Camden Property Trust

08/01/2025 | Press release | Distributed by Public on 08/01/2025 10:06

Quarterly Report for Quarter Ending 6/30/25 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the condensed consolidated financial statements and notes appearing elsewhere in this report, as well as Part I, Item 1A, "Risk Factors" within our Annual Report on Form 10-K for the year ended December 31, 2024. Historical results and trends which might appear in the condensed consolidated financial statements should not be interpreted as being indicative of future operations.
We consider portions of this report to be "forward-looking" within the meaning of Section 27A of the Securities Act of 1933 (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), both as amended, with respect to our expectations for future periods. Forward-looking statements do not discuss historical facts, but instead include statements related to expectations, projections, intentions, or other items relating to the future; forward-looking statements are not guarantees of future performance, results, or events. Although we believe the expectations reflected in our forward-looking statements are based upon reasonable assumptions, we can give no assurance our expectations will be achieved. Any statements contained herein which are not statements of historical fact should be deemed forward-looking statements. Reliance should not be placed on these forward-looking statements as these statements are subject to known and unknown risks, uncertainties, and other factors beyond our control and could differ materially from our actual results and performance.
Factors which may cause our actual results or performance to differ materially from those contemplated by forward-looking statements include, but are not limited to, the following:
•Volatility in capital and credit markets, or other unfavorable changes in economic conditions, either nationally or regionally in one or more of the markets in which we operate, could adversely impact us;
•Short-term leases could expose us to the effects of declining market rents;
•We could be negatively impacted by the risks associated with land holdings and related activities;
•Development, repositions, redevelopment, and construction risks could impact our profitability;
•Our acquisition strategy may not produce the cash flows expected;
•Changes in rent control or rent stabilization laws and regulations could adversely affect our operations and property values;
•Failure to qualify as a REIT could have adverse consequences;
•Tax laws could continue to change at any time and any such legislative or other actions could have a negative effect on us;
•A cybersecurity incident and other technology disruptions could negatively impact our business;
•We have significant debt, which could have adverse consequences;
•Insufficient cash flows could limit our ability to make required payments for debt obligations or pay distributions to shareholders;
•Issuances of additional debt may adversely impact our financial condition;
•We may be unable to renew, repay, or refinance our outstanding debt;
•Rising interest rates could increase our borrowing costs, lower the value of our real estate, and decrease our share price, leading investors to seek higher yields through other investments;
•Failure to maintain our current credit ratings could adversely affect our cost of funds, related margins, liquidity, and access to capital markets;
•Share ownership limits and our ability to issue additional equity securities may prevent takeovers beneficial to shareholders;
•The form, timing, and amount of dividend distributions in future periods may vary and be impacted by economic and other considerations;
•Litigation risks could affect our business;
•Damage from catastrophic weather and other natural events could result in losses;
•Competition could adversely affect our ability to acquire properties; and
•We could be adversely impacted due to our share price fluctuations.
These forward-looking statements represent our estimates and assumptions as of the date of this report, and we assume no obligation to update or supplement forward-looking statements because of subsequent events.
Executive Summary
Camden Property Trust and all consolidated subsidiaries are primarily engaged in the ownership, management, development, reposition, redevelopment, acquisition, and construction of multifamily apartment communities. We focus on investing in markets characterized by high-growth economic conditions, strong employment, and attractive quality of life which we believe leads to higher demand for our apartments and retention of our residents. As of June 30, 2025, we owned interests
in, operated, or were developing 180 multifamily properties comprised of 61,203 apartment homes across the United States. In addition, we own other land holdings which we may develop into multifamily apartment communities in the future.
Business Environment and Current Outlook
Our results for the three and six months ended June 30, 2025, reflect an increase in same store revenues of approximately 1.0% and 0.9%, respectively, as compared to the same periods in 2024. The increases were primarily due to higher occupancy, which we believe was primarily attributable to job growth, favorable demographics with a higher propensity to rent versus buy, and continued demand for multifamily housing in our markets.
We believe the levels of new multifamily supply in the submarkets and asset classes in which we operate are manageable and these moderating levels of supply should be met with continued demand to absorb these new deliveries. However, if this were to change or other economic conditions were to worsen, our operating results could be adversely affected.
Consolidated Results
Net income attributable to common shareholders was $80.7 million and $42.9 million for the three months ended June 30, 2025 and 2024, respectively, and was $119.5 million and $126.8 million for the six months ended June 30, 2025 and 2024, respectively. The $37.8 million increase during the three months ended June 30, 2025, as compared to the same period in 2024, was primarily due to recognizing a gain on sale of one operating property in June 2025 of $47.3 million. The $7.3 million decrease during the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to higher depreciation expense and amortization of in-place leases relating to the acquisition of three operating properties incurred during the six months ended June 30, 2025, partially offset by recognizing a higher gain on the sale of an operating property during the six months ended June 30, 2025 as compared to the gain on sale recognized during the same period in 2024. See further discussion of our 2025 operations as compared to 2024 in "Results of Operations," below.
Construction and Development Activity
At June 30, 2025, we had a total of four properties under construction comprising 1,531 apartment homes. As of June 30, 2025, we estimated the total additional cost to complete the construction of these four properties was approximately $312.2 million.
