Exhibit 99.1

Earnings Release

Centerspace Reports Strong Second Quarter 2021 Financial Results; Improved Financial Outlook

MINNEAPOLIS, MN, August 2, 2021 – Centerspace (NYSE: CSR) announced today its financial and operating results for the three and six months ended June 30, 2021. The tables below show Net Income, Funds from Operations (“FFO”)1, and Core FFO1, all on a per share basis, for the three and six months ended June 30, 2021; Same-Store Revenues, Expenses, and Net Operating Income (“NOI”)1 over comparable periods; and Same-Store Weighted-Average Occupancy for each of the three months ended June 30, 2021, March 31, 2021, and June 30, 2020.

						Three Months Ended June 30,												Six Months Ended June 30,
Per Share						2021						2020						2021						2020
Net Income - diluted						$	1.48					$	(0.44)					$	1.02					$	(1.13)
FFO - diluted						$	0.95					$	0.93					$	1.87					$	1.58
Core FFO - diluted						$	0.98					$	0.91					$	1.93					$	1.81

						Year-Over-Year Comparison						Sequential Comparison						YTD Comparison
Same-Store Results						Q2 2021 vs. Q2 2020						Q2 2021 vs. Q1 2021						2021 vs. 2020
Revenues						3.2		%				1.3		%				1.9		%
Expenses						6.2		%				0.9		%				2.1		%
NOI						1.2		%				1.6		%				1.7		%

						Three months ended
Same-Store Results						June 30, 2021						March 31, 2021						June 30, 2020
Weighted Average Occupancy						94.9		%				94.9		%				94.5		%

(1)NOI, FFO, Core FFO, and same-store results are non-GAAP financial measures. For more information on their usage and presentation, and a reconciliation to the most directly comparable GAAP measures, refer to “Non-GAAP Financial Measures and Reconciliations” below.

Highlights

•Net Income was $1.48 per diluted share for the second quarter of 2021, compared to Net Loss of $(0.44) per diluted share for the same period of 2020;

•Core FFO increased 7.7% to $0.98 per diluted share for the three months ended June 30, 2021, compared to $0.91 for the three months ended June 30, 2020 and 6.6% to $1.93 per diluted share for the six months ended June 30, 2021, compared to $1.81 for the six months ended June 30, 2020;

•Same-store revenues increased by 3.2% for the second quarter of 2021 compared to the second quarter of 2020;

•Same-store new lease over lease rates were 10.0% for the second quarter of 2021, compared to a decline of (1.2)% in the same period of the prior year. Same-store renewal lease over lease rates were 5.6% for the second quarter of 2021, compared to 3.2% for the same period the prior year;

•Increased the mid-point of the earnings per share outlook by 123% and the mid-point of Core FFO by 7%;

•Entered into Contribution Agreements with entities managed by KMS Management, Inc. ("KMS"), to acquire a portfolio of 17 communities funded through the issuance of up to $197.3 million Convertible Preferred Operating Partnerships Units and approximately $126.5 million in mortgage liabilities; and

•Continued to strengthen the balance sheet by issuing 731,000 common shares under the 2019 ATM program for net proceeds of $54.6 million.

1

Acquisitions and Dispositions

During the quarter, Centerspace entered into Contribution Agreements with entities managed by KMS. Upon closing, Centerspace will acquire a portfolio of 17 communities. Centerspace will fully fund the transaction through the issuance of up to $197.3 million, which will be paid in the form of Convertible Preferred Operating Partnership units that pay a 3.875% dividend and are convertible, at the holder's option, into common units at an exchange rate of 1.2048 common units per Convertible Preferred Operating Units representing a conversion price of $83.00 per unit. The KMS partners will have the ability to receive up to an aggregate of $16.2 million in cash in lieu of Convertible Preferred Operating Partnership Units. The Company will acquire real property assets subject to approximately $126.5 million in liabilities, a portion of which the company intends to refinance upon consummation of the transactions. The transaction is expected to close during the third quarter.

During the quarter, Centerspace disposed of 589 apartment homes in Rochester, Minnesota for an aggregate sale price of $60.0 million.

Balance Sheet

At the end of the second quarter, Centerspace had $168.2 million of total liquidity on its balance sheet, consisting of $163.0 million available under the line of credit and cash and cash equivalents of $5.2 million.

Improved 2021 Financial Outlook

Centerspace revised its 2021 financial outlook, which includes the anticipated acquisition of KMS during the third quarter. For additional information, see S-16 of the Supplemental Financial and Operating Data for the quarter ended June 30, 2021 included at the end of this release. These ranges should be considered in their entirety. The revised outlook is:

			Previous Outlook for 2021						Updated Outlook for 2021
			Low			High			Low			High
Earnings per Share – diluted			$	0.10		$	0.50		$	0.58		$	0.76
Same-Store Revenue			0.0		%	3.0		%	2.0		%	3.5		%
Same-Store Expenses			3.0		%	5.0		%	4.0		%	6.0		%
Same-Store NOI			(1.5)		%	1.5		%	0.5		%	2.0		%
FFO per Share – diluted			$	3.38		$	3.62		$	3.64		$	3.83
Core FFO per Share – diluted			$	3.48		$	3.72		$	3.78		$	3.94

COVID-19 Developments

The COVID-19 pandemic, including the associated economic disruptions, has continued to impact business and operations since March 2020. The company continues to prioritize the health and well-being of its residents, team members, and the communities it serves.

A discussion of the ongoing and potential effects of the COVID-19 pandemic on financial condition, results of operations, and cash flows can be found in "Management's Discussion and Analysis of Financial Conditions and Results of Operations" presented in the company's Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 22, 2021. For a more detailed description of the risks and uncertainties affecting business, see the risk factors presented in Item 1A in the company's Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 22, 2021.

Upcoming Events

Centerspace is scheduled to participate in the BMO 2021 Real Estate Conference, which will be held in New York City on September 14, 2021.

Centerspace is scheduled to participate in the Bank of America 2021 Global Real Estate Conference, which will be held virtually on September 21-23, 2021.

2

Earnings Call

Live webcast and replay:  https://ir.centerspacehomes.com

Live Conference Call

Conference Call Replay

Tuesday, August 3, 2021, at 10:00 AM ET

Replay available until August 17, 2021

USA Toll Free Number

1-877-509-9785

USA Toll Free Number

1-877-344-7529

International Toll Free Number

1-412-902-4132

International Toll Free Number

1-412-317-0088

Canada Toll Free Number

1-855-669-9657

Canada Toll Free Number

1-855-669-9658

Conference Number

10157697

Supplemental Information

Supplemental Operating and Financial Data for the quarter ended June 30, 2021 included herein (“Supplemental Information”), is available in the Investors section on Centerspace’s website at www.centerspacehomes.com or by calling Investor Relations at 701-837-7104. Non-GAAP financial measures and other capitalized terms, as used in this earnings release, are defined and reconciled in the Supplemental Financial and Operating Data, which accompanies this earnings release.  

About Centerspace

Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of June 30, 2021, Centerspace owned 62 apartment communities consisting of 11,579 apartment homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, and South Dakota. Centerspace was named a Top Workplace for 2021 by the Minneapolis Star Tribune. For more information, please visit www.centerspacehomes.com.

