stockrowWhat it does
UDR is a real estate investment trust, or REIT, that owns and manages apartment communities in the United States. It rents apartment homes to residents and also buys, renovates, develops and sells communities. Its portfolio includes properties it owns directly and interests held through partnerships and joint ventures.
At December 31, 2025, UDR’s consolidated portfolio comprised 165 communities in 21 markets, with 55,240 completed apartment homes. It also held interests in 12,167 completed or to-be-completed homes through unconsolidated joint ventures or partnerships, including homes owned by entities in which UDR held preferred equity investments.
The company was founded in 1972 and is headquartered in Highlands Ranch, Colorado. Thomas W. Toomey is its chairman, president and chief executive officer.
UDR uses its own property management and operating systems to serve residents. Residents can apply for or renew leases online and submit maintenance requests through a web portal or app. The company also manages some properties owned with partners. In 2026, it closed a joint venture with Apollo and retained responsibility for operating and managing the venture’s apartments for an asset management fee.
As a REIT, UDR generally must distribute at least 90% of its REIT taxable income, excluding net capital gains, to stockholders annually. Subject to meeting REIT requirements, it generally does not pay corporate-level federal income tax on the income it distributes.
How it makes money
UDR earns rental revenue from apartment residents. Its property cash flow depends on rental rates, occupancy and the expenses of operating the communities. The majority of its apartment leases have initial terms of 12 months or less, giving the company opportunities to adjust rents as leases turn over, subject to market conditions and applicable rules.
UDR reports two operating segments. Same-Store Communities are properties that meet its ownership and stabilization criteria and are not planned for substantial redevelopment or classified for sale at year end. Non-Mature Communities/Other includes properties that do not meet those criteria, such as recently acquired, developed or redeveloped communities, as well as non-apartment parts of mixed-use properties. For the year ended December 31, 2025, Same-Store Communities provided 95.0% of UDR’s total net operating income, a measure of rental revenue less rental and other operating expenses excluding property management.
UDR can also earn income from interests in joint ventures and preferred equity investments, management services and property sales. In the Apollo venture, UDR contributed 19 apartment communities totaling more than 7 thousand apartment homes. It received $1.34 billion of equity capital for a 2-thirds interest and retained a 1-third interest. UDR will continue to manage the properties for a fee; that fee is eliminated in consolidation and reflected through a lower noncontrolling-interest deduction.
Total revenue increased 2.4% in 2025 over the prior year. UDR reported third quarter 2026 adjusted funds from operations of $0.65 per share. Net income attributable to common stockholders was $372.9 million in 2025, with higher gains from real estate dispositions among the principal drivers of the increase from the prior year.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Management Services | $11.4 million | 100.0% | 37.3% |
Customers and how it sells
UDR’s customers are primarily people renting homes in its apartment communities. Residents can conduct leasing and maintenance business through the company’s web portal or a smart-device app. UDR also earns an asset management fee for operating the apartment portfolio in its venture with Apollo.
At December 31, 2025, the consolidated portfolio was in 12 states plus the District of Columbia. Its 21 markets included coastal and Sunbelt locations. The company’s apartment communities included both urban and suburban properties, with an approximate 32%/68% urban/suburban mix at year end.
UDR selects markets using factors that include job and income growth, the tendency to rent, the relative affordability of renting versus owning, and apartment supply and demand. It also considers a property’s proximity to jobs, transportation, entertainment and its existing communities.
In the third quarter of 2026, UDR said around 20% of its net operating income came from the Sunbelt. It said Dallas represented nearly 10% of net operating income and Florida less than 10% at that point. Portfolio composition can change through acquisitions, sales and contributions to joint ventures.
Suppliers and costs
UDR’s costs include personnel, utilities, property repairs and maintenance, real estate taxes, administration and marketing. Increases in wages, utilities and repair and maintenance costs can affect its results. Inflation can also raise interest costs on variable-rate or refinanced debt and increase development and other operating costs.
The company expenses spending needed to keep a property in ordinary operating condition. It capitalizes qualifying expenditures that materially enhance an asset or substantially extend its useful life, as well as qualifying costs directly related to development and redevelopment projects. During 2025, UDR incurred $56.1 million in major renovations involving structural changes or architectural revisions.