Acquisitions
During the six months ended June 30, 2025, we purchased the following operating properties:
($ in millions)
Property Location Purchase Price Homes Month Purchased
Camden Clearwater Clearwater, Florida $138.7
360
May 2025
Camden West Nashville Nashville, Tennessee
$131.3
435
February 2025
Camden Leander Leander, Texas
$67.7
352
January 2025
Dispositions
During the six months ended June 30, 2025, we sold the following operating property:
($ in millions)
Property Location Sales Price Gain Recognized Homes Month Sold
Camden Midtown Houston, Texas $60.0 $47.3 337 June 2025
Subsequent to quarter end, we sold the following operating properties:
($ in millions)
Property Location Sales Price Homes Month Sold
Camden Royal Oaks I & II Houston, Texas $60.0 340 July 2025
Camden Cimarron Irving, Texas $53.5
286
July 2025
Debt
In February 2025, we established a commercial paper program under which we may issue the commercial paper notes (the "Notes") under the exemption from registration contained in Section (4)(a) of the Securities Act. Amounts available under the commercial paper program may be borrowed, repaid, and reborrowed from time to time, with the aggregate face or principal amount of the Notes outstanding under the Program at any time not to exceed $600.0 million. At June 30, 2025, we had an aggregate of $515.6 million principal amount of Notes outstanding under the commercial paper program which had a weighted average interest rate of 4.55%.
Future Outlook
Subject to market conditions, we intend to continue to seek opportunities to acquire operating communities, develop new communities, and to redevelop and reposition existing communities. We also intend to evaluate our portfolio and plan to continue our practice of selective dispositions as market conditions warrant and opportunities arise. We expect to maintain a strong balance sheet and preserve our financial flexibility by continuing to focus on our core fundamentals which we believe are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. We intend to meet our near-term liquidity requirements through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured revolving credit facility and through our commercial paper program, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our 2023 at-the-market ("ATM") program, and other unsecured borrowings or secured mortgages.
As of June 30, 2025, we had approximately $1.2 billion available under our $1.2 billion unsecured revolving credit facility. We currently plan to use our unsecured revolving credit facility as a liquidity backstop for borrowings under the commercial paper program. At June 30, 2025, we had $515.6 million outstanding under our commercial paper program. We believe scheduled repayments of debt are manageable with contractual debt maturities over the next 12 months totaling $527.5 million, of which $515.6 million relates to commercial paper notes. As of June 30, 2025, and through the date of this filing, we also had common shares having an aggregate offering amount of up to $500.0 million remaining available for sale under our 2023 ATM program. We believe we are well-positioned with a strong balance sheet and sufficient liquidity to fund future acquisitions, new development, repositions, redevelopment, and other capital requirements including scheduled debt maturities. We will, however, continue to assess and take further actions we believe are prudent to meet our objectives and capital requirements.
Property Portfolio
Our multifamily property portfolio is summarized as follows:
June 30, 2025 December 31, 2024
Number of
Homes 		Properties Number of
Homes 		Properties
Operating Properties
Houston, Texas 9,194 27 9,531 28
Dallas/Fort Worth, Texas 6,226 15 6,224 15
Washington, D.C. Metro 6,194 17 6,192 17
Phoenix, Arizona 4,426 14 4,426 14
Atlanta, Georgia 4,270 14 4,270 14
Austin, Texas 4,038 12 3,686 11
Orlando, Florida 3,954 11 3,954 11
Raleigh, North Carolina 3,672 10 3,672 10
Charlotte, North Carolina 3,510 15 3,510 15
Tampa/St. Petersburg, Florida 3,464 9 3,104 8
Southeast Florida 3,050 9 3,050 9
Denver, Colorado 2,873 9 2,873 9
Los Angeles/Orange County, California 1,811 5 1,811 5
San Diego/Inland Empire, California 1,797 6 1,797 6
Nashville, Tennessee 1,193 3 758 2
Total Operating Properties 59,672 176 58,858 174
Properties Under Construction
Charlotte, North Carolina 769 2 769 2
Nashville, Tennessee 393 1 - -
Raleigh, North Carolina 369 1 369 1
Total Properties Under Construction 1,531 4 1,138 3
Total Properties 61,203 180 59,996 177
Stabilized
We generally consider a property stabilized once it reaches 90% occupancy. During the second quarter of 2024, we completed the construction of Camden Woodmill Creek in Spring, Texas, which has 189 homes, and stabilization was achieved during the second quarter of 2025.
Completed Construction in Lease- Up
At June 30, 2025, there were two completed operating properties in lease up as follows:
($ in millions)
Properties and Locations
Number of
Homes
Cost
Incurred (1)
% Leased at 7/28/2025 Date of
Construction
Completion 		Estimated
Date of
Stabilization
Camden Durham
Durham, NC 420 $145.4 95% 4Q24 3Q25
Camden Long Meadow Farms
Richmond, TX 188 $72.5 75% 4Q24 1Q26
(1) Excludes leasing costs, which are expensed as incurred.
Properties Under Development and Land
Our condensed consolidated balance sheet at June 30, 2025 includes approximately $380.4 million related to properties under development and land. Of this amount, approximately $229.9 million related to our projects currently under construction. In addition, we had approximately $150.5 million primarily invested in land held for future development and land holdings, which included approximately $92.7 million related to land held for future development and $57.8 million invested in land which we may develop in the future.