Forward-Looking Statements

Certain statements in this press release and the accompanying Supplemental Operating and Financial Data are based on the company's current expectations and assumptions, and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from the results of operations, financial conditions, or plans expressed or implied by the forward-looking statements. Although the company believes the expectations reflected in its forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be achieved. Such risks, uncertainties, and other factors that might cause such differences include, but are not limited to those risks and uncertainties detailed from time to time in Centerspace's filings with the Securities and Exchange Commission, including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” contained in its Annual Report on Form 10-K for the year ended December 31, 2020, in its subsequent quarterly reports on Form 10-Q, and in other public reports. The company assumes no obligation to update or supplement forward-looking statements that become untrue due to subsequent events.

Contact Information

Investor Relations

Emily Miller

Phone: 701-837-7104

IR@centerspacehomes.com

Marketing & Media

Kelly Weber

Phone: 701-837-7104

kweber@centerspacehomes.com

3

Supplemental Financial and Operating Data

Table of Contents

June 30, 2021

			Page
Common Share Data			S-1
Key Financial Data
Condensed Consolidated Statements of Operations			S-2
Condensed Consolidated Balance Sheets			S-3
Non-GAAP Financial Measures and Reconciliations
Net Operating Income			S-4
Same-Store Controllable Expenses			S-5
Funds From Operations			S-6
Adjusted EBITDA			S-8
Debt and Capital Analysis
Debt Analysis			S-9
Capital Analysis			S-10
Portfolio Analysis
Same-Store Comparison			S-11
Portfolio Summary			S-14
Capital Expenditures			S-15
2021 Financial Outlook			S-16

Common Share Data (NYSE: CSR)

						2nd Quarter						1st Quarter						4th Quarter						3rd Quarter						2nd Quarter
						2021						2021						2020						2020						2020
High closing price						$	79.71					$	73.42					$	74.55					$	73.53					$	76.82
Low closing price						$	67.28					$	68.00					$	65.79					$	61.87					$	44.36
Average closing price						$	71.99					$	71.37					$	70.30					$	70.15					$	63.91
Closing price at end of quarter						$	78.90					$	68.00					$	70.64					$	65.17					$	70.49
Common share distributions – annualized						$	2.80					$	2.80					$	2.80					$	2.80					$	2.80
Closing dividend yield – annualized						3.6		%				4.1		%				4.0		%				4.3		%				4.0		%
Closing common shares outstanding (thousands)						14,045						13,220						13,027						12,976						12,827
Closing limited partnership units outstanding (thousands)						881						950						977						1,018						1,022
Closing market value of outstanding common shares, plus imputed closing market value of outstanding limited partnership units (thousands)						$	1,177,661					$	963,560					$	989,243					$	911,989					$	976,216

S-1

CENTERSPACE

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands)

						Three Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020
REVENUE						$	46,656					$	46,648					$	45,540					$	44,138					$	43,910
EXPENSES
Property operating expenses, excluding real estate taxes						13,018						13,449						12,668						13,129						12,360
Real estate taxes						5,742						5,792						5,256						5,402						5,410
Property management expense						2,085						1,767						1,460						1,442						1,345
Casualty (gain) loss						(27)						101						331						91						913
Depreciation/amortization						19,308						19,992						20,282						18,995						18,156
General and administrative expenses						3,797						3,906						3,733						3,077						3,202
TOTAL EXPENSES						$	43,923					$	45,007					$	43,730					$	42,136					$	41,386
Operating income						2,733						1,641						1,810						2,002						2,524
Interest expense						(7,089)						(7,231)						(6,903)						(6,771)						(6,940)
Interest and other income (loss)						619						431						404						277						521
Income (loss) before gain (loss) on sale of real estate and other investments, and gain (loss) on litigation settlement						(3,737)						(5,159)						(4,689)						(4,492)						(3,895)
Gain (loss) on sale of real estate and other investments						26,840						—						17						25,676						(190)
Net income (loss)						$	23,103					$	(5,159)					$	(4,672)					$	21,184					$	(4,085)
Dividends to preferred unitholders						(160)						(160)						(160)						(160)						(160)
Net (income) loss attributable to noncontrolling interest – Operating Partnership						(1,386)						469						460						(1,387)						447
Net (income) loss attributable to noncontrolling interests – consolidated real estate entities						(19)						(17)						(6)						(8)						(5)
Net income (loss) attributable to controlling interests						21,538						(4,867)						(4,378)						19,629						(3,803)
Dividends to preferred shareholders						(1,607)						(1,607)						(1,607)						(1,607)						(1,609)
Discount (premium) on redemption of preferred shares						—						—						—						(1)						25
NET INCOME (LOSS) AVAILABLE TO COMMON SHAREHOLDERS						$	19,931					$	(6,474)					$	(5,985)					$	18,021					$	(5,387)
Per Share Data - Basic
Net earnings (loss) per common share – basic						$	1.49					$	(0.49)					$	(0.46)					$	1.40					$	(0.44)
Per Share Data - Diluted
Net earnings (loss) per common share – diluted						$	1.48					$	(0.49)					$	(0.46)					$	1.38					$	(0.44)

S-2

CENTERSPACE

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

(in thousands)

						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020
ASSETS
Real estate investments
Property owned						$	1,838,837					$	1,883,407					$	1,812,557					$	1,805,390					$	1,694,033
Less accumulated depreciation						(407,400)						(408,014)						(399,249)						(380,392)						(383,917)
						1,431,437						1,475,393						1,413,308						1,424,998						1,310,116
Mortgage loans receivable						37,457						30,107						24,661						17,986						10,961
Total real estate investments						1,468,894						1,505,500						1,437,969						1,442,984						1,321,077
Cash and cash equivalents						5,194						10,816						392						16,804						52,714
Restricted cash						8,444						1,610						6,918						2,199						2,535
Other assets						17,218						18,427						18,904						16,947						16,484
TOTAL ASSETS						$	1,499,750					$	1,536,353					$	1,464,183					$	1,478,934					$	1,392,810
LIABILITIES, MEZZANINE EQUITY, AND EQUITY
LIABILITIES
Accounts payable and accrued expenses						$	52,413					$	53,852					$	55,609					$	58,596					$	54,883
Revolving line of credit						87,000						181,544						152,871						135,000						63,000
Notes payable, net of loan costs						319,286						319,236						269,246						269,202						269,155
Mortgages payable, net of loan costs						287,143						293,709						297,074						313,065						323,705
TOTAL LIABILITIES						$	745,842					$	848,341					$	774,800					$	775,863					$	710,743
SERIES D PREFERRED UNITS						$	18,022					$	16,560					$	16,560					$	16,560					$	16,560
EQUITY
Series C Preferred Shares of Beneficial Interest						93,530						93,530						93,530						93,530						93,579
Common Shares of Beneficial Interest						1,033,940						980,453						968,263						968,436						958,292
Accumulated distributions in excess of net income						(433,310)						(443,409)						(427,681)						(412,577)						(421,515)
Accumulated other comprehensive income (loss)						(12,064)						(12,798)						(15,905)						(17,256)						(18,139)
Total shareholders’ equity						$	682,096					$	617,776					$	618,207					$	632,133					$	612,217
Noncontrolling interests – Operating Partnership						53,133						53,007						53,930						53,669						52,558
Noncontrolling interests – consolidated real estate entities						657						669						686						709						732
Total equity						$	735,886					$	671,452					$	672,823					$	686,511					$	665,507
TOTAL LIABILITIES, MEZZANINE EQUITY, AND EQUITY						$	1,499,750					$	1,536,353					$	1,464,183					$	1,478,934					$	1,392,810

S-3

CENTERSPACE

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (unaudited)

This release contains certain non-GAAP financial measures. The non-GAAP financial measures should not be considered a substitute for operating results determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The definitions and calculations of these non-GAAP financial measures, as calculated by us, may not be comparable to non-GAAP financial measures reported by other REITs that do not define each of the non-GAAP financial measures exactly as Centerspace does.

