and pre-IPO grants. For YTD 2017, includes $168 related to post-IPO grants and $5,139 related to IPO and pre-IPO grants. For Q2 2016 and YTD 2016, consists entirely of IPO and pre-IPO grants.

(2)

For Q2 2017, includes $1,090 related to post-IPO awards, of which $934 is related to accelerated expense recognition as a result of certain employees reaching retirement eligibility, and $5,788 related to IPO and pre-IPO grants. For YTD 2017, includes $1,090 related to post-IPO awards, of which $934 is related to accelerated expense recognition as a result of certain employees reaching retirement eligibility, and $46,059 related to IPO and pre-IPO grants. For Q2 2016 and YTD 2016, consists entirely of IPO and pre-IPO grants.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 24

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Supplemental Schedule 7

 

 

Acquisitions and Dispositions — Q2 2017

(unaudited)

 

		As of 3/31/2017				Q2 2017 Acquisitions (1)								Q2 2017 Dispositions (2)								As of 6/30/2017
		Homes Owned				Homes Acq.				Avg. Estimated Invested Basis				Homes Sold				Average Sales Price				Homes Owned
Western United States:
Southern California			4,610				32			$	500,506				17			$	213,176				4,625
Northern California			2,866				5				350,117				14				211,929				2,857
Seattle			3,185				26				335,685				8				298,625				3,203
Phoenix			5,407				42				222,422				24				144,240				5,425
Las Vegas			950				11				260,480				2				162,500				959
Western US Subtotal			17,018				116				333,635				65				196,412				17,069
Florida:
South Florida			5,598				10				306,474				17				204,147				5,591
Tampa			4,915				6				255,932				21				174,900				4,900
Orlando			3,714				21				230,652				28				183,355				3,707
Jacksonville			1,964				—				—				6				167,571				1,958
Florida Subtotal			16,191				37				255,244				72				184,483				16,156
Southeast United States:
Atlanta			7,483				49				208,768				239				100,857				7,293
Charlotte			3,104				27				213,047				21				145,888				3,110
Southeast US Subtotal			10,587				76				210,288				260				104,494				10,403
Midwest United States:
Chicago			2,939				—				—				24				216,842				2,915
Minneapolis			1,183				—				—				1				295,000				1,182
Midwest US Subtotal			4,122				—				—				25				219,968				4,097
Total / Average			47,918				229			$	280,033				422			$	139,140				47,725

 

(1)	Estimated stabilized cap rates on acquisitions during the quarter averaged 5.4%. Stabilized cap rate represents forecast nominal NOI for the twelve months following stabilization, divided by estimated invested basis.

(2)	Cap rates on dispositions during the quarter averaged 3.1%. Disposition cap rate represents actual NOI recognized in the twelve months prior to the month of disposition, divided by sales price.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 25

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Supplemental Schedule 8

 

 

History of Same Store Total Cost to Maintain (Gross)

($ in thousands, except per home amounts) (unaudited)

 

Total ($ 000)		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Operating expense (gross):
R&M OpEx		$	10,369			$	8,752			$	9,521			$	10,852			$	9,965
Turn OpEx			7,145				5,603				5,346				7,510				6,653
Total operating expense			17,514				14,355				14,867				18,362				16,618
Capital expenditure:
R&M CapEx			7,333				5,610				6,347				9,694				7,323
Turn CapEx			3,530				2,656				2,869				3,476				3,338
Total capital expenditure			10,863				8,266				9,216				13,170				10,661
Total cost to maintain (gross):
R&M OpEx + CapEx			17,702				14,362				15,868				20,546				17,288
Turn OpEx + CapEx			10,675				8,259				8,215				10,986				9,991
Total cost to maintain		$	28,377			$	22,621			$	24,083			$	31,532			$	27,279
Per Home ($)		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Operating expense (gross):
R&M OpEx		$	242			$	204			$	222			$	253			$	232
Turn OpEx			166				131				125				175				155
Total operating expense			408				335				347				428				387
Capital expenditure:
R&M CapEx			171				131				148				226				171
Turn CapEx			83				62				67				81				78
Total capital expenditure			254				193				215				307				249
Total cost to maintain (gross):
R&M OpEx + CapEx			413				335				370				479				403
Turn OpEx + CapEx			249				193				192				256				233
Total cost to maintain		$	662			$	528			$	562			$	735			$	636
Per Turn Spend ($, Gross)		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Avg. OpEx per turn		$	1,799			$	1,742			$	1,610			$	1,726			$	1,664
Avg. CapEx per turn			889				826				864				799				835
Avg. total spend per turn		$	2,688			$	2,568			$	2,474			$	2,525			$	2,499

