Q3 2025 Kennedy-Wilson Holdings Inc Earnings Call

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Please note this event is being recorded.

I would now like to hand, the conference over to Devin Bhavsar head of Investor Relations. Please go ahead.

William McMorrow: Year-to-date, we have generated $470 million of cash from our asset sales to KW and exceeded our target of $400 million for the year. We have achieved real progress on our initiatives over the last two years to grow our investment management business. In 2023, we added a credit team from Origen Bank, growing that platform from $4 billion to $10 billion in AUM today. In 2024, we launched our UK single-family rental platform. As I mentioned, targeting $1.3 billion in asset purchases, where we are approximately 50% committed against that target. In September, we announced our pending acquisition of Toll Brothers Apartment Living Platform, including its in-house development team. The transaction will include a minority interest in 18 apartment communities and student housing properties, $3 billion of assets that Kennedy-Wilson will manage on behalf of Toll Brothers, and a development pipeline which would total approximately $3.6 billion.

Thank you and good morning. Thank you for joining US today today's call will be webcast live and will be archived for replay the replay will be available by phone for one week and by webcast for three months. Please see the Investor Relations website for more information with me today are Bill Mcmorrow, CEO, Matt Windisch, President, Justin embodies CFO and Mike Pegler President of Europe.

On this call, we will refer to certain non-GAAP financial measures, including adjusted EBITDA and adjusted net income you can find a description of these items along with a reconciliation of the most directly comparable GAAP financial measure and our third quarter 2025 earnings release, which is posted on the Investor Relations section of our website statements made during this call may include forward.

Looking statements actual results may materially differ from forward looking information discussed on this call due to the number of risks uncertainties and other factors indicated in reports and filings with the Securities and Exchange Commission.

As you may have seen in our form 8-K that we filed on Tuesday, The board of directors of the company received a proposal letter from a consortium consisting of Bill Mcmorrow, Chairman and CEO and Fairfax Financial Holdings limited about a potential take private transaction. The board has formed a special committee to evaluate the proposal and its options the company does not planted.

Provide any updates on an ongoing basis until there is a definitive transaction to announce or the process has been terminated we will not be taking any questions with respect to this potential transaction or any related matters on today's call I would now like to turn the call over to Bill Mcmorrow.

William McMorrow: In new development projects, this combination will create immediate scale for our investment management platform. First, the acquisition will immediately add $5 billion to assets under management and includes a portfolio of 21,000 existing and planned units. On a pro forma basis, our total AUM is expected to increase to $36 billion, of which over 70% will be attributable to rental housing. Our national rental housing platform would grow to over 90,000 units, inclusive of the units we currently own, we are financing, or have in the development pipeline. Turning to the markets in general, we continue to see improvement in both the cost of capital and availability of capital, with lower borrowing costs and spreads supportive of higher transaction levels. Rental fundamentals remain strong, as the structural undersupply of housing across all our markets remains a long-term tailwind, and renting continues to be significantly more affordable than buying.

Thanks, Kevin.

We reported our results for the third quarter of 2025 yesterday, which reflects the progress we achieved on expanding our investment management platform, while executing on our noncore asset sale plan.

Starting with our quarterly highlights we saw improvement across several of our key financial metrics in the quarter, including adjusted EBITDA and adjusted net income compared to Q3 of last year.

Driving our results was the growth in our investment management business with assets under management growing to 31 billion in Q3, which reflects an increase of 11% year over year.

Fee bearing capital grew to $9 7 billion, an increase of 10% from a year ago.

Fee bearing capital has now grown by approximately 20% per year over the last four years.

Growth in our fee business this quarter was driven by capital deployment.

Supported by improving liquidity across the commercial real estate market.

William McMorrow: With that, I'd like to turn the call over to Justin Enbody, our CFO.

We deployed or committed approximately $900 million in Q3, driving total capital deployment to $3 $5 billion year to date through September.

Daven Bhavsar: Thanks, Bill. I'll begin with a review of our Q3 financial results, then discuss the balance sheet. GAAP EPS for the first quarter totaled a loss of $0.15 per share, compared to a loss of $0.56 per share in Q3 of last year. Adjusted EBITDA totaled $125 million in Q3 and was up almost double from $66 million in Q3 of last year. For the year, adjusted EBITDA has increased 6% to $371 million. Q3 baseline EBITDA was steady at $101 million, resulting in trailing 12-month baseline EBITDA of $425 million. Our results reflect further growth in investment management fees, which increased by 8% in the quarter, and an impressive 23% year-to-date.

Capital deployment in the quarter was largely focused towards rental housing related credit and equity investments.

On the credit side, we originated another $600 million, new rental housing construction loans driving total originations to $2 6 billion for the year.

Our share of these loans is two 5%.

Since July of 2023, our credit team has surpassed $6 billion of new loan originations. While also successfully realizing over $2 billion of repayments from loans purchased as part of the Pac Western Bank loan.