The company provides certain information on a same-store and non-same-store basis. Same-store apartment communities are owned or in service for substantially all of the periods being compared, and, in the case of newly-constructed properties, have achieved a target level of physical occupancy of 90%. On the first day of each calendar year, Centerspace determines the composition of its same-store pool for that year as well as adjusts the previous year, which allows us to evaluate full period-over-period operating comparisons for existing apartment communities and their contribution to net income. The company believes that measuring performance on a same-store basis is useful to investors because it enables evaluation of how a fixed pool of its communities are performing year-over-year. Centerspace uses this measure to assess whether or not the company has been successful in increasing NOI, renewing the leases on existing residents, controlling operating costs, and making prudent capital improvements.

Reconciliation of Operating Income to Net Operating Income

Net operating income, or NOI, is a non-GAAP financial measure which the company defines as total real estate revenues less property operating expenses, including real estate taxes. Centerspace believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by depreciation, amortization, financing, property management overhead, casualty losses, and general and administrative expenses. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common shareholders, or cash flow from operating activities as a measure of financial performance.

			(in thousands, except percentages)
			Three Months Ended																					Sequential												Year-Over-Year
			6/30/2021						3/31/2021						6/30/2020									$ Change						% Change						$ Change						% Change
Operating income			$	2,733					$	1,641					$	2,524								$	1,092					66.5		%				$	209					8.3		%
Adjustments:
Property management expenses			2,085						1,767						1,345									318						18.0		%				740						55.0		%
Casualty (gain) loss			(27)						101						913									(128)						(126.7)		%				(940)						(103.0)		%
Depreciation and amortization			19,308						19,992						18,156									(684)						(3.4)		%				1,152						6.3		%
General and administrative expenses			3,797						3,906						3,202									(109)						(2.8)		%				595						18.6		%
Net operating income			$	27,896					$	27,407					$	26,140								$	489					1.8		%				$	1,756					6.7		%
Revenue
Same-store			$	40,521					$	40,000					$	39,282								$	521					1.3		%				$	1,239					3.2		%
Non-same-store			4,436						4,241						931									195						4.6		%				3,505						376.5		%
Other properties			646						650						402									(4)						(0.6)		%				244						60.7		%
Dispositions			1,053						1,757						3,295									(704)						(40.1)		%				(2,242)						(68.0)		%
Total			46,656						46,648						43,910									8						—						2,746						6.3		%
Property operating expenses, including real estate taxes
Same-store			16,528						16,378						15,567									150						0.9		%				961						6.2		%
Non-same-store			1,439						1,496						385									(57)						(3.8)		%				1,054						273.8		%
Other properties			268						289						252									(21)						(7.3)		%				16						6.3		%
Dispositions			525						1,078						1,566									(553)						(51.3)		%				(1,041)						(66.5)		%
Total			18,760						19,241						17,770									(481)						(2.5)		%				990						5.6		%
Net operating income
Same-store			23,993						23,622						23,715									371						1.6		%				278						1.2		%
Non-same-store			2,997						2,745						546									252						9.2		%				2,451						448.9		%
Other properties			378						361						150									17						4.7		%				228						152.0		%
Dispositions			528						679						1,729									(151)						(100.0)		%				(1,201)						(69.5)		%
Total			$	27,896					$	27,407					$	26,140								$	489					1.8		%				$	1,756					6.7		%

S-4

			(in thousands, except percentages)
			Six Months Ended June 30,
			2021						2020						$ Change						% Change
Operating income			$	4,374					$	4,528					$	(154)					(3.4)		%
Adjustments:
Property management expenses			3,852						2,899						953						32.9		%
Casualty (gain) loss			74						1,240						(1,166)						(94.0)		%
Depreciation and amortization			39,300						36,316						2,984						8.2		%
General and administrative expenses			7,703						6,630						1,073						16.2		%
Net operating income			$	55,303					$	51,613					$	3,690					7.1		%
Revenue
Same-store			$	80,521					$	79,056					$	1,465					1.9		%
Non-same-store			8,677						1,202						7,475						621.9		%
Other properties			1,296						1,375						(79)						(5.7)		%
Dispositions			2,810						6,683						(3,873)						(58.0)		%
Total			93,304						88,316						4,988						5.6		%
Property operating expenses, including real estate taxes
Same-store			32,906						32,222						684						2.1		%
Non-same-store			2,935						504						2,431						482.3		%
Other properties			557						530						27						5.1		%
Dispositions			1,603						3,447						(1,844)						(53.5)		%
Total			38,001						36,703						1,298						3.5		%
Net operating income
Same-store			47,615						46,834						781						1.7		%
Non-same-store			5,742						698						5,044						722.6		%
Other properties			739						845						(106)						(12.5)		%
Dispositions			1,207						3,236						(2,029)						(62.7)		%
Total			$	55,303					$	51,613					$	3,690					7.1		%

S-5

Reconciliation of Same-Store Controllable Expenses to Total Property Operating Expenses, Including Real Estate Taxes

Same-store controllable expenses exclude real estate taxes and insurance, in order to provide a measure of expenses that are within management's control, and is used for the purposes of budgeting, business planning, and performance evaluation. This is a non-GAAP financial measure and should not be considered an alternative to total expenses or total property operating expenses.

			(in thousands, except percentages)
			Three Months Ended June 30,																											Six Months Ended June 30,
			2021						2020						$ Change						% Change									2021						2020						$ Change						% Change
Controllable expenses
On-site compensation(1)			$	4,427					$	4,089					$	338					8.3		%							$	8,694					$	8,545					$	149					1.7		%
Repairs and maintenance			2,405						2,435						(30)						(1.2)		%							4,497						4,665						(168)						(3.6)		%
Utilities			2,367						2,174						193						8.9		%							5,298						5,080						218						4.3		%
Administrative and marketing			885						876						9						1.0		%							1,746						1,742						4						0.2		%
Total			$	10,084					$	9,574					$	510					5.3		%							$	20,235					$	20,032					$	203					1.0		%
Non-controllable expenses
Real estate taxes			$	4,929					$	4,784					$	145					3.0		%							$	9,853					$	9,719					$	134					1.4		%
Insurance			1,515						1,209						306						25.3		%							2,818						2,471						347						14.0		%
Total			$	6,444					$	5,993					$	451					7.5		%							$	12,671					$	12,190					$	481					3.9		%
Property operating expenses, including real estate taxes - non-same-store			$	1,439					$	385					$	1,054					273.8		%							$	2,935					$	504					$	2,431					482.3		%
Property operating expenses, including real estate taxes - other properties			268						252						16						6.3		%							557						530						27						5.1		%
Property operating expenses, including real estate taxes - dispositions			525						1,566						(1,041)						(66.5)		%							1,603						3,447						(1,844)						(53.5)		%
Total property operating expenses, including real estate taxes			$	18,760					$	17,770					$	990					5.6		%							$	38,001					$	36,703					$	1,298					3.5		%

(1)On-site compensation for administration, leasing, and maintenance personnel.