Properties Under Construction. At June 30, 2025, we had four properties in various stages of construction as follows:
($ in millions)
Properties and Locations
Number of
Homes 		Estimated
Cost 		Cost
Incurred 		Included in
Properties
Under
Development 		Estimated
Date of
Construction
Completion 		Estimated
Date of
Stabilization
Camden Village District (1)
Raleigh, NC 369 $ 138.0 $ 136.8 $ 39.9 3Q25 2Q27
Camden South Charlotte
Charlotte, NC 420 163.0 81.1 81.1 2Q27 4Q28
Camden Blakeney
Charlotte, NC 349 154.0 55.4 55.4 3Q27 3Q28
Camden Nations
Nashville, TN 393 184.0 53.5 53.5 3Q28 2Q30
Total 1,531 $ 639.0 $ 326.8 $ 229.9
(1) Property in lease-up was 37% leased at July 28, 2025.
Development Pipeline Communities. At June 30, 2025, we had the following multifamily communities undergoing development activities:
($ in millions)
Properties and Locations
Projected Homes
Total Estimated Cost (1)
Cost to Date
Camden Baker
Denver, CO 434 $ 191.0 $ 38.5
Camden Gulch
Nashville, TN 498 300.0 54.2
Total 932 $ 491.0 $ 92.7
(1)Represents our estimate of total costs we expect to incur on these projects. However, forward-looking estimates are not guarantees of future performance, results, or events. Although we believe these expectations are based upon reasonable assumptions, future events rarely develop exactly as forecast, and estimates routinely require adjustment.
Land Holdings. At June 30, 2025, we also had four undeveloped land tracts with a valuation of approximately $57.8 million.
Results of Operations
Changes in revenues and expenses related to our operating properties from period-to-period are due primarily to the performance of stabilized properties in the portfolio, the lease-up of newly-constructed properties, and the impact of acquisitions and dispositions.
Management considers property net operating income ("NOI") to be an appropriate supplemental measure of operating performance to net income because it reflects the operating performance of our communities without an allocation of corporate level property management overhead or general and administrative costs. We define NOI as total property revenue less total property expenses. NOI is further detailed in the Property-Level NOI table as seen below. NOI is not defined by accounting principles generally accepted in the United States of America ("GAAP") and should not be considered an alternative to net income as an indication of our operating performance. Additionally, NOI as disclosed by other REITs may not be comparable to our calculation.
Reconciliations of net income to NOI for the three and six months ended June 30, 2025 and 2024 are as follows:
Three Months Ended
June 30, 		Six Months Ended
June 30,
(in thousands) 2025 2024 2025 2024
Net income $ 82,594 $ 44,810 $ 123,361 $ 130,569
Less: Fee and asset management income (2,633) (2,606) (5,120) (3,890)
Less: Interest and other income (68) (1,598) (78) (3,366)
Less: Income on deferred compensation plans (8,350) (1,073) (9,548) (6,892)
Plus: Property management expense 9,699 9,846 19,594 19,240
Plus: Fee and asset management expense 641 475 1,312 918
Plus: General and administrative expense 21,183 18,154 39,891 34,847
Plus: Interest expense 35,375 32,227 69,165 64,764
Plus: Depreciation and amortization expense 152,108 145,894 301,360 290,696
Plus: Expense on deferred compensation plans 8,350 1,073 9,548 6,892
Plus: Loss on early retirement of debt - - - 921
Less: Gain on sale of operating property (47,293) - (47,293) (43,806)
Plus: Income tax expense 1,231 1,059 1,790 1,964
Net operating income $ 252,837 $ 248,261 $ 503,982 $ 492,857
Property-Level NOI (1)
Property NOI, as reconciled above, is detailed further into the following categories for the three and six months ended June 30, 2025 as compared to the same periods in 2024:
($ in thousands) Homes at Three Months Ended
June 30, 		Change Six Months Ended
June 30, 		Change
6/30/2025 2025 2024 $ % 2025 2024 $ %
Property revenues:
Same store communities 56,781 $ 377,408 $ 373,685 $ 3,723 1.0 % $ 751,979 $ 745,341 $ 6,638 0.9 %
Non-same store communities
2,283 11,896 5,591 6,305 * 20,715 10,765 9,950 92.4
Development and lease-up communities
2,139 3,127 903 2,224 * 5,867 1,299 4,568 *
Dispositions/Other - 4,078 6,971 (2,893) (41.5) 8,513 12,886 (4,373) (33.9)
Total property revenues
61,203 $ 396,509 $ 387,150 $ 9,359 2.4 % $ 787,074 $ 770,291 $ 16,783 2.2 %
Property expenses:
Same store communities 56,781 $ 136,408 $ 133,254 $ 3,154 2.4 % $ 268,565 $ 264,659 $ 3,906 1.5 %
Non-same store communities
2,283 4,775 2,526 2,249 89.0 8,214 5,235 2,979 56.9
Development and lease-up communities
2,139 1,516 549 967 * 2,864 812 2,052 *
Dispositions/Other - 973 2,560 (1,587) (62.0) 3,449 6,728 (3,279) (48.7)
Total property expenses
61,203 $ 143,672 $ 138,889 $ 4,783 3.4 % $ 283,092 $ 277,434 $ 5,658 2.0 %
Property NOI:
Same store communities 56,781 $ 241,000 $ 240,431 $ 569 0.2 % $ 483,414 $ 480,682 $ 2,732 0.6 %
Non-same store communities
2,283 7,121 3,065 4,056 * 12,501 5,530 6,971 *
Development and lease-up communities
2,139 1,611 354 1,257 * 3,003 487 2,516 *
Dispositions/Other - 3,105 4,411 (1,306) (29.6) 5,064 6,158 (1,094) (17.8)
Total property NOI
61,203 $ 252,837 $ 248,261 $ 4,576 1.8 % $ 503,982 $ 492,857 $ 11,125 2.3 %
* Not a meaningful percentage.