Daven Bhavsar: We also saw improving results from our unconsolidated investments, with increases to both our share of revenues, carried interests, and gains on sale, all resulting in a $55 million increase in income from unconsolidated investments compared to Q3 in 2024. Now turning to our balance sheet. In October, we paid off the last tranche of our KWE unsecured bonds, totaling $352 million. This payoff completes the repayment of two legacy bond issuances dating back to 2015, and greatly simplifies our debt capital structure going forward. The payoff was funded in part from cash generated from our recap transactions, asset sales, as well as our line of credit, which we will look to reduce in the next few quarters from additional sales of non-core assets. Our total debt is 96% fixed or hedged, with a weighted average maturity of 4.5 years and a weighted average effective interest rate of 4.7%.

<unk> portfolio transaction.

On the credit side are co mingled U S Fund acquired three multifamily communities and in an industrial property for a combined total of $173 million.

In Europe, our investment activity remains centered around expanding our UK single family rental platform with CPP IB.

There remains a meaningful housing supply demand imbalance driven by population growth as well as the cost of purchasing a new home.

In Q3, we added $62 million of new investments, which brings our total portfolio to 1300 homes.

Since launching in Q4 of last year of the platform was demonstrated good momentum.

Reaching approximately $585 million of committed capital relative to the additional $1 3 billion dollar purchase target.

also successfully realizing over 2 billion dollars of repayments from loans, purchased as part of the PAC, Western Bank Loan portfolio, transaction,

And our coal investment portfolio, we recapitalized to existing U S multifamily joint ventures.

On the credit side, our coal, migle us fund, acquired 3 multi, family communities and an industrial property for a combined total of 173 million.

Daven Bhavsar: We also have $255 million of consolidated unrestricted cash. With that, I'll now hand it over to Matt Windisch for a portfolio update.

Reducing our ownership from 51% to 10%.

We also sold a smaller wholly owned multifamily asset built in 1988 located in suburban Salt Lake City.

Matt Windisch: Thanks, Justin. Our portfolio of stabilized real estate investments generates estimated annual NOI of $434 million to KW, with 70% positioned in our two key conviction sectors: rental housing and industrial. In the rental housing sector, there remains a long-term undersupply of housing, and homeownership remains unaffordable. After record supply last year, future new supply is decreasing. Demand remains strong across our portfolio, with occupancy ending the quarter at over 94%. US same-store NOI grew by 2.4% for our market-rate portfolio. Revenues were up 1.3%, and expenses were down due to favorable property taxes in certain markets, and reduced insurance costs. Leasing spreads totaled 1.4% in Q3, with renewal spreads increasing by 3.4%, and new leasing spreads declining by 1%. At quarter-end, our loss to lease totaled 3.3%. I'd like to highlight a few regional stats. The strongest growth came from our Pacific Northwest portfolio, where NOIs grew by 3%.

In Europe, our investment activity remains centered around expanding our UK single-family rental platform with CPPIB.

Our Q3 sale and recap activity generated approximately $200 million of cash to kw.

The remains of meaningful housing Supply, demand and balance driven by population growth, as well as the cost of purchasing a new home.

$130 million of additional fee bearing capital and $30 million of realized gains.

In Q3, we added 62 million dollars in new Investments which brings our total portfolio to 1300 Holmes.

Year to date, we have generated $470 million of cash from our asset sales to kw and exceeded our target of $400 million for the year.

Since launching in Q4 of last year, the platform has demonstrated good momentum.

Reaching approximately $585 million of committed capital relative to the initial $1.3 billion purchase target.

We have achieved real progress on our initiatives over the last two years to grow our investment management business.

In 2023, we added the credit team from a regional bank.

And our co-investment portfolio. We recapitalize 2 existing us multifamily joint ventures. Reducing our ownership from 51% to 10%.

That platform from $4 billion to $10 billion in AUM today.

In 2024, we launched our UK single single family rental platform.

We also sold a smaller Holio and multifamily assets built in 1988, located in suburban Salt Lake City.

As I mentioned targeting $1 3 billion in asset purchases.

There were approximately 50 committed against that target.

Our Q3 sale and recap activity generated approximately $ dollars of cash to KW.

Matt Windisch: This region benefited from return-to-office mandates, with limited new supply being delivered. The Mountain West, our largest region, saw 2.6% NOI growth. In particular, our assets in Idaho benefited from higher occupancy, lower bad debt, and lower real estate taxes, resulting in 6.8% NOI growth. In Southern California, our lower-density suburban portfolio generated 2% revenue and NOI growth, with same-store occupancy at 96%. While our smallest region, Northern California, saw NOI fall by 1.5%. Our vintage housing affordable portfolio surpassed 11,000 units in the quarter. Same-store NOI was flat in Q3, as rental increases were offset by higher expenses incurred in the quarter. We remain on track to stabilize another 2,000 units, which are currently in lease-up or development. We are also actively evaluating new opportunities to further expand our affordable portfolio platform.

And in.

September we announced our pending acquisition of toll brothers apartment living platform.

130 million of additional fee bearing capital and thirty million dollars of realized gains.

Including its in house development team.

The transaction will include minority interest in 18 of apartment communities in student housing properties.

Here. Today, we have generated $470 million in cash from our asset sales to KW and exceeded our target of $400 million for the year.

$3 billion of assets that Kennedy Wilson will manage on behalf of toll brothers and a development pipeline, which would total approximately $3 $6 billion in new development projects.

We have achieved real progress on our initiatives, over the last 2 years, to grow our investment management business.

This combination will create immediate scale for our investment management platform.