Reconciliation of Net Income (Loss) Available to Common Shareholders to Funds From Operations and Core Funds From Operations

Centerspace believes that FFO, which is a non-GAAP financial measure used as a standard supplemental measure for equity real estate investment trusts, is helpful to investors in understanding its operating performance, primarily because its calculation does not assume that the value of real estate assets diminishes predictably over time, as implied by the historical cost convention of GAAP and the recording of depreciation.

Centerspace uses the definition of FFO adopted by the National Association of Real Estate Investment Trusts, Inc. (“Nareit”). Nareit defines FFO as net income or loss calculated in accordance with GAAP, excluding:

•depreciation and amortization related to real estate;

•gains and losses from the sale of certain real estate assets; and

•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.

The exclusion in Nareit’s definition of FFO of impairment write-downs and gains and losses from the sale of real estate assets helps to identify the operating results of the long-term assets that form the base of the company's investments, and assists management and investors in comparing those operating results between periods.

Due to the limitations of the Nareit FFO definition, Centerspace has made certain interpretations in applying this definition. The company believes that all such interpretations not specifically identified in the Nareit definition are consistent with this definition. Nareit’s FFO White Paper 2018 Restatement clarified that impairment write-downs of land related to a REIT’'s main business are excluded from FFO and a REIT has the option to exclude impairment write-downs of assets that are incidental to its main business.

While FFO is widely used by Centerspace as a primary performance metric, not all real estate companies use the same definition of FFO or calculate FFO in the same way. Accordingly, FFO presented here is not necessarily comparable to FFO

S-6

presented by other real estate companies. FFO should not be considered as an alternative to net income or any other GAAP measurement of performance, but rather should be considered as an additional, supplemental measure. FFO also does not represent cash generated from operating activities in accordance with GAAP, nor is it indicative of funds available to fund all cash flow needs, including the ability to service indebtedness or make distributions to shareholders.

Core Funds from Operations (“Core FFO”) is FFO as adjusted for non-routine items or items not considered core to business operations. By further adjusting for items that are not considered part of core business operations, the company believes that Core FFO provides investors with additional information to compare core operating and financial performance between periods. Core FFO should not be considered as an alternative to net income, or any other GAAP measurement of performance, but rather should be considered an additional supplemental measure. Core FFO also does not represent cash generated from operating activities in accordance with GAAP, nor is it indicative of funds available to fund the company's cash needs, including its ability to service indebtedness or make distributions to shareholders. Core FFO is a non-GAAP and non-standardized financial measure that may be calculated differently by other REITs and should not be considered a substitute for operating results determined in accordance with GAAP.

						(in thousands, except per share amounts)
						Three Months Ended																																	Six Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020									6/30/2021						6/30/2020
Funds From Operations
Net income (loss) available to common shareholders						$	19,931					$	(6,474)					$	(5,985)					$	18,021					$	(5,387)								$	13,457					$	(13,826)
Adjustments:
Noncontrolling interests – Operating Partnership						1,386						(469)						(460)						1,387						(447)									917						(1,139)
Depreciation and amortization						19,308						19,992						20,282						18,995						18,156									39,300						36,316
Less depreciation – non real estate						(87)						(98)						(87)						(85)						(88)									(185)						(181)
Less depreciation – partially owned entities						(24)						(24)						(33)						(31)						(33)									(48)						(315)
(Gain) loss on sale of real estate						(26,840)						—						(17)						(25,676)						190									(26,840)						190
FFO applicable to common shares and Units						$	13,674					$	12,927					$	13,700					$	12,611					$	12,391								$	26,601					$	21,045
Adjustments to Core FFO:
Casualty (gain) loss						—						—						204						545						—									—						—
Loss on extinguishment of debt						3						—						2						4						17									3						17
Rebranding costs						—						—						402						—						—									—						—
Technology implementation costs						447						413						—						—						—									860						—
(Gain) loss on marketable securities						—						—						—						—						(175)									—						3,378
(Discount) premium on redemption of preferred shares						—						—						—						1						(25)									—						(298)
Core FFO applicable to common shares and Units						$	14,124					$	13,340					$	14,308					$	13,161					$	12,208								$	27,464					$	24,142
Funds from operations applicable to common shares and Units						$	13,674					$	12,927					$	13,700					$	12,611					$	12,391								$	26,601					$	21,045
Dividends to preferred unitholders						160						160						160						160						160									320						320
Funds from operations applicable to common shares and Units - diluted						$	13,834					$	13,087					$	13,860					$	12,771					$	12,551								$	26,921					$	21,365
Core funds from operations applicable to common shares and Units						$	14,124					$	13,340					$	14,308					$	13,161					$	12,208								$	27,464					$	24,142
Dividends to preferred unitholders						160						160						160						160						160									320						320
Core funds from operations applicable to common shares and Units - diluted						$	14,284					$	13,500					$	14,468					$	13,321					$	12,368								$	27,784					$	24,462
Per Share Data
Earnings (loss) per share and Unit - diluted						$	1.48					$	(0.49)					$	(0.46)					$	1.38					$	(0.44)								$	1.02					$	(1.13)
FFO per share and Unit - diluted						$	0.95					$	0.92					$	0.97					$	0.90					$	0.93								$	1.87					$	1.58
Core FFO per share and Unit - diluted						$	0.98					$	0.95					$	1.02					$	0.94					$	0.91								$	1.93					$	1.81
Weighted average shares and Units - diluted						14,514						14,282						14,222						14,143						13,558									14,402						13,482

S-7

Reconciliation of Net Income (Loss) Available to Common Shareholders to Adjusted EBITDA

Adjusted EBITDA is earnings before interest, taxes, depreciation, amortization, gain/loss on sale of real estate and other investments, impairment of real estate investments, gain/loss on extinguishment of debt, gain/loss from involuntary conversion; and other non-routine items or items not considered core to business operations. The company considers Adjusted EBITDA to be an appropriate supplemental performance measure because it permits investors to view income from operations without the effect of depreciation, the cost of debt, or non-operating gains and losses. Adjusted EBITDA is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP.