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 26

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Supplemental Schedule 9

 

 

2017 Guidance ⁽¹⁾

(unaudited)

 

Net Income (Loss), Core FFO, and AFFO per Share Guidance (2)		FY 2017 Guidance
Core FFO per share - diluted		$0.96 - $1.04
AFFO per share - diluted		$0.80 - $0.88
Same Store Guidance		FY 2017 Guidance
Revenue Growth		4.75% - 5.25%
Operating Expense Growth		1.50% - 2.00%
NOI Growth		6.50% - 7.50%
Core NOI margin		63.0% - 64.0%

 

(1)	Guidance excludes any potential impact from investment activity

(2)	Core FFO and AFFO guidance is for operating results for the full year from January 1, 2017 through December 31, 2017, and assumes that estimated weighted average shares outstanding from February 1, 2017 through December 31, 2017 were outstanding for the full year 2017.

Note: The Company does not provide guidance for the most comparable GAAP financial measures of net income (loss), total revenues, and property operating and maintenance, or a reconciliation of the forward-looking non-GAAP financial measures of Core FFO per share, AFFO per share, Same Store revenue growth, Same Store operating expense growth, Same Store NOI growth, and Same Store Core NOI margin to the comparable GAAP financial measures because it is unable to reasonably predict certain items contained in the GAAP measures, including non-recurring and infrequent items that are not indicative of the Company’s ongoing operations. Such items include, but are not limited to, impairment on depreciated real estate assets, net (gain)/loss on sale of previously depreciated real estate assets, share-based compensation, casualty loss, non-Same Store revenues, and non-Same Store operating expenses. These items are uncertain, depend on various factors, and could have a material impact on our GAAP results for the guidance period.

Note: Refer to “Glossary and Reconciliations” for metric definitions and reconciliations of non-GAAP financial measures.

 

Q2 2017 Earnings Release and Supplemental Information - page 27

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Glossary and Reconciliations

 

 

Glossary:

Average Estimated Invested Basis

Average estimated cost basis on acquisition represents the sum of purchase price, any closing adjustments, and estimated upfront renovation expense for an acquired home or population of homes.

Average Monthly Rent

Average monthly rent represents the average of the contracted monthly rent for occupied properties in an identified population of homes for the relevant period and reflects rent concessions amortized over the life of the related lease.

Average Occupancy

Average occupancy for an identified population of homes represents (i) the number of days that the homes available for lease in such population were occupied, divided by (ii) the total number of available days in the measurement period for the homes in that population.

Core NOI Margin

Core NOI margin for an identified population of homes is calculated by dividing NOI by total revenues, net of resident recoveries attributable to such population.

EBITDA and Adjusted EBITDA

EBITDA and Adjusted EBITDA are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. We define EBITDA as net income or loss (computed in accordance with GAAP) before the following items: interest expense; income tax expense; and depreciation and amortization. Adjusted EBITDA is defined as EBITDA before the following items: share-based compensation expense; offering related expenses, impairment and other; acquisition costs; gain (loss) on sale of property, net of tax; and interest income and other miscellaneous income and expenses. EBITDA and Adjusted EBITDA are used as supplemental financial performance measures by management and by external users of our financial statements, such as investors and commercial banks. Set forth below is additional detail on how management uses EBITDA and Adjusted EBITDA as measures of performance.