UDR finances its activities through property cash flow, borrowing, debt and equity issuance, and property sales. Its capital spending includes acquisitions, development, redevelopment and improvements. Development projects can encounter higher material and labor costs, supply-chain disruptions or delays in obtaining permits. UDR also uses qualified environmental consultants to inspect proposed acquisitions.
- Revenue$1.7B
- Cost of revenue−$624.8M
- Selling, general and administrative−$85.1M
- Other operating costs−$448.8M
- Operating income$553.6M
Competitive position
UDR competes for residents with other apartment communities across its markets. Competing properties may offer different amenities, lower rents or rental concessions, and some are newer or larger. Each community’s position depends in part on local supply and demand.
UDR also competes to acquire, redevelop and develop properties. Other real estate investors include insurance companies, pension and investment funds, public and private real estate companies, investment companies and apartment REITs. Some may have greater resources or lower capital costs than UDR. No individual competing companies are named.
UDR identifies its integrated property management, development, acquisition, marketing and financing capabilities as competitive advantages. It also points to its operating systems, access to capital, geographic reach and presence within local markets. Residents can use digital tools for leasing and service requests, while UDR uses analytics in capital allocation decisions.
Our reading: Local scale and integrated operations provide some operating advantages, particularly where nearby properties can share resources, but they do not remove competition from other communities. Our reading: Digital systems and analytics may help UDR manage properties and select investments, though the available evidence does not establish that competitors cannot replicate them. Our reading: Geographic diversification limits reliance on any one market, but it is less a barrier to competitors than a way to spread local market exposure.
Growth opportunities
UDR seeks growth through its existing communities as well as acquisitions, development, redevelopment and joint ventures. It aims to improve rental rates and property performance through operations and renovation, while buying and selling properties as opportunities and real estate cycles change.
Total revenue increased 2.4% in 2025 over the prior year, driven primarily by market rent growth and communities acquired or completed during 2024, partly offset by property sales. Same-Store revenue also grew 2.4% in 2025, while Same-Store net operating income grew 2.3%.
At December 31, 2025, UDR was developing a wholly owned community in Riverside, California, with 300 apartment homes. It subsequently commenced development of a 385-apartment-home community in Northern Virginia. UDR also acquired a lease-up property in California’s Inland Empire that had been part of its debt and preferred equity portfolio, and agreed to acquire a second property from the same partner. The company expected that second transaction to close in the first half of 2027.
UDR is running off its debt and preferred equity book. It has also expanded joint ventures: in 2026, it contributed a Nashville community to its LaSalle venture and closed the Apollo partnership. UDR said approximately 1 third of the Apollo proceeds was directed toward debt reduction, with the remaining 2 thirds intended to fund wholly owned acquisitions and share repurchases.
- $1.3BFY2021
- $1.5BFY2022
- $1.6BFY2023
- $1.7BFY2024
- $1.7BFY2025
Structural risks
- Apartment demand and supply: Economic downturns, unemployment, local oversupply or weaker household formation can reduce occupancy, rents and property values. Residents’ financial difficulties can also make rent collection harder.
- Housing regulation: Rent control, stabilization or other rental-housing laws could limit UDR’s ability to raise rents to offset higher operating costs. Changes in tax and housing laws can also affect its communities.
- Financing and interest rates: Higher interest rates can increase interest costs and affect cash flow. UDR may face difficulty accessing capital, refinancing debt or obtaining financing for acquisitions and development on favorable terms.
- Property investment and development: Acquired properties may not achieve expected occupancy, rents or expenses. Development can face permit delays, supply-chain constraints, higher labor and material costs, or rents that do not compensate for higher construction costs.
- Joint venture control: Each venture agreement is negotiated separately, and its terms may limit UDR’s ability to operate or dispose of a community at its sole discretion. Returns also depend on the performance and financial condition of the venture.
- REIT qualification: Failure to qualify as a REIT could subject UDR to corporate income taxes and may prevent it from qualifying again for four years.
Bottom line
Our reading
UDR is an apartment landlord whose recurring property income depends on occupancy, rents and operating costs across its markets. Its joint ventures provide another way to own and manage properties and access capital, while sharing ownership and, depending on the agreement, control. Geographic diversification and operating capabilities help spread and manage exposure, but local supply, regulation, financing costs and development execution remain material risks.