In 2023, we added the credit team from Regional Bank growing that platform from 4 billion to 10 billion in AUM today.

First the acquisition will immediately add $5 billion to assets under management.

In 2024, we launched our UK Fingal single-family rental platform.

And includes a portfolio of 21000 existing and planned units.

As I mentioned, we are targeting $1.3 billion in asset purchases, where we are approximately $0.50 committed against that target.

On a pro forma basis, our total AUM is expected to increase to $36 billion.

And in September, we announced our pending acquisition of Toll Brothers. Apartment living platform.

Of which over 70% will be attributable to rental housing.

Including its in-house development team.

Matt Windisch: In Ireland, same-property occupancy grew by 1.7%, primarily at our newly completed assets, resulting in revenue growth and NOI growth of 6%. Moving over to our office portfolio, 76% of our stabilized office portfolio is in Europe, where same-property NOI decreased by 6% and was impacted by a 5% decline in occupancy. However, our asset management teams have quickly signed agreements for lease for a bulk of the vacated space. Our European stabilized office portfolio ended the quarter with 91% occupancy. In closing, we saw continued growth in our investment management business in Q3, while at the same time monetizing non-core assets. Finally, we look forward to closing the pending transaction with Toll Brothers in Q4. With that, operator, we can open it up to Q&A.

Our national rental housing platform would grow to over 90000 units inclusive of the units. We currently own we are financing or having the development pipeline.

The transaction will include a minority interest in 8, an apartment communities and student housing properties.

Yeah.

Turning to the markets in general we continue to see improvement in both the cost.

$3 billion of assets that Kennedy Wilson will manage on behalf of Toll Brothers and a development pipeline which would total approximately $3.6 billion in new development projects.

Capital and the availability of capital.

Lower borrowing costs and spreads supportive of higher transaction levels.

This combination will create create immediate scale for our investment management platform.

Rental fundamentals remained strong as the <unk>.

First, the acquisition will immediately add 5 billion dollars to assets under management.

Structural under supply of housing across our markets remains a long term tailwind and renting continues to be significantly more affordable than buy.

And includes a portfolio of 21,000 existing and planned units.

With that I'd like to turn the call over to Justin and body our CFO.

Bill I'll begin with a review of our Q3 financial results and then discuss the balance sheet.

On a pro forma basis, our total AUM is expected to increase to $36 billion, of which over 70% will be attributable to rental housing.

Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star and then two. Your first question today will come from Anthony Paolone with JPMorgan. Please go ahead.

GAAP EPS for the first quarter totaled a loss of <unk> 15 per share compared to a loss of <unk> 56 per share in Q3 of last year.

Our National Rental housing platform would grow to over 90,000 units, inclusive of the units. We currently own, we are financing or have in the development pipeline.

Adjusted EBITDA totaled $125 million in Q3 and was up almost double from $66 million in Q3 of last year.

Returning to the markets in general, we continue to see Improvement in both the cost.

For the year, adjusted EBITDA increased 6% to $371 million.

Anthony Paolone: Thanks. I was wondering if you can talk about just where cap rates are for multifamily in your various markets. We saw some of the deals you did in the quarter, I think, were 5.4%, but just maybe generally kind of where do those sit. Also, as it relates to Toll Brothers, if we think about the development platform there for multifamily, where would you develop, and what would the spread be versus market cap rates?

Of capital and availability of capital with lower borrowing costs and spreads supportive of higher transaction levels.

Q3, baseline EBITDA was steady at $101 million.

Resulting in trailing 12 month baseline EBITDA of $425 million.

Our results reflect further growth in investment management fees, which increased by 8% in the quarter and an impressive 23% year to date.

Rental fundamentals, remain strong as a structural under supply of housing. Across our markets remains a long-term, tailwind, and renting continues to be significantly, more affordable than buying

We also saw improving results from our unconsolidated investments with increases to both our share of revenues carried interests and gains on sale, all resulting in a $55 million increase in income from unconsolidated investments compared to Q3 in 2024.

With that. I'd like to turn the call over to Justin andbody our CFO.

Thanks Bill. I'll begin with the review of our Q3 Financial results and then discuss the balance sheet.

Matt Windisch: Hey, Tony, it's Matt. In terms of cap rates we're seeing in the market, it really depends on a number of factors, including age of the assets, the submarket you're in, and what's happening around supply. We've seen things trade in the high 4s. We've seen things trade in the high 5s. It's really kind of a broad range depending on those factors. They seem to be holding relatively steady over the past couple of quarters at those levels. In terms of the Toll Brothers portfolio and the future pipeline, we continue to like the markets they've historically built in. It'll be some of the West Coast markets we currently own and operate, as well as some East Coast markets where we've historically just been a lender.

GAAP EPS for the first quarter totaled a loss of $0.15 per share, compared to a loss of $0.56 per share in Q3 of last year.

Now turning to our balance sheet and.

In October we paid off the last tranche of our KWE unsecured bonds totaling $352 million.

Last year.

This pay off completely completes.

Completes the repayment of two legacy bond issuances dating back to 2015 and greatly simplifies our capital debt capital structure going forward.

For the year adjusted ibida, has increased 6% to 371 million.

Q3 Baseline EPA was steady at 101 million.

