UMH Properties Reports Strong Growth in First Quarter Update

UMH Properties Sees Promising Growth in Q1 2025

UMH Properties, Inc. (NYSE: UMH), a leading real estate investment trust (REIT) focused on manufactured home communities, recently shared an optimistic operational update for the first quarter of 2025. This highlights their performance and strategic initiatives aimed at expanding their footprint in the market.

Key Operational Highlights

During the first quarter, UMH successfully converted 115 new homes from their inventory into revenue-generating rental homes, achieving an impressive occupancy rate of 94.7% across approximately 10,400 rental homes. This move indicates their effective management and commitment to maximizing residential opportunities for their clients.

Occupancy and Sales Performance

In terms of occupancy, UMH's Same Property metrics reflected a growth of 113 units during the quarter and an impressive increase of 227 units compared to the previous year, now standing at 88%. This uptick showcases their robust demand within the community.

Revenue Insights

The revenue from gross home sales hit $6.7 million, a slight decline from $7.4 million last year, primarily influenced by a unique scenario where a previous year included a notable liquidation of inventory. Excluding these specific sales, UMH reported a slight uptick of 0.5% in gross sales, emphasizing their resilience in fluctuating markets.

Rental Revenue Growth

UMH has experienced notable gains in rental revenue thanks to occupancy increases and rent adjustments initiated in 2024 into early 2025. The rental and related charges for the first quarter surged to approximately $54.9 million, a rise of about 8.3% over last year's numbers. This is a positive indicator of the company's financial health and management's proactive strategies.

Strategic Stock Issuance and Acquisitions

In another strategic move, the company issued and sold around 515,000 shares of Common Stock through its At-the-Market sale program, raising gross proceeds of $9.4 million at an average price of $18.21 per share. Furthermore, through its Preferred At-the-Market sale program, an additional approximately $1.1 million was raised from issuing 49,000 shares at an average price of $23.03 each.

Recent Acquisition Highlights

UMH also announced the acquisition of two age-restricted manufactured home communities in New Jersey for a total of $24.6 million. These communities, featuring 266 developed homesites, have reached full occupancy and sit on about 38 acres, aligning well with UMH’s long-term expansion strategy.

Future Outlook and Revenue Projections

Samuel A. Landy, the President and CEO of UMH Properties, expressed great enthusiasm about the company's start to 2025. With ongoing efforts in securing new homes within their communities and sales programs, he noted an increase in rental home occupancy by 70 basis points, from 94.0% to 94.7%. These trends suggest a sustained growth trajectory as warmer seasons typically boost demand.

Furthermore, plans include a continual revenue increase stemming from a 5% annual rent adjustment and the introduction of 800 new rental homes, highlighting the company’s ambitious vision for the future. As they continue their investment in community expansion and development, the potential for increased sales profits appears promising.

Dividend Strategy and Shareholder Commitment

UMH's commitment to enhancing shareholder returns is evident as they declare an increased annual dividend of $0.90 per share. This marks the fifth consecutive year of dividend increases, a testament to their strengthening financial results. Assuming mid-point guidance, the payout ratio is projected at an improving 90%, showcasing a sustainable approach toward long-term shareholder value.

Upcoming Acquisition Plans

The company stays poised to further its growth through strategic acquisitions, having two more communities in Maryland slated for a second-quarter closure. This proactive approach towards market expansion underscores UMH's ability to thrive within a competitive environment.

Frequently Asked Questions

What is UMH Properties, Inc. known for?

UMH Properties, Inc. specializes in the ownership and operation of manufactured home communities, providing quality housing options.

What was the occupancy rate for UMH this quarter?

The occupancy rate for UMH stood at 94.7% as of the first quarter of 2025.

How did rental revenue perform in the first quarter?

Rental and related charges reached approximately $54.9 million, reflecting an increase of 8.3% from the previous year.

What recent acquisitions has UMH made?

UMH acquired two age-restricted manufactured home communities in New Jersey for a total of $24.6 million, which are now fully occupied.

What is UMH's approach to dividends?

UMH has increased their annual dividend for five consecutive years, currently set at $0.90 per share, showing a commitment to returning value to shareholders.

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