Investments in Real Estate

12 Months Ended

Dec. 31, 2023

As of December 31, 2023, our investments in real estate consisted of 116 (unaudited) operating apartment properties that contain 34,431 (unaudited) units and one (unaudited) development property that contains 325 (unaudited) units. The following table summarizes our investments in real estate:


	2023		2022		Depreciable Lives (In years)
Land	$	540,950	$	579,094	—
Building	5,288,956		5,695,711		40
Furniture, fixtures and equipment	429,306		340,438		5-10
Total investments in real estate	$	6,259,212	$	6,615,243
Accumulated depreciation	(582,760)		(425,034)
Investments in real estate, net	$	5,676,452	$	6,190,209

Portfolio Optimization and Deleveraging Strategy

On October 26, 2023, our Board of Directors approved a plan, which we refer to as our Portfolio Optimization and Deleveraging Strategy, which targeted the sale of 10 properties located in seven markets in order to exit or reduce our presence in these markets while also deleveraging our balance sheet. As of December 31, 2023, four of these targeted properties in four markets were sold.

As of December 31, 2023, the six remaining properties targeted for sale under our Portfolio Optimization and Deleveraging Strategy were classified as held for sale. We sold two of these six assets subsequent to December 31, 2023, and as of the date of this Annual Report, the remaining four assets are under executed contracts of sale and are expected to close in the first quarter of 2024. We expect to use the net proceeds from the sale of these properties to reduce our indebtedness and recognized a loss on impairment on five of the six properties that had carrying values that exceeded the expected sales proceeds less transactions costs. While the four remaining properties that are part of the Portfolio Optimization and Deleveraging Strategy are under contracts of sale, there can be no assurance that the sales will be consummated at expected pricing levels, within expected time frames, or at all.

For the year ended December 31, 2023, we recorded impairment charges that are included in (loss on impairment) gain on sale of real estate assets, net on the consolidated statements of operations as detailed in the following table.


Property Name	Market	Units (Unaudited)	Sale Date	Sale Price		(Loss on Impairment) Gain on Sale(1)
Eagle Lake Landing	Indianapolis, IN	277	2/28/2023	$	37,300	$	1,179
The Meadows at River Run (2)	Chicago, IL	374	12/20/2023	72,700		(14,612)
Fielders Creek (2)	Denver, CO	217	12/21/2023	44,100		(11,019)
Cottage Trails at Culpepper Landing (2)	Norfolk, VA	183	12/28/2023	40,750		(10,168)
Oak Crossing (2)	Fort Wayne, IN	222	12/28/2023	43,100		1,029
Belmar Villas (2)(3)	Denver, CO	318	2/13/2024	74,300		(7,195)
Villas at Kingwood (2)(3)	Houston, TX	330	2/13/2024	53,700		(4,634)
Villas at Huffmeister (2)(3)	Houston, TX	294	(5)	44,250		(4,097)
Hearthstone at City Center (2)(3)	Denver, CO	360	(5)	74,000		(9,895)
Reserve at Creekside (2)(3)	Chattanooga, TN	192	(5)	28,500		(7,135)
Westmont Commons (2)(3)(4)	Asheville, NC	252	(5)	49,875		—
Totals		3,019		$	562,575	$	(66,547)

(1)(Loss on impairment) gain on sale of real estate sold in 2023 is net of $1,900 of defeasance and debt prepayment gains.

(2)Included in the Portfolio Optimization and Deleveraging Strategy.

(3)Held for sale as of December 31, 2023.

(4)A gain on sale of real estate is expected as a result of the sales proceeds less transactions costs exceeding the carrying value.

(5)We expect the sale of these properties to close in the first quarter of 2024.

Acquisitions

There were no property acquisitions during the year ended December 31, 2023.

The below table summarizes asset acquisitions for the year ended December 31, 2022:


Property Name	Date of Purchase	Market	Units (unaudited)	Purchase Price
Views of Music City (phase I)	04/06/2022	Nashville, TN	96	$	25,440
Cyan Mallard Creek	08/16/2022	Charlotte, NC	234	80,000
The Enclave at Tranquility Lake	09/13/2022	Tampa, FL	348	98,000
Total			678	$	203,440

On April 6, 2022, we acquired Views of Music City (phase I), a 96-unit property (unaudited) located in Nashville, TN for $25,440. Views of Music City (phase I) was acquired from one of our unconsolidated joint ventures. On account of our equity interest in this joint venture, we received $4,428 of the sales proceeds, comprised of $3,406 as a return of capital and $1,022 as a preferred return on capital. In accordance with ASC 970-323-30-7, we recorded the preferred return on capital as a reduction to the carrying value of the purchased real estate, deferring the gain which will be recognized as income on a pro rata basis as the real estate is depreciated or when it is sold to a third party.

The below table summarizes asset acquisitions for the year ended December 31, 2021:


Property Name	Date of Purchase	Market	Units (unaudited)	Purchase Price
Vesta City Park	05/18/2021	Charlotte, NC	272	$	66,544
Cyan Craig Ranch	06/08/2021	Dallas, TX	322	73,372
Total			594	$	139,916

As discussed in Note 3: IRT And STAR Merger, we acquired 68 properties (unaudited) comprised of 21,394 units (unaudited) that were accounted for as a business combination.

Dispositions

The table above under Portfolio Optimization and Deleveraging Strategy, summarizes the dispositions and properties held for sale for the year ended December 31, 2023 and the properties sold subsequent to the year ended December 31, 2023.

The below table summarizes the dispositions for the year ended December 31, 2022:


Property Name	Date of Sale	Sale Price		Gain on sale (loss on impairment) (1)
Riverchase	01/18/2022	$	31,000	$	12,901
Heritage Park	02/02/2022	48,500		31,366
Raindance	02/02/2022	47,500		33,748
Haverford	02/02/2022	31,050		16,697
Meadows Apartments	10/26/2022	57,000		20,573
Sycamore Terrace (2)	12/06/2022	42,000		(3,529)
Total		$	257,050	$	111,756


			(1)			The gain on sale (loss on impairment) for these properties is net of $409 of defeasance and debt prepayment gains.
			(2)			Impairment charge recognized following a fourth quarter amendment to the purchase and sale agreement which resulted in the carrying value of the property exceeding its fair value.

The below table summarizes the dispositions for the year ended December 31, 2021:


Property Name	Date of Sale	Sale Price		Gain on sale (1)
King's Landing	07/28/2021	$	40,100	$	11,566
Crestmont	12/13/2021	48,500		33,067
Creekside	12/16/2021	91,000		43,104
Total		$	179,600	$	87,737


			(1)			The gain on sale for these properties is net of $2,312 of defeasance costs and debt prepayment costs.