The payoff was funded in part from cash generated from our recap transactions asset sales as well as our line of credit, which we will look to reduce and then execute few quarters from additional sales of noncore assets.

Resulting in trailing twelve-month Baseline EBITDA of $425 million.

Our results, reflect further, growth in Investment Management fees, which increase by 8% in the quarter and an impressive 23% year to date.

Our debt.

Total debt is 96% fixed or hedged with a weighted average maturity of four five years and a weighted average effective interest rate of four 7%.

Matt Windisch: We think, generally speaking, again, depending on markets and a number of factors, that we can generally build the spreads of somewhere between 125 and 175 basis points on new developments relative to market cap rates. That's kind of the target in terms of how we'd be looking to capitalize these deals.

We also have $255 million of consolidated unrestricted cash.

We also saw improving results from our unconsolidated investments with increases to both our share of revenues carried interests and gains on sale. All resulting in a 55 million increase in income from unconsolidated Investments compared to Q3 in 2024.

I'll now hand, it over to Matt Windisch for a portfolio update thanks, Justin our portfolio of stabilized real estate investments generate estimated annual NOI of $434 million to kw was 70% positioned in our two key conviction sectors rental housing and industrial.

now, turning to our balance sheet,

Anthony Paolone: Okay. Thanks. I get the sensitivity around the Go Private proposal, but maybe I missed this. Was it outlined who on the board comprises the committee that will kind of go through this and make the decisions?

And the rental housing sector that remains a long term under supply of housing.

In October, we paid off the last tranche of our Quay unsecured bond, totaling $352 million. This payoff completes the repayment of two legacy bond issuances, dating back to 2015, and greatly simplifies our capital structure going forward.

And homeownership remains on affordable.

After a record supply last year, featuring new supply is decreasing demand remained strong across our portfolio with occupancy ending the quarter at over 94%.

Matt Windisch: Yeah, Tony, it's Matt. Again, we can't talk about anything related to the offer that was made a couple of days ago. That was not outlined in the offer, who the special committee may be.

The payoff was funded in part from cash generated from our recap transactions asset sales as well as our line of credit, which we will look to reduce in the next few quarters from additional sales of non-core assets.

Our debt.

U S same store NOI grew by 224% for our market rate portfolio.

Revenues were up one 3% and expenses were down due to favorable property taxes in certain markets and reduced insurance costs.

Anthony Paolone: Okay. All right. Thanks.

Our total debt is 96% fixed or hedged, with a weighted average maturity of 4.5 years and a weighted average effective interest rate of 4.7%.

Operator: Your next question today will come from Yana Galan with Bank of America. Please go ahead.

Leasing spreads totaled one 4% in Q3 with renewal spreads increasing by three 4% and new leasing spreads declining by 1%.

Yana Galan: Thank you, and congrats on a really nice quarter. I was curious if there was any impact thus far from the government shutdown on the affordable multifamily portfolio.

At quarter end, our loss to lease totaled three 3%.

I'd like to highlight a few regional staff the strongest growth came from our Pacific northwest portfolio or NOI grew by 3%.

Matt Windisch: Yeah, I mean, we haven't seen anything. We did see a bit of weakness in terms of NOI in the quarters we pointed out, but that was more expense-driven, not really related to anything from the government shutdown or any subsidies that would be passed on to the tenants. No, we have not to date seen any impact from that yet.

We also have 255 million of Consolidated, unrestricted, cash with that, I'll now hand it over to Matt wendish for a portfolio update. Thanks Justin, our portfolio of stabilized, real estate Investments generates, estimated annual noi of 434 million to KW with 7% positioned in our 2 key conviction, sectors, rental housing and Industrial.

In the rental housing sector. There remains a long-term undersupply of housing.

This region benefited from return to office mandates with limited new supply being delivered.

And Home Ownership remains unaffordable.

The mountain West our largest region saw a two 6% NOI growth in particular, our assets in Idaho benefited from higher occupancy lower bad debt and lower real estate taxes, resulting in six 8% NOI growth.

After records Supply last year. Future new Supply is decreasing demand remains strong across our portfolio. With occupancy, ending the quarter at over. 94%

Yana Galan: Thank you, and congrats on the impressive growth in the investment management platform. Just wondering if you could maybe talk to kind of fundraising right now globally, and where you guys think you're taking market share.

And southern California are our lower density suburban portfolio generated 2% revenue and NOI growth with.

Us same store. Noi grew by 2 2.4% for our market rate. Portfolio revenues were up 1.3% and expenses were down due to favorable. Property taxes in certain markets and reduced Insurance costs.

With same store occupancy at 96%.

While our smallest region, Northern California saw NOI fall by one 5%.

William McMorrow: Yeah, that's a good question. I think it's evident, at least from what I read, that the capital raising, particularly in the private equity firms, there's challenges associated with it. I think what we have seen is that really the discretionary funds have become somewhat less prevalent, unless you're one of the really big capital raisers. Generally speaking, people want to do their capital deployment through separate accounts. I think in our case, we've had good success in really several geographies, particularly in Asia, where we've been for 30 years, and here in the United States and Canada, and parts of Europe. We continue to see our capital deployment increasing, but we think that we've got the capability to raise capital to support all of that.

Our vintage housing affordable portfolio surpassed 11000 units in the quarter.

