Management has accelerated deployment of capital into markets with robust demographic tailwinds, most notably Salt Lake City and Austin. Recent acquisitions totaling $150 million in GLA target submarkets where population growth exceeds 2.5% annually and household formation is outpacing national averages by 30%. These moves are expected to lift same-store net operating income growth by 100 basis points in fiscal 2026, driven by rental rate premiums of 8% above portfolio averages in these fast-growing regions. Centerspace currently offers a 5.7% dividend yield that is covered by operating cash flow at a payout ratio below 70%, providing a margin of safety for income investors. The stock trades at a forward price to funds from operations multiple of just 10.9, well below its five-year average of 14.2, suggesting potential upside as valuation multiples normalize. With a cost of capital hovering near 6% for comparable REITs, CSR’s yield spread of nearly 60 basis points further underscores its relative value in the real estate income universe. In the quarter ended June 30, 2025, CSR reported FFO of $1.28 per share, beating consensus by $0.02 and up 0.8% year-over-year. Same-store revenue increased 4.5% while same-store expenses rose just 2.1%, reflecting disciplined cost management and economies of scale. Portfolio occupancy stood at 96.3%, the highest level since 2022, supporting a 3.2% increase in average effective rent. With leverage at 5.1x net debt to EBITDA and liquidity of $350 million, the REIT maintains financial flexibility to pursue accretive acquisitions and fund dividend growth.
Management has accelerated deployment of capital into markets with robust demographic tailwinds, most notably Salt Lake City and Austin. Recent acquisitions totaling $150 million in GLA target submarkets where population growth exceeds 2.5% annually and household formation is outpacing national averages by 30%. These moves are expected to lift same-store net operating income growth by 100 basis points in fiscal 2026, driven by rental rate premiums of 8% above portfolio averages in these fast-growing regions. Centerspace currently offers a 5.7% dividend yield that is covered by operating cash flow at a payout ratio below 70%, providing a margin of safety for income investors. The stock trades at a forward price to funds from operations multiple of just 10.9, well below its five-year average of 14.2, suggesting potential upside as valuation multiples normalize. With a cost of capital hovering near 6% for comparable REITs, CSR’s yield spread of nearly 60 basis points further underscores its relative value in the real estate income universe. In the quarter ended June 30, 2025, CSR reported FFO of $1.28 per share, beating consensus by $0.02 and up 0.8% year-over-year. Same-store revenue increased 4.5% while same-store expenses rose just 2.1%, reflecting disciplined cost management and economies of scale. Portfolio occupancy stood at 96.3%, the highest level since 2022, supporting a 3.2% increase in average effective rent. With leverage at 5.1x net debt to EBITDA and liquidity of $350 million, the REIT maintains financial flexibility to pursue accretive acquisitions and fund dividend growth.