(1) For 2025, same store communities are communities we wholly-owned and were stabilized since January 1, 2024, excluding communities under redevelopment and properties held for sale. Non-same store communities are stabilized communities not owned or stabilized since January 1, 2024, including communities under redevelopment and excluding properties held for sale. We define communities under redevelopment as communities with capital expenditures which improve a community's cash flow and competitive position through extensive unit, exterior building, common area, and amenity upgrades. Management believes same store information is beneficial as it allows both management and investors the ability to determine financial results over a particular period for the same set of communities. Development and lease-up communities are non-stabilized communities we have developed since January 1, 2024, excluding properties held for sale. Dispositions/Other includes those communities disposed of or held for sale which are not classified as discontinued operations, non-multifamily rental properties, expenses related to land holdings not under active development, and other miscellaneous revenues and expenses, including net below-market leases, casualty-related expenses net of recoveries, and severance related costs.
Same Store Analysis
Same store property NOI increased approximately $0.6 million and $2.7 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024.
The $0.6 million increase in same store property NOI for the three months ended June 30, 2025 was primarily due to an increase in same store property revenues of approximately $3.7 million which was partially offset by an increase of approximately $3.2 million in same store property expenses as compared to the same period in 2024.
The $3.7 million increase in same store property revenues during the three months ended June 30, 2025, as compared to the same period in 2024, was primarily due to higher occupancy of approximately $1.5 million, higher income of approximately $1.2 million from our utility rebilling and ancillary income programs, and lower uncollectible revenues of approximately $0.5 million.
The $3.2 million increase in same store property expenses during the three months ended June 30, 2025, as compared to the same period in 2024, was primarily due to higher utilities expense of approximately $1.3 million, higher salaries and benefits of approximately $1.2 million, higher general and administrative and marketing and leasing expenses of approximately $0.8 million, and higher repairs and maintenance expense of approximately $0.6 million. The increase was partially offset by lower property insurance expense of approximately $1.0 million.
The $2.7 million increase in same store property NOI for the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to an increase in same store property revenues of approximately $6.6 million which was
partially offset by an increase of approximately $3.9 million in same store property expenses as compared to the same period in 2024.
The $6.6 million increase in same store property revenues during the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to higher occupancy of approximately $3.3 million, higher income of approximately $2.2 million from our utility rebilling and ancillary income programs, and lower uncollectible revenues of approximately $1.0 million.
The $3.9 million increase in same store property expenses during the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to higher utilities expense of approximately $2.5 million, higher salaries and benefits of approximately $2.2 million, and higher general and administrative and marketing and leasing expenses of approximately $1.0 million. The increase was partially offset by lower property insurance expense of approximately $1.9 million.
Non-same Store and Development and Lease-up Analysis
Property NOI from non-same store and development and lease-up communities increased approximately $5.3 million and $9.5 million for the three and six months ended June 30, 2025 as compared to the same periods in 2024. The increases were due to increases from non-same store communities of approximately $4.1 million and $7.0 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024, and increases from development and lease-up communities of $1.2 million and $2.5 million for the three and six months ended June 30, 2025, as compared to the same periods in 2024. The increases in property NOI from our non-same store communities was primarily due to the acquisition of three operating properties during the three and six months ended June 30, 2025 and the stabilization of one operating property in 2024, and one operating property in 2025. The increases in property NOI from our development and lease-up communities were primarily due to the timing of lease-up for two operating properties which completed construction in 2024.
The following table details the changes, described above, relating to non-same store and development and lease up NOI:
(in millions) For the three months ended June 30, 2025 as compared to 2024 For the six months ended June 30, 2025 as compared to 2024
Property Revenues:
Revenues from acquisitions $ 5.1 $ 7.0
Revenues from non-same store stabilized properties 1.0 2.3
Revenues from development and lease-up properties 2.2 4.6
Other non same-store 0.2 0.6
$ 8.5 $ 14.5
Property Expenses:
Expenses from acquisitions $ 2.0 $ 2.8
Expenses from non-same store stabilized properties 0.2 0.3
Expenses from development and lease-up properties 1.0 2.1
Other non same-store - (0.2)
$ 3.2 $ 5.0
Property NOI:
NOI from acquisitions $ 3.1 $ 4.2
NOI from non-same store stabilized properties 0.8 2.0
NOI from development and lease-up properties 1.2 2.5
Other non same-store 0.2 0.8
$ 5.3 $ 9.5
Dispositions/Other Property Analysis
Dispositions/Other property NOI decreased approximately $1.3 million and $1.1 million for the three and six months ended June 30, 2025, as compared to the same periods in 2024. The decreases were comprised of lower NOI related to dispositions of approximately $0.3 million and $0.8 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024 due to the disposition of one operating property in June 2025. The decrease during the six months ended June 30, 2025 also related to the disposition of one operating property in February 2024. The decreases were also due to lower other property NOI of approximately $1.0 million and $0.3 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The decreases were primarily due to recognizing higher
business interruption insurance proceeds during the three and six months ended June 30, 2024, and incurring lower storm-related expenses during the three and six months ended June 30, 2025 as compared to the same periods in 2024.