						(in thousands)
						Three Months Ended																																	Six Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020									6/30/2021						6/30/2020
Adjusted EBITDA
Net income (loss) available to common shareholders						$	21,538					$	(4,867)					$	(4,378)					$	19,629					$	(3,803)								$	16,671					$	(10,810)
Adjustments:
Dividends to preferred unitholders						160						160						160						160						160									320						320
Noncontrolling interests – Operating Partnership						1,386						(469)						(460)						1,387						(447)									917						(1,139)
Income (loss) before noncontrolling interests – Operating Partnership						$	23,084					$	(5,176)					$	(4,678)					$	21,176					$	(4,090)								$	17,908					$	(11,629)
Adjustments:
Interest expense						7,075						7,216						6,888						6,756						6,926									14,291						13,690
Loss on extinguishment of debt						3						—						2						4						17									3						17
Depreciation/amortization related to real estate investments						19,284						19,969						20,250						18,964						18,123									39,253						36,001
Casualty (gain) loss						—						—						204						545						—									—						—
Interest income						(583)						(407)						(328)						(256)						(331)									(990)						(928)
(Gain) loss on sale of real estate and other investments						(26,840)						—						(17)						(25,676)						190									(26,840)						190
Technology implementation costs						447						413						—						—						—									860						—
(Gain) loss on marketable securities						—						—						—						—						(175)									—						3,378
Adjusted EBITDA						$	22,470					$	22,015					$	22,321					$	21,513					$	20,660								$	44,485					$	40,719

S-8

CENTERSPACE

DEBT ANALYSIS

(in thousands)

Debt Maturity Schedule

Annual Expirations

						Future Maturities of Debt
						Secured Fixed Debt						Unsecured Fixed Debt(1)						Unsecured Variable Debt						Total Debt						% of Total Debt						Weighted Average Interest Rate(2)
2021 (remainder)						$	12,814					$	—					$	—					$	12,814					1.8		%				5.73		%
2022						33,028						50,000						37,000						120,028						17.3		%				3.14		%
2023						43,163						—						—						43,163						6.2		%				4.02		%
2024						—						70,000						—						70,000						10.1		%				3.66		%
2025						32,518						75,000						—						107,518						15.5		%				4.34		%
Thereafter						166,840						175,000						—						341,840						49.1		%				3.58		%
Total debt						$	288,363					$	370,000					$	37,000					$	695,363					100.0		%				3.70		%

(1)Term loans have variable interest rates that are fixed with interest rate swaps and $50.0 million of the variable interest, line of credit is fixed with an interest rate swap.

(2)Weighted average interest rate of debt that matures during the year, including the effect of interest rate swaps on the term loans and line of credit.

						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020
Debt Balances Outstanding
Secured fixed rate						$	288,363					$	295,001					$	298,445					$	314,511					$	325,230
Unsecured fixed rate line of credit(1)						50,000						50,000						50,000						50,000						50,000
Unsecured variable rate line of credit						37,000						131,544						102,871						85,000						13,000
Unsecured term loans						145,000						145,000						145,000						145,000						145,000
Unsecured senior notes						175,000						175,000						125,000						125,000						125,000
Debt total						$	695,363					$	796,545					$	721,316					$	719,511					$	658,230
Mortgage debt weighted average interest rate						3.90		%				3.92		%				3.93		%				3.99		%				4.01		%
Lines of credit rate (rate with swap)						2.24		%				2.18		%				2.35		%				3.35		%				2.97		%
Term loan rate (rate with swap)						4.19		%				4.11		%				4.18		%				4.18		%				4.12		%
Senior notes rate						3.47		%				3.47		%				3.78		%				3.78		%				3.78		%
Total debt						3.70		%				3.37		%				3.62		%				3.68		%				3.87		%

(1)A portion of the primary line of credit is fixed through an interest rate swap.

S-9

CENTERSPACE 

CAPITAL ANALYSIS 

(in thousands, except per share and unit amounts)

						Three Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020
Equity Capitalization
Common shares outstanding						14,045						13,220						13,027						12,976						12,827
Operating partnership units outstanding						881						950						977						1,018						1,022
Total common shares and units outstanding						14,926						14,170						14,004						13,994						13,849
Market price per common share (closing price at end of period)						$	78.90					$	68.00					$	70.64					$	65.17					$	70.49
Equity capitalization-common shares and units						$	1,177,661					$	963,560					$	989,243					$	911,989					$	976,216
Recorded book value of preferred shares						$	93,530					$	93,530					$	93,530					$	93,530					$	93,579
Total equity capitalization						$	1,271,191					$	1,057,090					$	1,082,773					$	1,005,519					$	1,069,795
Series D Preferred Units						$	18,022					$	16,560					$	16,560					$	16,560					$	16,560
Debt Capitalization
Total debt						$	695,363					$	796,545					$	721,317					$	719,511					$	658,230
Total capitalization						$	1,984,576					$	1,870,195					$	1,820,650					$	1,741,590					$	1,744,585
Total debt to total capitalization(1)						35		%				43.1		%				39.6		%				41.3		%				37.7		%

(1)Total debt to total market capitalization is total debt from the balance sheet divided by the sum of total debt from the balance sheet, market value of common shares and operating partnership units, and book value of Series C preferred shares and Series D preferred units outstanding at the end of the period.

						Three Months Ended																																	Six Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020									6/30/2021						6/30/2020
Debt service coverage ratio(1)						2.62		x				2.53		x				2.73		x				2.65		x				2.48		x							2.58		x				2.45		x
Adjusted EBITDA/Interest expense plus preferred distributions and principal amortization						2.21		x				2.14		x				2.28		x				2.21		x				2.05		x							2.17		x				2.01		x
Net debt/Adjusted EBITDA(2)						7.68		x				8.92		x				8.07		x				7.97		x				7.33		x							7.76		x				7.44		x
Net debt and preferred equity/Adjusted EBITDA(2)						8.92		x				10.17		x				9.31		x				9.25		x				8.66		x							9.01		x				8.79		x
Distribution Data
Common shares and Units outstanding at record date						14,926						14,171						14,004						13,994						13,849									14,926						13,849
Total common distribution declared						$	10,448					$	9,919					$	9,803					$	9,796					$	9,694								$	20,367					$	18,939
Common distribution per share and Unit						$	0.70					$	0.70					$	0.70					$	0.70					$	0.70								$	1.40					$	1.40
Payout ratio (Core FFO per diluted share and unit basis)(3)						71.4		%				73.7		%				68.6		%				74.5		%				76.9		%							72.5		%				77.3		%

(1)Debt service coverage ratio is computed by dividing Adjusted EBITDA by interest expense and principal amortization. This term is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition included within the Non-GAAP Financial Measures and Reconciliations section.

(2)Net debt is the total debt balance less cash and cash equivalents and net tax deferred exchange proceeds (included within restricted cash). Adjusted EBITDA is annualized for periods less than one year. Net debt and adjusted EBITDA are non-GAAP financial measures and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition included within the Non-GAAP Financial Measures and Reconciliations section.

(3)Payout ratio (Core FFO per diluted share and unit basis) is the ratio of the current quarterly or annual distribution rate per common share and unit divided by quarterly or annual Core FFO per diluted share and unit. This term is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP.