The GAAP measure most directly comparable to EBITDA and Adjusted EBITDA is net income or loss. EBITDA and Adjusted EBITDA are not used as measures of our liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our EBITDA and Adjusted EBITDA may not be comparable to the EBITDA and Adjusted EBITDA of other companies due to the fact that not all companies use the same definitions of EBITDA and Adjusted EBITDA. Accordingly, there can be no assurance that our basis for computing these non-GAAP measures is comparable with that of other companies.

See “Reconciliation of Non-GAAP Measures” below for a reconciliation of GAAP net income (loss) to EBITDA and Adjusted EBITDA.

Funds from Operations (FFO), Core Funds from Operations (Core FFO), and Adjusted Funds from Operations (AFFO)

FFO, Core FFO, and Adjusted FFO are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) as net income or loss (computed in accordance with GAAP) excluding net gains or losses from sales of previously depreciated real estate assets, plus depreciation, amortization and impairment of real estate assets, and adjustments for unconsolidated partnerships and joint ventures.

We believe that FFO is a meaningful supplemental measure of the operating performance of our business because historical cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization. Because real estate values have historically risen or fallen with market conditions, management considers FFO an appropriate supplemental performance measure as it excludes historical cost depreciation and amortization, impairment on depreciated real estate investments, as well as gains or losses related to sales of previously depreciated homes, from GAAP net income or loss.

 

Q2 2017 Earnings Release and Supplemental Information - page 28

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The GAAP measure most directly comparable to FFO is net income or loss. FFO is not used as a measure of our liquidity and should not be considered an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our FFO may not be comparable to the FFO of other companies due to the fact that not all companies use the same definition of FFO. Accordingly, there can be no assurance that our basis for computing this non-GAAP measures is comparable with that of other companies.

We believe that Core FFO and Adjusted FFO are also meaningful supplemental measures of our operating performance for the same reasons as FFO and are further helpful to investors as they provides a more consistent measurement of our performance across reporting periods by removing the impact of certain items that are not comparable from period to period. We define Core FFO as FFO adjusted for noncash interest expense related to amortization of deferred financing costs and discounts related to our financing arrangements, noncash interest expense for derivatives, share-based compensation expense, offering related expenses, severance expenses, casualty losses, net, and acquisition costs, as applicable. We define Adjusted FFO as Core FFO less recurring capital expenditures that are necessary to help preserve the value of and maintain functionality of our homes.

The GAAP measure most directly comparable to Core FFO and Adjusted FFO is net income or loss. Core FFO and Adjusted FFO are not used as measures of our liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our Core FFO and Adjusted FFO may not be comparable to the Core FFO and Adjusted FFO of other companies due to the fact that not all companies use the same definition of Core FFO and Adjusted FFO. Accordingly, there can be no assurance that our basis for computing this non-GAAP measures is comparable with that of other companies.

Please see Supplemental Schedule 1 for a reconciliation of GAAP net income (loss) to FFO, Core FFO, and Adjusted FFO.

Net Effective Rental Rate Growth

Net effective rental rate growth for any home represents the difference between the monthly rent from an expiring lease and the monthly rent from the next lease, in each case, net of any amortized concessions. Leases are either renewal leases, where our current resident chooses to stay for a subsequent lease term, or a new lease, where our previous resident moves out and a new resident signs a lease to occupy the same home. Blended net effective rental rate growth represents the blended average of net effective rental rate growth for both new and renewal leases.

Net Operating Income (NOI)

NOI is a non-GAAP measure often used to evaluate the performance of real estate companies. We define NOI for an identified population of homes as rental revenues and other property income less property operating and maintenance expense (which consists primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel expenses, repairs and maintenance, leasing costs and marketing). NOI excludes: interest expense; depreciation and amortization; general and administrative expense; property management expense; impairment and other; acquisition costs; (gain) loss on sale of property, net of tax; and interest income and other miscellaneous income and expenses.