Leasing spreads totaled, 1.4% in Q3 with renewal spreads, increasing by 3.4% and new leasing spreads declining by 1%.

At quarter end our lost at least total 3, 3%.

Same store NOI was flat in Q3 as rental increases were offset by higher expenses incurred in the quarter.

I'd like to highlight a few Regional stats.

We remain on track to stabilize another 2000 units, which are currently in lease up our developments.

We are also also actively evaluating new opportunities to further expand our affordable portfolio platform.

Strongest growth came from our Pacific Northwest portfolio, where noise grew by 3%. This region benefited from return-to-office mandates, with limited new supply being delivered.

In Ireland same property occupancy grew by one 7% primarily at our newly completed assets, resulting in revenue growth and NOI growth of 6%.

The Mountain West are largest region saw 2.6%. Noi growth in particular, our Assets in Idaho benefited from higher occupancy, lower bad debt, and lower real estate taxes resulting in 6.8%. Noi growth.

Moving over to our office portfolio, 76% of our stabilized office portfolio is in Europe.

In Southern California, our our lower density Suburban portfolio generated 2% revenue and noi growth.

With same store occupancy at 96%.

Our same property NOI decreased by 6% and was impacted by a 5% decline in occupancy.

While our smallest region, Northern California saw noi's Fall by 1.5%.

However, our asset management teams have quickly signed agreements for lease for a bulk of the vacated space.

Our Vintage housing affordable portfolio surpassed 11,000 units in the quarter.

Our European <unk>.

Stabilized office portfolio ended the quarter with 91% occupancy.

Same store NOI was flat in Q3 as rental increases were offset by higher expenses incurred in the quarter.

In closing we saw continued growth in our investment management business in Q3, while at the same time monetizing noncore assets.

Yana Galan: Thank you.

We remain on track to stabilize another 2,000 units, which are currently in lease-up for development.

Operator: If you have a question, please press star and then one. Your next question today will come from Omotayo Okusanya with Deutsche Bank. Please go ahead.

Finally, we look forward to closing the pending transaction with toll brothers in Q4.

We are also actively evaluating new opportunities to further expand our affordable portfolio platform.

With that operator, we can open it up to Q&A.

We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone.

Omotayo Okusanya: Yes. Good afternoon, everyone. In regards to the buyout offer, while I know the company can't make any comments specifically, I don't know if it's possible for Bill to make any comments about why or his rationale for making the offer.

In Ireland, same property occupancy, grew by 1.7% primarily at our newly. Completed assets, resulting in Revenue growth and noi growth of 6%.

You are using a speakerphone please pick up your handset before pressing the keys.

Moving over to our office portfolio.

If at any time. Your question has been addressed and you would like to withdraw your question. Please press Star and then two.

76% of our stabilized office. Portfolio is in Europe.

And your first question today will come from Anthony <unk> with J P. Morgan. Please go ahead.

Matt Windisch: Yeah. Teo, it's Matt again. I'm sorry. We can't comment on anything beyond what we said on the call earlier about the offer that was made.

Alright. Thanks.

In the same property, NOI decreased by 6% and was impacted by a 5% decline in occupancy. However, our asset management teams have quickly signed agreements for lease for a bulk of the vacated space.

I was wondering if you can talk about just where cap rates are.

Omotayo Okusanya: Fair enough. All right. No worries. Next question, just around origination volume from the loan business. Again, granted, Q2 was kind of a record, but in Q3, there is a slowdown. Just kind of curious, is that seasonality? Is that more competition? Just kind of curious what was happening there.

Our European uh stabilized office portfolio ended the quarter with 91% occupancy.

For multifamily in your various markets. We saw some of the deals you did in the quarter I think were $5 four but just maybe generally.

Where do those sit and then also as it relates to toll brothers.

In closing, we saw continued growth in our investment management business in Q3, while at the same time monetizing non-core assets.

If we think about the.

finally, we look forward to closing the pending transaction with Toll Brothers and Q4

The development platform, there for multifamily like where where would you develop.

Uh, with that operator, we can open it up to Q&A.

And like what would the spread be versus like market cap rates.

Matt Windisch: Yeah. Good question. Yeah. Historically, Q3 has been a bit slower, and if you kind of look at the prior year as well, Q3 tends to be just a little lower on the origination volumes, kind of coming out of the summer. Certainly, there's heightened competition. I think we talked about that on the last call, and we've seen some spreads coming in over the past year. We're still very active in the space and have a strong pipeline, and we expect to continue to originate out of that business.

Hey, Tony its Matt so in terms of cap rates, we're seeing in the market.

It really depends on a number of factors, including age of the assets in the Submarket year end and what's happening around supply. So we've seen things trade in the high fours.

Question and answer session to ask a question. You may press star then 1 on your touchtone phone, if you are using a speaker-phone please pick up your handset before pressing the keys.

If at any time your question has been addressed and you would like to withdraw your question. Please press star and then 2

Things trade in the high fives, it's really.

And your first question today will come from Anthony Pallone with JP Morgan. Please go ahead.

And have a broad range, depending on those factors, but they seem to be holding relatively steady over the past couple of quarters at those levels.