S-10

CENTERSPACE

SAME-STORE SECOND QUARTER COMPARISONS

(in thousands, except property data amounts and percentages)

						Apartment Homes Included						Revenues																		Expenses																		NOI
Regions												Q2 2021						Q2 2020						% Change						Q2 2021						Q2 2020						% Change						Q2 2021						Q2 2020						% Change
Denver, CO						992						$	5,486					$	5,287					3.8		%				$	1,837					$	1,612					14.0		%				$	3,649					$	3,675					(0.7)		%
Minneapolis, MN						2,355						10,538						10,708						(1.6)		%				4,649						4,097						13.5		%				5,889						6,611						(10.9)		%
North Dakota						2,422						8,078						7,768						4.0		%				3,199						3,158						1.3		%				4,879						4,610						5.8		%
Omaha, NE						1,370						4,037						3,838						5.2		%				1,885						1,783						5.7		%				2,152						2,055						4.7		%
Rochester, MN						1,122						4,709						4,594						2.5		%				1,937						1,921						0.8		%				2,772						2,673						3.7		%
St. Cloud, MN						1,192						3,634						3,546						2.5		%				1,582						1,524						3.8		%				2,052						2,022						1.5		%
Other Mountain West						1,223						4,039						3,541						14.1		%				1,439						1,472						(2.2)		%				2,600						2,069						25.7		%
Same-Store Total						10,676						$	40,521					$	39,282					3.2		%				$	16,528					$	15,567					6.2		%				$	23,993					$	23,715					1.2		%

						% of NOI Contribution						Weighted Average Occupancy (1)																		Average Monthly Rental Rate (2)																		Average Monthly Revenue per Occupied Home (3)
Regions												Q2 2021						Q2 2020						Growth						Q2 2021						Q2 2020						% Change						Q2 2021						Q2 2020						% Change
Denver, CO						15.2		%				94.2		%				93.1		%				1.1		%				$	1,727					$	1,774					(2.6)		%				$	1,957					$	1,908					2.7		%
Minneapolis, MN						24.5		%				94.2		%				93.9		%				0.3		%				1,510						1,496						0.9		%				1,584						1,615						(1.9)		%
North Dakota						20.3		%				95.9		%				95.9		%				—						1,078						1,044						3.3		%				1,159						1,114						4.0		%
Omaha, NE						9.0		%				95.5		%				94.9		%				0.6		%				927						904						2.5		%				1,029						984						4.6		%
Rochester, MN						11.6		%				94.5		%				95.4		%				(0.9)		%				1,403						1,386						1.2		%				1,480						1,431						3.4		%
St. Cloud, MN						8.6		%				92.7		%				93.7		%				(1.0)		%				1,005						953						5.5		%				1,097						1,059						3.5		%
Other Mountain West						10.8		%				98.1		%				94.4		%				3.7		%				1,014						952						6.5		%				1,122						1,023						9.7		%
Same-Store Total						100.0		%				94.9		%				94.5		%				0.4		%				$	1,233					$	1,209					2.0		%				$	1,333					$	1,298					2.8		%

(1)Weighted average occupancy is defined as the percentage resulting from dividing actual rental revenue by scheduled rent. Scheduled rental revenue represents the value of all apartment homes, with occupied apartment homes valued at contractual rates pursuant to leases and vacant apartment homes valued at estimated market rents. When calculating actual rents for occupied apartment homes and market rents for vacant homes, delinquencies and concessions are not taken into account. Market rates are determined using the currently offered effective rates on new leases at the community and are used as the starting point in determination of the market rates of vacant apartment homes.

(2)Average monthly rental rate is scheduled rent divided by the total number of apartment homes.

(3)Average monthly revenue per occupied home is defined as total rental revenues divided by the weighted average occupied apartment homes for the period.

S-11

CENTERSPACE

SAME-STORE SEQUENTIAL QUARTER COMPARISONS

(in thousands, except property data amounts and percentages)

						Apartment Homes Included						Revenues																		Expenses																		NOI
Regions												Q2 2021						Q1 2021						% Change						Q2 2021						Q1 2021						% Change						Q2 2021						Q1 2021						% Change
Denver, CO						992						$	5,486					$	5,407					1.4		%				$	1,837					$	1,868					(1.7)		%				$	3,649					$	3,539					3.1		%
Minneapolis, MN						2,355						10,538						10,466						0.7		%				4,649						4,431						4.9		%				5,889						6,035						(2.4)		%
North Dakota						2,422						8,078						7,949						1.6		%				3,199						3,271						(2.2)		%				4,879						4,678						4.3		%
Omaha, NE						1,370						4,037						4,026						0.3		%				1,885						1,762						7.0		%				2,152						2,264						(4.9)		%
Rochester, MN						1,122						4,709						4,643						1.4		%				1,937						1,986						(2.5)		%				2,772						2,657						4.3		%
St. Cloud, MN						1,192						3,634						3,656						(0.6)		%				1,582						1,635						(3.2)		%				2,052						2,021						1.5		%
Other Mountain West						1,223						4,039						3,853						4.8		%				1,439						1,425						1.0		%				2,600						2,428						7.1		%
Same-Store Total						10,676						$	40,521					$	40,000					1.3		%				$	16,528					$	16,378					0.9		%				$	23,993					$	23,622					1.6		%

						% of NOI Contribution						Weighted Average Occupancy																		Average Monthly Rental Rate																		Average Monthly Revenue per Occupied Home
Regions												Q2 2021						Q1 2021						Growth						Q2 2021						Q1 2021						% Change						Q2 2021						Q1 2021						% Change
Denver, CO						15.2		%				94.2		%				94.5		%				(0.3)		%				$	1,727					$	1,715					0.7		%				$	1,957					$	1,922					1.7		%
Minneapolis, MN						24.5		%				94.2		%				92.9		%				1.3		%				1,510						1,494						1.1		%				1,584						1,595						(0.6)		%
North Dakota						20.3		%				95.9		%				96.2		%				(0.3)		%				1,078						1,061						1.6		%				1,159						1,138						1.9		%
Omaha, NE						9.0		%				95.5		%				95.1		%				0.4		%				927						912						1.6		%				1,029						1,030						(0.1)		%
Rochester, MN						11.6		%				94.5		%				95.5		%				(1.0)		%				1,403						1,374						2.1		%				1,480						1,444						2.4		%
St. Cloud, MN						8.6		%				92.7		%				94.6		%				(1.9)		%				1,005						970						3.6		%				1,097						1,081						1.3		%
Other Mountain West						10.8		%				98.1		%				97.7		%				0.4		%				1,014						985						2.9		%				1,122						1,075						4.4		%
Same-Store Total						100.0		%				94.9		%				94.9		%				—						$	1,233					$	1,212					1.7		%				$	1,333					$	1,316					1.3		%

S-12

CENTERSPACE

SAME-STORE YEAR-TO-DATE COMPARISONS

(in thousands, except property data amounts and percentages)

						Apartment Homes Included						Revenues																		Expenses																		NOI
Regions												2021						2020						% Change						2021						2020						% Change						2021						2020						% Change
Denver, CO						992						$	10,893					$	10,798					0.9		%				$	3,704					$	3,416					8.4		%				$	7,189					$	7,382					(2.6)		%
Minneapolis, MN						2,355						21,004						21,477						(2.2)		%				9,080						8,663						4.8		%				11,924						12,814						(6.9)		%
North Dakota						2,422						16,027						15,479						3.5		%				6,470						6,645						(2.6)		%				9,557						8,834						8.2		%
Omaha, NE						1,370						8,063						7,652						5.4		%				3,647						3,409						7.0		%				4,416						4,243						4.1		%
Rochester, MN						1,122						9,353						9,333						0.2		%				3,923						3,858						1.7		%				5,430						5,475						(0.8)		%
St. Cloud, MN						1,192						7,289						7,157						1.8						3,217						3,281						(2.0)		%				4,072						3,876						5.1		%
Other Mountain West						1,223						7,892						7,160						10.2		%				2,865						2,950						(2.9)		%				5,027						4,210						19.4		%
Same-Store Total						10,676						$	80,521					$	79,056					1.9		%				$	32,906					$	32,222					2.1		%				$	47,615					$	46,834					1.7		%