Non-Property Income
($ in thousands) Three Months Ended
June 30, 		Change Six Months Ended
June 30, 		Change
2025 2024 $ % 2025 2024 $ %
Fee and asset management $ 2,633 $ 2,606 $ 27 1.0% $ 5,120 $ 3,890 $ 1,230 31.6%
Interest and other income 68 1,598 (1,530) (95.7) 78 3,366 (3,288) (97.7)
Income on deferred compensation plans 8,350 1,073 7,277 * 9,548 6,892 2,656 38.5
Total non-property income $ 11,051 $ 5,277 $ 5,774 109.4 % $ 14,746 $ 14,148 $ 598 4.2 %
* Not a meaningful percentage.
Fee and asset management income from construction and development activities at our third-party construction projects was relatively flat during the three months ended June 30, 2025 and increased approximately $1.2 million for the six months ended June 30, 2025, as compared to the same periods in 2024. The increase for the six months ended June 30, 2025 was related to higher fees earned on third-party construction projects due to higher activity as compared to the same period in 2024.
Interest and other income decreased approximately $1.5 million and $3.3 million for the three and six months ended June 30, 2025, as compared to the same periods in 2024. The decreases were primarily due to lower investment interest income earned due to having lower average cash balances during the three and six months ended June 30, 2025 as compared to the same periods in 2024.
Our deferred compensation plans recognized income of approximately $8.4 million and $9.5 million during the three and six months ended June 30, 2025, respectively, as compared to income of approximately $1.1 million and $6.9 million during the three and six months ended June 30, 2024, respectively. The changes were related to the performance of the investments held in deferred compensation plans for participants and were directly offset by the expense related to these plans, as discussed below.
Other Expenses
($ in thousands) Three Months Ended
June 30, 		Change Six Months Ended
June 30, 		Change
2025 2024 $ % 2025 2024 $ %
Property management $ 9,699 $ 9,846 $ (147) (1.5) % $ 19,594 $ 19,240 $ 354 1.8 %
Fee and asset management 641 475 166 34.9 1,312 918 394 42.9
General and administrative 21,183 18,154 3,029 16.7 39,891 34,847 5,044 14.5
Interest 35,375 32,227 3,148 9.8 69,165 64,764 4,401 6.8
Depreciation and amortization 152,108 145,894 6,214 4.3 301,360 290,696 10,664 3.7
Expense on deferred compensation plans 8,350 1,073 7,277 * 9,548 6,892 2,656 38.5
Total other expenses $ 227,356 $ 207,669 $ 19,687 9.5 % $ 440,870 $ 417,357 $ 23,513 5.6 %
* Not a meaningful percentage.
Property management expense represents regional supervision and accounting costs related to property operations. Property management expenses were approximately 2.4% and 2.5% of total property revenues for the three months ended June 30, 2025 and 2024, respectively, and were 2.5% of total property revenues for each of the six months ended June 30, 2025 and 2024.
Fee and asset management expense from construction and development activities at our third-party projects increased approximately $0.2 million and $0.4 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The increases were primarily due to increases in third-party construction activity as compared to the same periods in 2024.
General and administrative expense increased approximately $3.0 million and $5.0 million during the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The increases were primarily related to higher legal expenses and higher acquisition pursuit costs. Excluding income on deferred compensation plans, general and administrative expenses were approximately 5.3% and 4.6% of total revenues for the three months ended June 30, 2025 and 2024, respectively, and were 5.0% and 4.5% of total revenues for the six months ended June 30, 2025 and 2024, respectively.
Interest expense increased approximately $3.1 million and $4.4 million for the three and six months ended June 30, 2025, as compared to the same periods in 2024. The increases were primarily due to increases in interest expense relating to interest recognized on our commercial paper program entered into in February 2025, and decreases in capitalized interest expense due
to having lower average balances in assets under construction during the three and six months ended June 30, 2025 as compared to the same periods in 2024. The increases were offset by the repayment of a $250 million, 3.68% senior unsecured notes payable in September 2024, and lower variable rate interest expense recognized on the $500 million senior unsecured notes during the three and six months ended June 30, 2025 as compared to the same periods in 2024. The increase in interest expense during the six months ended June 30, 2025 was also due to an increase in interest expense recognized on our unsecured revolving credit facility resulting from higher average balances outstanding during the six months ended June 30, 2025 as compared to the same period in 2024.
Depreciation and amortization expense increased approximately $6.2 million and $10.7 million for the three and six months ended June 30, 2025, respectively, as compared to the same periods in 2024. The increases were primarily due to higher depreciation expense and amortization of in-place leases related to the acquisition of an operating property in each of January, February, and May 2025.
Our deferred compensation plans incurred an expense of approximately $8.4 million and $9.5 million for the three and six months ended June 30, 2025, respectively, as compared to recognizing an expense of approximately $1.1 million and $6.9 million during the three and six months ended June 30, 2024, respectively. The changes were related to the performance of the investments held in deferred compensation plans for participants and were directly offset by the income related to these plans, as discussed in the non-property income section above.