Omotayo Okusanya: Okay, that's helpful. If we could go international just for a minute, the SFR platform. Again, some additional acquisitions there. Just kind of talk a little bit about how that's coming along, how that's growing, what the ultimate economics of that business will be.

And then in terms of the.

Toll brothers portfolio.

And kind of the future pipeline, we continue to like the markets they've historically built in.

So it'll be some of the west coast markets, we currently own and operate as well as some east coast markets, where we've historically been a lender.

Matt Windisch: Mike, do you want to touch on that?

And we think generally speaking again depending on.

Anthony Paolone: Yeah. I'll pick that one up. Obviously, we're a year into the venture now. We signed the venture with CPPIB in October last year, I believe, and we've had really good growth over that period. We're really pleased with the number of houses we've committed to, and we're up and running with our leasing. We've got almost 200 houses actually physically built and leased now. Including the acquisitions that we reported today, we're up to, I think, it's about 1,300 homes. We've got a great pipeline ahead of us, and a good appetite for doing more. I think by the year-end in Q4, we're expecting several more acquisitions to complete. We still see a good pipeline coming out of the house builders in the UK, who are seeing this as a way to deliver additional stock, and we have strong support from CPPIB to grow the platform.

Uh, thanks. Um, I was wondering if you can talk about, just where Cap rates are uh, for multi family and your various markets. Um, we saw some of the deals you did in the quarter. I think we're 54, but just, you know, maybe generally, kind of where do those sit? And then also, as it relates to Toll, Brothers, uh, if we think about, you know, the development platform there for multi family like where where would you develop? Uh and like what would the spread be versus like market cap rates?

Markets in a number of factors that we can generally build the spreads are somewhere between $125 175 basis points on new developments relative to market cap rates.

The.

Target in terms of how we would be looking to capitalize these deals.

Okay.

Thanks, and then I get the sensitivity around <unk>.

Hey Tony, it's Matt. So in terms of cap rates we're seeing in the market. It's, you know, it really depends on a number of factors, including, you know, age of the assets and the submarket you're in and what's happening around Supply. So we've, we've seen things trade, you know, in the high fours, we've seen things trade in the high fives. It's really

The go private proposal, but maybe I missed this.

Was it outlined who on the board is on it comprises the committee that will kind of go through this and make the decisions.

Kind of a broad range depending on those factors. Uh but they seem to be you know, holding relatively steady over the past couple quarters um at those levels.

And then, in terms of the, um,

Yes, Tony it's Matt so.

We again, we can't talk about anything related to the offer that was made.

Couple of days ago.

But that was that was not.

Whole Brothers portfolio um, and kind of the future pipeline. You know, we continue to to like the markets. They've historically built in. Um, so it'll be some of the West Coast markets. We currently own and operate, as well as some some East Coast markets where we've historically, just been a lender.

Non outlined in the offer through the special Committee maybe.

um and we think generally speaking, you know, again, depending on

Okay Alright.

Anthony Paolone: I would expect you'll see more acquisitions in Q4, and we look forward to continuing to grow it into 2026 as well. I think we've got some good way to go on this.

Alright. Thanks.

And your next question today will come from <unk> <unk> with Bank of America. Please go ahead.

Markets and a number of factors that we can generally build to spreads of somewhere between 125 and 175 basis points.

Thank you and congrats on a really nice quarter.

On new developments relative to the market cap rates, that's kind of the...

Omotayo Okusanya: Okay, that's helpful. Just kind of still staying international, quick thoughts on UK office. Again, the occupancy decline. Just kind of talk to a little bit about, was that just an actual lease move-out, or was it an actual termination? If you would like to kind of talk about lease-up at Cooper's Crossing as well.

I was curious if there was any impact.

The target in terms of how we will be looking to capitalize these deals.

Thus far from the government shutdown on the affordable multifamily portfolio.

Yes, I mean.

We haven't seen anything there we did see a bit of weakness in terms of NOI in the quarter as we pointed out but that was more expense driven not really related to anything from the government shutdown or any subsidies that would be passed on to the tenants. So now we have not.

Anthony Paolone: Yeah. In terms of UK, we've had a couple of lease move-outs that effectively we've been backfilling, but the backfills haven't kicked in yet. There are a number of cases where we've actually signed agreements for lease that haven't completed. I would expect that occupancy to go back up over the course of the next couple of quarters. In fact, we've got committed deals that are going to send that occupancy back up again. Beyond that, we have a good pipeline of leasing. I don't see a structural problem in our office leasing. It's really a timing issue around the time taken to bring these buildings back into circulation after a couple of lease breaks. Actually, we're releasing at better rents in most cases, and the demand has actually proved decent to the positive side. I think on the UK.

Okay, uh, thanks. And then I, I, I get the sensitivity around the, um, the go private proposal, but maybe I missed. This did did was it outlined who on the board is on like comprises the committee that will kind of go through this and make the decisions?

Yeah, Tony, it's Matt. So, um, we again can't talk about anything related to the offer that was made.

um,

To date seen any impact from that yet.

a couple days ago but that was, that was

Thank you.

<unk> on the impressive growth in the investment management platform I'm, just wondering if you could maybe talk to kind of.

Not outlined in the offer. Who the special committee may be?

Okay, all right. Thanks.

Fundraising right now globally, and where you guys think you are taking market share.