The GAAP measure most directly comparable to NOI is net income or loss. NOI is not used as a measure of liquidity and should not be considered as an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. Our NOI may not be comparable to the NOI of other companies due to the fact that not all companies use the same definition of NOI. Accordingly, there can be no assurance that our basis for computing this non-GAAP measure is comparable with that of other companies.

We believe that Same Store NOI is also a meaningful supplemental measure of our operating performance for the same reasons as NOI and is further helpful to investors as it provides a more consistent measurement of our performance across reporting periods by reflecting NOI for homes in our Same Store portfolio.

See “Reconciliation of Non-GAAP Measures” below for a reconciliation of GAAP net income (loss) to NOI for our total portfolio and NOI for our Same Store portfolio.

 

Q2 2017 Earnings Release and Supplemental Information - page 29

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Northern California

Northern California includes Modesto, CA, Napa, CA, Oakland-Fremont-Hayward, CA, Sacramento-Arden-Arcade-Roseville, CA, San Jose-Sunnyvale-Santa Clara, CA, Stockton-Lodi, CA, Vallejo-Fairfield, CA and Yuba City, CA.

PSF

PSF means per square foot.

Same Store / Same Store Portfolio

Same Store or Same Store portfolio includes, for a given reporting period, homes that have been stabilized (defined as homes that have (i) completed an upfront renovation and (ii) entered into at least one post-renovation Invitation Homes lease) for at least 90 days prior to the first day of the prior-year measurement period and excludes homes that have been sold and homes that have been designated for sale but have not yet entered into a written sale agreement during such reporting period. Same Store portfolios are established as of January 1st of each calendar year. Therefore, any home included in the Same Store portfolio will have satisfied the conditions described in clauses (i) and (ii) above prior to October 3rd of the year prior to the first year of the comparison period. We believe presenting information about the portion of our portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of our comparable homes across periods and about trends in our organic business.

South Florida

South Florida includes Fort Lauderdale-Pompano Beach-Deerfield Beach, FL, Key West, FL, Miami-Miami Beach-Kendall, FL and West Palm Beach-Boca Raton-Delray Beach, FL.

Southern California

Southern California includes Anaheim-Santa Ana-Irvine, CA, Los Angeles-Long Beach-Glendale, CA, Oxnard-Thousand Oaks-Ventura, CA, Riverside-San Bernardino-Ontario, CA and San Diego-Carlsbad-San Marcos, CA.

Total Cost to Maintain

Total cost to maintain a home represents the sum of average maintenance and turnover expense per home (gross) and average capital expenditures per home, in each case before giving effect to any offsetting income received directly from residents or withheld out of resident security deposits.

Total Homes / Total Portfolio

Total homes or total portfolio refers to the total number of homes we own, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated.

Turnover Rate

Turnover rate represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population. To the extent the measurement period shown is less than 12 months, the turnover rate will be reflected on an annualized basis.

 

Q2 2017 Earnings Release and Supplemental Information - page 30

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Reconciliation of Non-GAAP Measures:

 

Reconciliation of Total Revenues to Same Store Total Revenues and Same Store Core Revenues

(in thousands) (unaudited)

 

		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Total revenues (total portfolio) (1)		$	242,216			$	238,750			$	234,551			$	233,038			$	230,496
Non-Same Store total revenues			(22,578	)			(22,878	)			(22,456	)			(22,028	)			(20,482	)
Total revenues (Same Store portfolio) (2)			219,638				215,872				212,095				211,010				210,014
Resident recoveries (Same Store portfolio) (3)			(3,873	)			(3,463	)			(2,520	)			(2,541	)			(2,446	)
Core revenues (Same Store portfolio)		$	215,765			$	212,409			$	209,575			$	208,469			$	207,568

 

(1)	For the total portfolio, revenues are net of bad debt expense of $898, $981, $1,329, $1,219, and $1,031 for Q2 2017, Q1 2017, Q4 2016, Q3 2016, and Q2 2016, respectively.