Other
Three Months Ended
June 30, 		Change Six Months Ended
June 30, 		Change
($ in thousands) 2025 2024 $ 2025 2024 $
Loss on early retirement of debt $ - $ - $ - $ - $ (921) $ 921
Gain on sale of operating property $ 47,293 $ - $ 47,293 $ 47,293 $ 43,806 $ 3,487
Income tax expense $ (1,231) $ (1,059) $ (172) $ (1,790) $ (1,964) $ 174
The $0.9 million loss on early retirement of debt for the six months ended June 30, 2024 was due to the write-off of unamortized loan costs related to the early retirement of our $300 million unsecured term loan in January 2024, which was scheduled to mature in August 2024.
The $47.3 million gain on sale during the three and six months ended June 30, 2025 was due to the disposition of one operating property located in Houston, Texas in June 2025. The $43.8 million gain on sale for the six months ended June 30, 2024 was due to the disposition of one operating property located in Atlanta, Georgia in February 2024.
Funds from Operations ("FFO"), Core FFO, and Core Adjusted FFO ("Core AFFO")
Management considers FFO, Core FFO, and Core AFFO to be appropriate supplementary measures of the financial performance of an equity REIT. The National Association of Real Estate Investment Trusts ("NAREIT") currently defines FFO as net income (computed in accordance with GAAP), excluding depreciation and amortization related to real estate, gains and losses from the sale of certain real estate assets, gains and losses from change in control, impairment write-downs of certain real estate assets and investments in entities when the impairment is directly attributable to decreases in the value of depreciable real estate held by the entity, and adjustments for unconsolidated joint ventures to reflect FFO on the same basis. Our calculation of diluted FFO also assumes conversion of all potentially dilutive securities, including certain non-controlling interests, which are convertible into common shares. We consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains and losses on dispositions of real estate, impairment write-downs of certain real estate assets, and depreciation, FFO can assist in the comparison of the operating performance of a company's real estate investments between periods or to different companies.
Core FFO represents FFO as further adjusted for items not considered part of our core business operations. We consider Core FFO to be a helpful supplemental measure of operating performance as it also excludes certain items which, by nature, are not comparable period over period and therefore tends to obscure actual operating performance. Our definition of Core FFO may differ from other REITs, and there can be no assurance our basis for computing this measure is comparable to other REITs.
Core AFFO is calculated utilizing Core FFO less recurring capitalized expenditures which are necessary to help preserve the value of and maintain the functionality at our communities. We also consider Core AFFO to be a useful supplemental measure because it is frequently used by analysts and investors to evaluate a REIT's operating performance between periods or to different companies. Our definition of recurring capital expenditures may differ from other REITs, and there can be no assurance our basis for computing this measure is comparable to other REITs.
To facilitate a clear understanding of our consolidated historical operating results, we believe FFO, Core FFO, and Core AFFO should be examined in conjunction with net income attributable to common shareholders as presented in the condensed
consolidated statements of income and comprehensive income and data included elsewhere in this report. FFO, Core FFO, and Core AFFO are not defined by GAAP and should not be considered alternatives to net income attributable to common shareholders as an indication of our operating performance. Additionally, FFO, Core FFO, and Core AFFO as disclosed by other REITs may not be comparable to our calculation.
Reconciliations of net income attributable to common shareholders to FFO, Core FFO, and Core AFFO for the three and six months ended June 30, 2025 and 2024 are as follows:
Three Months Ended
June 30, 		Six Months Ended
June 30,
($ in thousands) 2025 2024 2025 2024
Funds from operations
Net income attributable to common shareholders $ 80,670 $ 42,917 $ 119,492 $ 126,806
Real estate depreciation and amortization 148,886 142,895 295,054 284,742
Gain on sale of operating property (47,293) - (47,293) (43,806)
Income allocated to non-controlling interests 1,924 1,893 3,869 3,763
Funds from operations $ 184,187 $ 187,705 $ 371,122 $ 371,505
Casualty-related expenses, net of recoveries (1,099) (1,587) (969) (64)
Legal costs and settlements 2,311 1,114 4,183 1,966
Expensed transaction, development, and other pursuit costs 2,082 660 2,963 660
Severance - - - 506
Loss on early retirement of debt - - - 921
Other miscellaneous items 76 - 76 -
Core funds from operations $ 187,557 $ 187,892 $ 377,375 $ 375,494
Less: recurring capitalized expenditures (29,968) (29,595) (46,066) (51,620)
Core adjusted funds from operations $ 157,589 $ 158,297 $ 331,309 $ 323,874
Weighted average shares - basic 108,636 108,406 108,584 108,556
Incremental shares issuable from assumed conversion of:
Share awards granted 39 18 52 21
Common units 1,594 1,594 1,594 1,594
Weighted average shares - diluted 110,269 110,018 110,230 110,171
Liquidity and Capital Resources
Financial Condition and Sources of Liquidity
We intend to maintain a strong balance sheet and preserve our financial flexibility, which we believe should enhance our ability to identify and capitalize on investment opportunities as they become available. We intend to maintain what management believes is a conservative capital structure by:
•extending and sequencing the maturity dates of our debt where practicable;
•managing interest rate exposure using what management believes to be prudent levels of fixed and floating rate debt;
•maintaining what management believes to be conservative coverage ratios; and
•using what management believes to be a prudent combination of debt and equity.