						% of NOI Contribution						Weighted Average Occupancy																		Average Monthly Rental Rate																		Average Monthly Revenue per Occupied Home
Regions												2021						2020						Growth						2021						2020						% Change						2021						2020						% Change
Denver, CO						15.1		%				94.4		%				93.7		%				0.7		%				$	1,721					$	1,783					(3.5)		%				$	1,940					$	1,937					0.2		%
Minneapolis, MN						24.9		%				93.5		%				94.1		%				(0.6)		%				1,502						1,490						0.8		%				1,589						1,616						(1.6)		%
North Dakota						20.1		%				96.0		%				96.0		%				—						1,069						1,040						2.8		%				1,148						1,109						3.5		%
Omaha, NE						9.3		%				95.3		%				94.6		%				0.7		%				919						898						2.3		%				1,029						984						4.7		%
Rochester, MN						11.4		%				95.0		%				96.3		%				(1.3)		%				1,389						1,382						0.5		%				1,462						1,439						1.5		%
St. Cloud, MN						8.6		%				93.6		%				94.3		%				(0.7)		%				988						948						4.2		%				1,089						1,061						2.5		%
Other Mountain West						10.6		%				97.9		%				95.3		%				2.6		%				999						947						5.5		%				1,099						1,024						7.6		%
Same-Store Total						100.0		%				94.9		%				94.9		%				—						$	1,223					$	1,205					1.5		%				$	1,325					$	1,301					1.9		%

S-13

CENTERSPACE

PORTFOLIO SUMMARY(1)

						Three Months Ended
						6/30/2021						3/31/2021						12/31/2020						9/30/2020						6/30/2020
Number of Apartment Homes at Period End
Same-Store						10,676						11,265						10,567						10,567						11,257
Non-Same-Store						903						903						1,343						1,343						878
All Communities						11,579						12,168						11,910						11,910						12,135
Average Monthly Rental Rate(2)
Same-Store						$	1,233					$	1,200					$	1,177					$	1,178					$	1,142
Non-Same-Store						1,617						1,584						1,599						1,597						1,594
All Communities						$	1,263					$	1,229					$	1,225					$	1,210					$	1,175
Average Monthly Revenue per Occupied Apartment Home(3)
Same-Store						$	1,333					$	1,302					$	1,282					$	1,271					$	1,232
Non-Same-Store						1,739						1,705						1,708						1,729						1,681
All Communities						$	1,365					$	1,332					$	1,330					$	1,307					$	1,264
Weighted Average Occupancy(4)
Same-Store						94.9		%				94.9		%				95.0		%				94.4		%				94.6		%
Non-Same-Store						94.2		%				91.8		%				92.3		%				93.9		%				93.9		%
All Communities						94.8		%				94.6		%				94.6		%				94.3		%				94.5		%
Operating Expenses as a % of Scheduled Rent
Same-Store						41.9		%				42.9		%				41.2		%				43.4		%				41.5		%
Non-Same-Store						32.9		%				34.9		%				35.3		%				39.7		%				36.1		%
All Communities						41.0		%				42.1		%				40.3		%				43.0		%				41.0		%
Capital Expenditures
Total Capital Expenditures per Apartment Home – Same-Store						$	159					$	131					$	326					$	293					$	262

(1)Previously reported amounts are not revised for changes in the composition of the same-store properties pool.

(2)Average monthly rental rate is scheduled rent divided by the total number of apartment homes. Scheduled rental revenue represents the value of all apartment homes, with occupied apartment homes valued at contractual rates pursuant to leases and vacant apartment homes valued at estimated market rents. When calculating actual rents for occupied apartment homes and market rents for vacant homes, delinquencies and concessions are not taken into account. Market rates are determined using the currently offered effective rates on new leases at the community and are used as the starting point in determination of the market rates of vacant apartment homes.

(3)Average monthly revenue per occupied home is defined as total rental revenues divided by the weighted average occupied apartment homes for the period.

(4)Weighted average occupancy is the percentage resulting from dividing actual rental revenue by scheduled rent. The company believes that weighted average occupancy is a meaningful measure of occupancy because it considers the value of each vacant unit at its estimated market rate. Weighted average occupancy may not completely reflect short-term trends in physical occupancy and the calculation of weighted average occupancy may not be comparable to that disclosed by other REITs.

S-14

CENTERSPACE

CAPITAL EXPENDITURES

($ in thousands, except per home amounts)

						Three Months Ended															Six Months Ended
						6/30/2021						6/30/2020									6/30/2021						6/30/2020
Total Same-Store Apartment Homes						10,676						10,676									10,676						10,676
Building - Exterior						$	416					$	582								$	900					$	761
Building - Interior						50						58									107						193
Mechanical, Electrical, & Plumbing						260						1,087									405						1,346
Furniture & Equipment						33						117									63						218
Landscaping & Grounds						87						356
Turnover						850						864									1,383						1,481
Capital Expenditures - Same-Store						$	1,696					$	3,064								$	3,017					$	4,451
Capital Expenditures per Apartment Home - Same-Store						$	159					$	287								$	283					$	417
Value Add						$	4,543					$	4,121								$	7,175					$	6,155
Total Capital Spend - Same-Store						$	6,239					$	7,185								$	10,192					$	10,606
Total Capital Spend per Apartment Home - Same-Store						$	584					$	673								$	955					$	993
All Properties - Weighted Average Apartment Homes						11,775						11,445									11,971						11,384
Capital Expenditures						$	1,791					$	3,373								$	3,346					$	5,183
Capital Expenditures per Apartment Home						$	152					$	295								$	280					$	455
Value Add						4,557						4,165									7,188						6,196
Acquisition Capital						403						(943)									961						535
Total Capital Spend						6,751						6,595									11,495						11,914
Total Capital Spend per Apartment Home						$	573					$	576								$	960					$	1,047
Value Add Capital Expenditures
Interior - Units
Same-Store						$	3,107					$	1,561								$	4,799					$	2,347
Non-Same-Store						9						17									8						13
Total Interior Units						$	3,116					$	1,578								$	4,807					$	2,360
Expected Year 1 Annual ROI						16.4		%				17.0		%							16.6		%				16.7		%
Common Areas and Exteriors
Same-Store						$	1,436					$	2,560								$	2,376					$	3,808
Non-Same-Store						5						27									5						28
Total Common Areas and Exteriors						$	1,441					$	2,587								$	2,381					$	3,836
Expected Year 1 Annual ROI						8.1		%				11.9		%							8.1		%				11.8		%
Total Value-Add Capital Expenditures
Same-Store						$	4,543					$	4,121								$	7,175					$	6,155
Non-Same-Store						14						44									13						41
Total Portfolio Value-Add						$	4,557					$	4,165								$	7,188					$	6,196
Expected Year 1 Annual ROI						13.8		%				13.8		%							13.8		%				13.7		%

S-15

CENTERSPACE

2021 Financial Outlook

(in thousands, except per share and per home amounts)

Centerspace revised its outlook for 2021, which includes the anticipated acquisition of KMS during the third quarter, in the table below.