And your next question today, will come from Jana Galan with Bank of America. Please go ahead.

Okay.

Yes, that's a good question.

I think it's.

Evident and at least from what I read that.

The capital raising particularly in the private equity firms as is <unk>.

Thank you. And um congrats on a really nice quarter. Um, I was curious if there was any impact, uh, thus far from from the government shutdown on the affordable multifamily portfolio.

yeah, I mean

<unk> was associated with it I think what we have seen is that.

Anthony Paolone: Office occupancy, I would expect that to tick back up over the next few quarters. In terms of Cooper's Cross, we have a good pipeline. We are under offer to a really interesting tenant who's looking to take some space. Hopefully, we can get that deal done in the next quarter. We've got a good pipeline of interest. It's clearly taken a little bit longer than we'd like, but that market is coming back to life now, and we see a better pipeline than we've seen in quite a while.

We haven't seen anything there. We did see, you know, a bit of

Really the.

Discretionary funds have become somewhat less prevalent.

Unless you're one of the really Big Council razors, and generally speaking people want to do their capital deployment through separate accounts I think the.

Weakness in terms of noi in the in the quarters we pointed out but that was more expense driven not really related to anything from the government shutdown or any subsidies that would be passed on to the tenants. So no we have not.

To date, seen any impact from that yet.

In our case we.

We've had great we've.

We've had good success.

And really really.

Thank you. And um, you know, congrats on the impressive growth in the investment management platform. Just wondering if you could maybe talk to kind of, you know, fundraising right now globally. And where you guys think you're taking market share.

Several geographies, but particularly in Asia, where we've been for 30 years and here in the United States and Canada and.

Omotayo Okusanya: Great. Thank you very much.

Yeah, that's a a good question it. Um,

I think, I think it's

Operator: Closed our question and answer session. I would like to turn the conference back over to Bill McMorrow for any closing remarks.

Parts of Europe, but.

We continue to see our capital deployment, increasing but we think that we've got the capability to raise capital to support all of that.

Evident in at least from what I read that you know, the capital raising.

William McMorrow: Thank you, everybody, for joining the call today. Much appreciated.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Particularly in the private equity firms, there's challenges associated with it. I think what we have seen is that...

Thank you.

really the

Again, if you have a question. Please press star and then one.

And your next question today will come from Tayo Okusanya with Deutsche Bank. Please go ahead.

Hi, good afternoon, everyone.

discretionary funds have become, you know, some Less Problems. Uh, you know, unless you're 1 of the really big Capital raisers and generally speaking people want to do their Capital deployment through separate accounts. I think the uh,

In regards to the buyout offer while I know the company make any comments specifically.

If it's possible for bill to make any comments about why what is the rationale for making the offer.

in our case, you know, we, we've had great, we've had good success in in, in really, really

Several geographies but particularly in Asia where we've been for 30 years?

Yeah, Tayo, it's Matt again, I'm, sorry, we just we can't comment on anything beyond what we said on the call earlier about the.

The offer was made.

Fair enough.

Next question.

Our origination volume in.

And, uh, here in the United States, in Canada, and, you know, parts of Europe. But we continue to see our capital deployment increasing, and we think that we've got the capability to raise capital to support all of that.

um,

From the loan business.

Thank you.

Again granted Cynthia what kind of a record, but it can be Q.

Though down just kind of curious.

Again, if you have a question, please press star and then 1.

His analogy that more complex <unk>, just kind of curious about what was happening there.

And your next question to get today, will come from Tau okusa with Deutsche Bank, please go ahead.

Yes. Good question, yes. So historically Q3 has been a bit slower and if you kind of look at the prior year as well so Q3 tends to be a little lower on.

On the origination volumes kind of coming out of the summer.

And so certainly there is.

Heightened competition I think we've talked about that on the last call and we've seen some spreads spreads coming in over the past year.

Yeah. Good afternoon, everyone. Um, in regards to the buyout offer while I know the company can't make any comments, specifically, I don't know if if it's possible for Bill to make any comments about why or his rationale for making the offer.

But we're still very active in the space and have a strong pipeline and we expect to continue to originate out of that business.

Yeah. Hey, it's Matt again. I'm sorry. We just we can't comment on anything beyond what we said on the call earlier about the

The offer that was made.

Okay. That's helpful. If we could.

According to national or just for a minute.

Thus far our platform.

Again, some additional acquisition there just wanted to talk a little bit about how that's coming along how that's growing.

Ultimate economics of that business will be.

Mike do you want to touch on that.

Fair enough. All right, no worries. Uh next question just around uh origination volume in the in the in the in the from the loan business. Uh again granted 2q was kind of a record but in 3Q you know, there there is a Slowdown just kind of curious disasters, anality is a lot more competition just kind of curious. What what was happening there.

Yeah, I'll pick that one up.

Obviously, we're a year into the <unk> we signed.

The venture with CPP IB.

In October last year I believe.

Yeah, good question. Yeah, so we know historically Q3 has been a bit slower and if you kind of look at the prior year as well, so Q3 tends to be just a little lower on the origination volumes, kind of coming out of the summer.

And so we had really good growth over that period, we're really pleased with that.

um,

and so, there certainly there's

With the number has as we've committed to and we're up and running with our leasing we've got almost 200 has is actually physically built and leased now.