Our interest expense coverage ratio, net of capitalized interest, was approximately 6.4 and 7.0 for the three months ended June 30, 2025 and 2024, respectively, and 6.6 and 6.9 for the six months ended June 30, 2025 and 2024, respectively. This ratio is a method for calculating the amount of operating cash flows available to cover interest expense and is calculated by dividing interest expense for the period into the sum of property revenues and expenses, non-property income, and other expenses, after adding back depreciation, amortization, and interest expense. Approximately 90.2% and 89.9% of our properties were unencumbered at June 30, 2025 and 2024, respectively. Our weighted average maturity of debt was approximately 5.1 years at June 30, 2025.
Our primary source of liquidity is cash flows generated from operations. Other sources may include one or more of the following: availability under our unsecured revolving credit facility and our commercial paper program, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our 2023 ATM program, and other unsecured borrowings or secured mortgages. We believe our liquidity and financial condition are sufficient to meet all of our reasonably anticipated cash needs during the next twelve months from our filing date including:
•normal recurring operating expenses;
•current debt service requirements including scheduled debt maturities;
•recurring and non-recurring capital expenditures;
•funding of property developments, repositions, redevelopments, and acquisitions; and
•the minimum dividend payments required to maintain our REIT qualification under the Code.
Factors which could increase or decrease our future liquidity include but are not limited to volatility in capital and credit markets, changes in rent control or rent stabilization laws, sources of financing, the minimum REIT dividend requirements, our ability to complete asset purchases, sales, or developments, the effect our debt level and changes in credit ratings could have on our cost of funds, and our ability to access capital markets.
Cash Flows
The following is a discussion of our cash flows for the six months ended June 30, 2025 as compared to the same period in 2024.
Net cash from operating activities was approximately $378.9 million during the six months ended June 30, 2025 as compared to approximately $361.0 million for the same period in 2024. The increase was primarily due to the timing of real estate tax payments in 2025 as compared to the same period in 2024, the growth attributable to our same store and non-same store communities, including the acquisition of three operating properties during 2025, and the timing of three operating properties which completed construction in 2024. The increase was partially offset by higher interest payments on our debt. See further discussion of our 2025 operations as compared to 2024 in "Results of Operations."
Net cash used in investing activities during the six months ended June 30, 2025 totaled approximately $473.5 million as compared to net cash provided by investing activities of $100.5 million during the same period in 2024. Cash outflows during the six months ended June 30, 2025 primarily related to the acquisition of three operating properties for approximately $334.2 million, and amounts paid for property development and capital improvements of approximately $195.2 million. These outflows were partially offset by net proceeds from the sale of one operating property of approximately $58.8 million. Cash outflows during the six months ended June 30, 2024 primarily related to amounts paid for property development and capital improvements of approximately $210.5 million. These outflows were partially offset by net proceeds from the sale of one operating property of approximately $114.5 million. The decrease in property development and capital improvements for the six months ended June 30, 2025, as compared to the same period in 2024, was primarily due to lower capital improvements,
reposition expenditures, and indirect costs in 2025 as compared to 2024. The property development and capital improvements during the six months ended June 30, 2025 and 2024, included the following:
Six Months Ended
June 30,
(in millions) 2025 2024
Expenditures for new development, including land $ 92.1 $ 92.2
Capital expenditures 48.4 54.4
Reposition expenditures 41.7 47.0
Direct real estate taxes and capitalized interest and other indirect costs 13.0 16.9
Total $ 195.2 $ 210.5
Net cash provided by financing activities totaled approximately $106.9 million for the six months ended June 30, 2025 as compared to net cash used in financing activities of approximately $426.6 million during the same period in 2024. Cash inflows during the six months ended June 30, 2025 primarily related to net proceeds of approximately $514.8 million of borrowings from our commercial paper program. These inflows were partially offset by net payments of $178.0 million of borrowings from our unsecured revolving credit facility, and $229.5 million used for distributions to common shareholders and non-controlling interest holders. Cash outflows during the six months ended June 30, 2024 primarily related to the repayment of our $300 million unsecured term loan, and $250 million senior unsecured notes in January 2024. Cash outflows also related to $223.9 million used for distributions to common shareholders and non-controlling interest holders, and $50.0 million used for common share repurchases. These outflows were partially offset by net proceeds of approximately $396.0 million from the issuance of $400.0 million senior unsecured notes in January 2024.
Financial Flexibility
We have a $1.2 billion unsecured revolving credit facility which matures in August 2026, with two options to extend the facility at our election for two consecutive six-month periods and to expand the facility up to three times by up to an additional $500 million upon satisfaction of certain conditions. The interest rate on our unsecured revolving credit facility is based upon, at our option, (a) the daily or the one-, three-, or six-month Secured Overnight Financing Rate ("SOFR") plus, in each case, a spread based on our credit rating, or (b) a base rate equal to the higher of: (i) the Federal Funds Rate plus 0.50%, (ii) Bank of America, N.A.'s prime rate, (iii) Term SOFR plus 1.0%, and (iv) 1.0%. Advances under our unsecured revolving credit facility may be priced at the scheduled rates, or we may enter into bid rate loans with participating banks at rates below the scheduled rates. These bid rate loans have terms of 180 days or less and may not exceed the lesser of $600 million or the remaining amount available under our unsecured revolving credit facility. Our unsecured revolving credit facility is subject to customary financial covenants and limitations. We believe we are in compliance with all such financial covenants and limitations as of June 30, 2025 and through the date of this filing.