(2)	For the Same Store portfolio, revenues are net of bad debt expense of $816, $843, $1,156, $1,086, and $908 for Q2 2017, Q1 2017, Q4 2016, Q3 2016, and Q2 2016, respectively.

(3)	For the total portfolio, resident recoveries were $4,281, $3,851, $2,831, $2,833, and $2,679 in Q2 2017, Q1 2017, Q4 2016, Q3 2016, and Q2 2016, respectively.

Reconciliation of Total Revenues to Same Store Total Revenues and Same Store Core Revenues

(in thousands) (unaudited)

 

		YTD 2017				YTD 2016
Total revenues (total portfolio) (1)		$	480,966			$	454,998
Non-Same Store total revenues			(45,456	)			(38,886	)
Total revenues (Same Store portfolio) (2)			435,510				416,112
Resident recoveries (Same Store portfolio)			(7,336	)			(4,877	)
Core revenues (Same Store portfolio) (3)		$	428,174			$	411,235

 

(1)	For the total portfolio, revenues are net of bad debt expense of $1,879 and $2,302 for YTD 2017 and YTD 2016, respectively.

(2)	For the Same Store portfolio, revenues are net of bad debt expense of $1,659 and $2,123 for YTD 2017 and YTD 2016, respectively.

(3)	For the total portfolio, resident recoveries were $8,132 and $5,300 in YTD 2017 and YTD 2016, respectively.

 

Q2 2017 Earnings Release and Supplemental Information - page 31

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Reconciliation of Property Operating and Maintenance to Same Store Operating Expenses and Same Store Core Operating Expenses

(in thousands) (unaudited)

 

		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Property operating and maintenance expenses (total portfolio)		$	92,840			$	88,168			$	89,833			$	94,246			$	91,281
Non-Same Store operating expenses			(8,855	)			(9,029	)			(9,840	)			(9,118	)			(8,841	)
Operating expenses (Same Store portfolio)			83,985				79,139				79,993				85,128				82,440
Resident recoveries (Same Store portfolio)			(3,873	)			(3,463	)			(2,520	)			(2,541	)			(2,446	)
Core operating expenses (Same Store portfolio)		$	80,112			$	75,676			$	77,473			$	82,587			$	79,994

Reconciliation of Property Operating and Maintenance to Same Store Operating Expenses and Same Store Core Operating Expenses

(in thousands) (unaudited)

 

		YTD 2017				YTD 2016
Property operating and maintenance expenses (total portfolio)		$	181,008			$	176,248
Non-Same Store operating expenses			(17,884	)			(16,937	)
Operating expenses (Same Store portfolio)			163,124				159,311
Resident recoveries (Same Store portfolio)			(7,336	)			(4,877	)
Core operating expenses (Same Store portfolio)		$	155,788			$	154,434

 

Q2 2017 Earnings Release and Supplemental Information - page 32

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Reconciliation of Net Income (Loss) to NOI, Same Store NOI, and Same Store Core NOI Margin

(in thousands) (unaudited)

 

		Q2 2017				Q1 2017				Q4 2016				Q3 2016				Q2 2016
Net income (loss) available to common shareholders		$	5,420			$	(42,391	)		$	(26,649	)		$	(21,949	)		$	(19,666	)
Net income (loss) available to participating securities			109				—				—				—				—
Interest expense			57,358				68,572				76,883				68,365				70,523
Depreciation and amortization			67,515				67,577				69,420				66,480				66,079
General and administrative			18,426				58,266				19,523				18,811				15,408
Property management expense			9,135				11,449				7,855				7,715				7,530
Impairment and other			706				1,204				2,565				1,279				546
Acquisition costs			—				—				8				—				7
Gain on sale of property, net of tax			(10,162	)			(14,321	)			(5,412	)			(2,966	)			(1,020	)
Other			869				226				525				1,057				(192	)
NOI (total portfolio)			149,376				150,582				144,718				138,792				139,215
Non-Same Store NOI			(13,723	)			(13,849	)			(12,616	)			(12,910	)			(11,641	)
NOI (Same Store portfolio)		$	135,653			$	136,733			$	132,102			$	125,882			$	127,574
Core revenues (Same Store portfolio)		$	215,765			$	212,409			$	209,575			$	208,469			$	207,568
Core NOI margin (Same Store portfolio)			62.9	%			64.4	%			63.0	%			60.4	%			61.5	%