Heightened competition—I think we talked about that on the last call—and we've seen some spreads coming in over the past year.

And what we're including the acquisitions that we that we reported today were up to I think it's about <unk>. We've got a great pipeline ahead of us.

Um, but we're still very active in the space and and have a, a strong Pipeline and we expect to continue to originate out of that business.

And a good appetite for doing more.

By the year end and Q4, we're expecting.

Several more acquisitions to complete.

We still see a good pipeline coming out of the house builders in the U K.

Okay. That's helpful. Um if you could go into national uh just for a minute the the sfr platform again some additional Acquisitions there, it's just going to talk a little bit about how that's coming along. How that's growing what ultimate economics of that business will be

Seeing this as a way to deliver additional stock.

Mike, do you want to touch on that?

And we have strong support from <unk> to grow the platform.

I would expect you'll see.

More acquisitions in Q4, and we look forward to continuing to grow into 2026 as well I think we've got some we've got some some good way to go on this.

Okay. That's helpful.

And then just kind of still stay in international just quick thoughts on the UK office.

Again, the occupancy decline just kind of talked a little bit about was that just an actual lease move out it wasn't a natural termination and as you look to kind of talk about the lease up of Coopers crossing as well.

Yes in terms of U K, we've had a couple of.

A couple of at least to me that that effect, we've been back filling the backfill haven't kicked in yet there are a number of cases, where we've actually signed agreements for lease that Havent Havent completed so I would expect that occupancy to go back up over the course of the next couple of quarters. In fact, we've got committed deals that can extend that occupancy back up again and beyond that we have a good <unk>.

Yeah, I'll pick that 1 up. Um, obviously, you know, we're a year into the Venture, are we signed the, um, the, the, the Venture with CBP, IB in October last year, I believe, uh, and so we've had really good growth over that period, you know, we're really pleased, uh, with the, with the, you know, with the number of houses, we've committed to, um, you know, we're up and running with our leasing, you know, we've got almost 200 houses actually, you know, physically built at least now. Uh, and you know, we're we're including the Acquisitions. That we that we reported today. We're up to, I think it's about 1300 homes. We've got a great pipeline ahead of us, um, and a good appetite for doing more. I think, you know, by the year end, uh, in Q4 we're expecting, you know, several more Acquisitions to to complete. Uh, we still see a good pipeline coming out of the house, builders in the UK, uh, who you're seeing this as a way.

Pipeline of leasing so I don't see a structural problem in our office leasing it's really a timing issue.

Way to deliver additional stock, um, and we have strong support from cppib to grow the platform. So I would expect you'll see, um, more Acquisitions in Q4, and we look forward to continuing to grow into 2026 as well. I think we've got some, we've got some some good way to go on this.

And the time taken to bring these buildings back into circulation. After after a couple of lease breaks, but actually we are re leasing at better rents in most cases and the demand has actually proved decent to the to the positive side. So I think on the on the U K.

Hey.

Office occupancy I would expect that to tick back up over the next few quarters.

Okay, that's helpful. Uh, and then just kind of still staying in international—just quick thoughts on the UK office again. The occupancy decline, uh, just kind of talk to a little bit about was that just an actual lease move-out or was it an actual termination? And if we could also kind of talk about the lease-up at Cooper's Crossing as well.

In terms of Coopers cross.

We have a good pipeline we are under offer to a.

Really interesting.

Tennant is looking to take.

Take some space and hopefully we can get that deal done in the next quarter and we've got a good pipeline of interest has clearly taken a little bit longer than we'd like but.

But that market is coming back to life and we see.

Better pipeline than we've seen in quite a while.

Great. Thank you very much.

Fluids, our question and answer session I would like to turn the conference back over to Bill Mcmorrow for any closing remarks.

Thank you everybody for joining the call today much appreciated.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

Yeah, in terms of UK, um, we've had a couple of, uh, a couple of at least move outs that affect. We've been back filling, but the back feels haven't kicked in yet. Uh, there are a number of cases where we've actually signed agreements for lease that haven't been that haven't completed so I would expect that occupancy to go back up over the course of the next couple of quarters. In fact, we've got committed deals that are going to send that occupancy back up again. Uh, and beyond that we have a good pipeline of leasing. So I don't see a structural problem in our in in our office leasing. It's really a timing issue uh, around the the you know, the time taken to, you know, to to bring these buildings back into C circulation after after a couple of lease breaks. But actually we're releasing it better rents in most cases and and and the demand has actually proved decent to the to, to the positive side. So, I think on the on, on the UK, um uh the office occupancy, I would expect that to take.

Back up over the next few quarters.

Um, in terms of Cooper's cross, um, we have a good pipeline. We, you know, we are under offer um, to a really interesting um, tenant who's looking to take. Um,

It takes some space and we hope we can get that deal done in the next quarter. Uh, and we've got a good pipeline of interest. It's clearly taken a little bit longer than we'd like, uh, but that market is coming back to life now. Uh, and we see a better pipeline than we've seen in quite a while.

Great, thank you very much.

Includes our question and answer session. I would like to turn the conference back over to Bill McMorrow for any closing remarks.

Thank you everybody for joining the call today, much appreciated.

The conference has now concluded, thank you for attending today's presentation. You may now disconnect