Our unsecured revolving credit facility provides us with the ability to issue up to $50 million in letters of credit. While our issuance of letters of credit does not increase our borrowings outstanding under our unsecured revolving credit facility, it does reduce the amount available. At June 30, 2025, we had no outstanding letters of credit issued under our unsecured revolving credit facility and had approximately $1.2 billion available under our unsecured revolving credit facility.
In February 2025, we established a commercial paper program under which we may issue short-term, unsecured Notes under the exemption from registration contained in Section (4)(a) of the Securities Act. Amounts available under the commercial paper program may be borrowed, repaid, and reborrowed from time to time, with the aggregate face or principal amount of the Notes outstanding under the commercial paper program at any time not to exceed $600 million. The Notes will have maturities of up to 397 days from the date of issue. The Notes will rank at least equal in priority to all of the Company's other unsecured and unsubordinated indebtedness. The net proceeds of the issuances of the Notes are expected to be used for general corporate purposes, which may include property acquisitions and development in the ordinary course of business, capital expenditures, and working capital. We currently plan to use our unsecured revolving credit facility as a liquidity backstop for borrowings under the commercial paper program. At June 30, 2025, we had $515.6 million outstanding under our commercial paper program.
In May 2023, we created the 2023 ATM share offering program through which we can, but have no obligation to, sell common shares and we may also enter into separate forward sale agreements with forward purchasers for an aggregate offering amount of up to $500.0 million, in amounts and at times as we determine, into the existing trading market at current market prices as well as through negotiated transactions. Actual sales from time to time may depend on a variety of factors including, among others, market conditions, the trading price of our common shares, and determinations by management of the appropriate sources of funding for us. We intend to use proceeds from the sale of our common shares under the 2023 ATM
program for general corporate purposes, which may include reducing future borrowings under our unsecured revolving credit facility, the repayment of other indebtedness, the redemption or other repurchase of outstanding debt or equity securities, funding for development activities, and financing for acquisitions. As of the date of this filing, we have not sold any shares or entered into any forward sales agreement and have common shares having an aggregate offering amount of up to $500.0 million remaining available for sale under the 2023 ATM program.
We believe our ability to access capital markets is enhanced by our senior unsecured debt ratings by Moody's, Fitch, and Standard and Poor's, which are currently A3 with stable outlook, A- with stable outlook, and A- with stable outlook, respectively. We believe our ability to access capital markets is also enhanced by our ability to borrow on a secured basis from various institutions including banks, Fannie Mae, Freddie Mac, or life insurance companies. However, we may not be able to maintain our current credit ratings or borrow on an unsecured or secured basis in the future.
Future Cash Requirements and Contractual Obligations
One of our principal long-term liquidity requirements includes the repayment of maturing debt, including any future borrowings under our unsecured revolving credit facility. We believe scheduled repayments of debt are manageable with contractual debt maturities over the next 12 months totaling $527.5 million, of which $515.6 million relates to commercial paper notes. See Note 6. "Notes Payable,"in the notes to Condensed Consolidated Financial Statements for a further discussion of our scheduled maturities.
As of June 30, 2025, we estimated the additional cost to complete the construction of four properties to be approximately $312.2 million. Of this amount, we expect to incur costs between approximately $89 million and $99 million during the remainder of 2025 and to incur the remaining costs during 2026 through 2028. Additionally, for the remainder of 2025, we expect to incur costs between approximately $36 million and $56 million related to the start of new development activities, between approximately $52 million and $56 million of reposition, redevelopment, repurpose, and revenue enhancing expenditures, and between approximately $67 million and $71 million of additional recurring capital expenditures.
We anticipate meeting our near-term liquidity requirements through a combination of one or more of the following: cash flows generated from operations, draws on our unsecured revolving credit facility and through our commercial paper program, the use of debt and equity offerings under our automatic shelf registration statement, proceeds from property dispositions, equity issued from our ATM program, and other unsecured borrowings or secured mortgages. We continue to evaluate our portfolio and plan to continue our practice of selective dispositions as market conditions warrant and opportunities arise.
As a REIT, we are subject to a number of organizational and operational requirements, including a requirement to distribute current dividends to our shareholders equal to a minimum of 90% of our annual taxable income. In order to minimize paying income taxes, our general policy is to distribute at least 100% of our taxable income. In June 2025, our Board of Trust Managers declared a quarterly dividend of $1.05 per common share to our common shareholders of record as of June 30, 2025. The quarterly dividend was subsequently paid on July 17, 2025, and we paid equivalent amounts per unit to holders of the common operating partnership units. Assuming similar quarterly dividend distributions for the remainder of 2025, our annualized dividend rate would be $4.20 per share or unit.
Critical Accounting Policies
Our critical accounting policies have not changed from the information reported in our Annual Report on Form 10-K for the year ended December 31, 2024.
Camden Property Trust published this content on August 01, 2025, and is solely responsible for the information contained herein. Distributed via SEC EDGAR on August 01, 2025 at 16:07 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]