			Six Months Ended						2021 Previous Outlook Range												2021 Revised Outlook Range
			June 30, 2021						Low						High						Low						High
			YTD Actual						Amount						Amount						Amount						Amount
Same-store growth
Revenue			$	80,521					0.0		%				3.0		%				2.0		%				3.5		%
Controllable expenses			$	20,235					3.5		%				4.5		%				3.0		%				5.0		%
Non-controllable expenses			$	12,671					2.5		%				6.0		%				5.5		%				7.5		%
Total Expenses			$	32,906					3.0		%				5.0		%				4.0		%				6.0		%
Same-store NOI			$	47,615					(1.5)		%				1.5		%				0.5		%				2.0		%
Components of NOI
Same-store NOI			$	47,615					$	96,500					$	99,200					$	95,100					$	96,300
Non-same-store NOI			$	5,742					$	11,400					$	11,600					$	11,800					$	12,000
Other Commercial NOI			$	739					$	1,700					$	1,800					$	1,800					$	1,900
Other Sold NOI			$	1,207					—						—						$	1,200					$	1,200
Total NOI			$	55,303					$	109,600					$	112,600					$	109,900					$	111,400
Accretion (dilution) from investments and capital market activity, excluding impact from change in share count(1)			$	—					(800)						(1,100)						4,350						4,500
Interest expense			$	(14,320)					(29,800)						(31,100)						(28,700)						(28,500)
Preferred dividends			$	(3,214)					(6,430)						(6,430)						(6,430)						(6,430)
Recurring income and expenses
Interest and other income			$	1,002					2,580						2,580						2,580						2,580
General and administrative and property management			$	(11,555)					(23,300)						(22,500)						(23,500)						(23,000)
Casualty losses			$	(74)					(1,750)						(1,250)						(1,245)						(755)
Non-real estate depreciation and amortization			$	(185)					(280)						(280)						(280)						(280)
Non-controlling interest			$	(36)					(65)						(70)						(70)						(65)
Total recurring income and expenses			$	(10,848)					(22,815)						$	(21,520)					(22,515)						$	(21,520)
FFO			$	26,921					$	49,755					$	52,450					$	56,605					$	59,450
Non-core income and expenses
Casualty loss			$	—					$	480					$	420					$	280					$	120
Technology implementation costs			860						1,090						990						1,800						1,600
Loss on extinguishment of debt			3						—						—						—						—
Total non-core income and expenses			$	863					$	1,570					$	1,410					$	2,080					$	1,720
Core FFO			$	27,784					$	51,325					$	53,860					$	58,685					$	61,170
EPS - Diluted			$	1.02					$	0.10					$	0.50					$	0.58					$	0.76
FFO per diluted share			$	1.87					$	3.38					$	3.62					$	3.64					$	3.83
Core FFO per diluted share			$	1.93					$	3.48					$	3.72					$	3.78					$	3.94
Weighted average shares outstanding - diluted			14,402						14,731						14,472						15,541						15,541
Additional Assumptions
Same-store capital expenditures (per home)			$	283					$	912					$	1,012					$	875					$	925
Value-add expenditures			$	7,188					$	15,000					$	20,000					$	15,000					$	20,000
Investments			$	76,900					$	145,000					$	170,000					$	400,000					$	400,000
Dispositions			$	60,000					$	55,000					$	75,000					$	60,000					$	60,000
Equity issuance proceeds			$	66,495					$	50,000					$	70,000					$	66,500					$	66,500

(1)Represents net accretion from anticipated KMS acquisition

S-16

Reconciliation of Net Income (Loss) Available to Common Shareholders to FFO and Core FFO

The following table presents reconciliations of Net income (loss) available to common shareholders to FFO and Core FFO, which are non-GAAP financial measures described in greater detail under “Non-GAAP Financial Measures and Reconciliations.” They should not be considered as alternatives to net income or any other GAAP measurement of performance, but rather should be considered as an additional, supplemental measure. FFO and Core FFO also do not represent cash generated from operating activities in accordance with GAAP, nor are they indicative of funds available to fund all cash needs, including the ability to service indebtedness or make distributions to shareholders. The outlook and projections provided below are based on current expectations and are forward-looking.

									Previous Outlook												Revised Outlook
			Six Months Ended						12 Months Ended												12 Months Ended
			June 30, 2021						December 31, 2021												December 31, 2021
			Actual						Low						High						Low						High
Net income (loss) available to common shareholders			$	13,457					$	2,929					$	8,692					$	10,479					$	13,324
Noncontrolling interests - Operating Partnership			917						(1,456)						(1,456)						(1,456)						(1,456)
Depreciation and amortization			39,300						72,391						72,323						74,157						74,157
Less depreciation - non real estate			(185)						(280)						(280)						(280)						(280)
Less depreciation - partially owned entities			(48)						(95)						(95)						(95)						(95)
(Gain) loss on sale of real estate			(26,840)						(24,374)						(27,374)						(26,840)						(26,840)
Dividends to preferred unitholders			320						640						640						640						640
FFO applicable to common shares and Units			$	26,921					$	49,755					$	52,450					$	56,605					$	59,450
Adjustments to Core FFO:
Casualty loss write off			—						480						420						280						120
Loss on extinguishment of debt			3						—						—						—						—
Technology implementation costs			860						1,090						990						1,800						1,600
Core FFO applicable to common shares and Units			$	27,784					$	51,325					$	53,860					$	58,685					$	61,170
Earnings per share - diluted			$	1.02					$	0.10					$	0.50					$	0.58					$	0.76
FFO per share - diluted			$	1.87					$	3.38					$	3.62					$	3.64					$	3.83
Core FFO per share - diluted			$	1.93					$	3.48					$	3.72					$	3.78					$	3.94

Reconciliation of Operating Income to Net Operating Income

Net operating income, or NOI, is a non-GAAP financial measure which the company defines as total real estate revenues less property operating expenses, including real estate taxes. Centerspace believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by depreciation, amortization, financing, property management overhead, casualty losses, and general and administrative expenses. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common shareholders, or cash flow from operating activities as a measure of financial performance.

									Previous Outlook												Revised Outlook
			Six Months Ended						12 Months Ended												12 Months Ended
			June 30, 2021						December 31, 2021												December 31, 2021
			Actual						Low						High						Low						High
Operating income			$	4,374					$	12,159					$	16,527					$	10,998					$	13,488
Adjustments:
General and administrative and property management expenses			11,555						23,300						22,500						23,500						23,000
Casualty loss			74						1,750						1,250						1,245						755
Depreciation and amortization			39,300						72,391						72,323						74,157						74,157
Net operating income			$	55,303					$	109,600					$	112,600					$	109,900					$	111,400

S-17