Reconciliation of Net Income (Loss) to NOI, Same Store NOI, and Same Store Core NOI Margin

(in thousands) (unaudited)

 

		YTD 2017				YTD 2016
Net income (loss) available to common shareholders		$	(36,971	)		$	(29,641	)
Net income (loss) available to participating securities			109				—
Interest expense			125,930				140,800
Depreciation and amortization			135,092				131,781
General and administrative			76,692				30,768
Property management expense			20,584				14,923
Impairment and other			1,910				363
Acquisition costs			—				42
Gain on sale of property, net of tax			(24,483	)			(10,212	)
Other			1,095				(74	)
NOI (total portfolio)			299,958				278,750
Non-Same Store NOI			(27,572	)			(21,949	)
NOI (Same Store portfolio)		$	272,386			$	256,801
Core revenues (Same Store portfolio)		$	428,174			$	411,235
Core NOI margin (Same Store portfolio)			63.6	%			62.4	%

 

Q2 2017 Earnings Release and Supplemental Information - page 33

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Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA

(in thousands) (unaudited)

 

		Q2 2017				Q2 2016				% Change				YTD 2017				YTD 2016				% Change
Net income (loss) available to common shareholders		$	5,420			$	(19,666	)						$	(36,971	)		$	(29,641	)
Net income (loss) available to participating securities			109				—								109				—
Interest expense			57,358				70,523								125,930				140,800
Depreciation and amortization			67,515				66,079								135,092				131,781
EBITDA			130,402				116,936								224,160				242,940
Share-based compensation expense			8,216				4,106								52,460				8,312
Offering related expenses			656				—								8,287				—
Impairment and other			706				546								1,910				363
Acquisition costs			—				7								—				42
Gain on sale of property, net of tax			(10,162	)			(1,020	)							(24,483	)			(10,212	)
Other			869				(192	)							1,095				(74	)
Adjusted EBITDA		$	130,687			$	120,383				8.6	%		$	263,429			$	241,371				9.1	%

Reconciliation of Net Debt / Annualized Adjusted EBITDA

(in thousands, except for ratio) (unaudited)

 

		As of June 30, 2017
Mortgage loans, net		$	4,158,666
Term loan facility, net			1,486,529
Total Debt per Balance Sheet			5,645,195
Retained and repurchased certificates			(234,052	)
Cash, ex-security deposits (1)			(208,327	)
Deferred financing costs			32,321
Unamortized discount on note payable			3,521
Net Debt (A)		$	5,238,658
		For the Three Months Ended June 30, 2017
Adjusted EBITDA (B)		$	130,687
Annualized Adjusted EBITDA (C = B x 4)		$	522,748
Net debt / annualized Adjusted EBITDA (A / C)			10.0x

 

(1)	Represents cash and cash equivalents and the non-security deposit portion of restricted cash.

 

Q2 2017 Earnings Release and Supplemental Information - page 34

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Reconciliation of Fixed Charge Coverage Ratio

(in thousands, except for ratio) (unaudited)

		For the Three Months Ended June 30, 2017
Interest expense		$	57,358
Noncash interest expense			(5,137	)
Fixed charges (A)		$	52,221
Adjusted EBITDA (B)		$	130,687
Fixed charge coverage ratio (B / A)			2.5x

 

Q2 2017 Earnings Release and Supplemental Information - page 35