CAMDEN PROPERTY TRUST

Camden Property Trust is a Texas real estate investment trust primarily engaged in the ownership, management, development, reposition, redevelopment, acquisition, and construction of multifamily apartment communities. As of December 31, 2025, the company owned interests in, operated, or was developing 175 multifamily properties comprised of 59,921 apartment homes across the United States. The company focuses on investing in markets characterized by high-growth economic conditions, strong employment, and attractive quality of life, which it believes leads to higher demand and retention of its apartments. The company operates in a single reportable segment, as all operations are within the continental United States and no multifamily apartment community comprises more than 1.5% of consolidated revenues.

The filing does not name specific primary competitors or provide a stated market share. However, the company describes numerous housing alternatives that compete with its communities in attracting residents, including other multifamily properties, condominiums, single-family homes, and third-party providers of short-term rentals. The company believes it is well-positioned in its current markets and has the expertise to take advantage of new opportunities, and it relies heavily on its sophisticated property management capabilities and innovative operating strategies to maximize the earnings potential of its communities. The company also believes operating with a strong base of properties in its core markets provides an advantage due to economies of scale.

Camden Property Trust generates revenue primarily from real estate lease contracts, presented as property revenues, which include rental revenue under contractual terms for other services provided to residents. Other revenue streams include fee and asset management income from construction and development activities at third-party projects. The company's primary customer segments are residents of its multifamily apartment communities. The company's average lease terms are approximately fourteen months, and its individual property marketing plans are structured to respond to local market conditions.

The company's property revenues are derived from operating lease contracts for the use of dedicated spaces within owned assets. The company also earns revenues under contractual terms for other services considered non-lease components within a lease contract, primarily consisting of utility rebillings and other transactional fees. For the year ended December 31, 2025, total property revenues were $1,573,544,000 ¹. Fee and asset management income from construction and development activities at third-party projects was $12,967,000 ² for the year ended December 31, 2025. The company's stabilized operating properties had a weighted average occupancy rate of approximately 95% ³ for each of the years ended December 31, 2025 and 2024, and an average monthly rental rate per apartment home of $2,006 ⁴ and $1,997 ⁵ for the same periods, respectively.

The company's property expenses consist of property operating and maintenance expenses and real estate taxes. For the year ended December 31, 2025, total property expenses were $566,710,000 ⁶, comprising property operating and maintenance expenses of $369,889,000 ⁷ and real estate taxes of $196,821,000 ⁸. The company also incurs other expenses including property management expenses of $37,452,000 ⁹, general and administrative expenses of $79,344,000 ¹⁰, interest expense of $138,239,000 ¹¹, and depreciation and amortization expense of $611,025,000 ¹² for the year ended December 31, 2025.

In 2025, the company acquired four operating properties for approximately $422.9 million ¹³ and completed five dispositions for a total of approximately $374.5 million ¹⁴, recognizing a total gain of approximately $260.9 million ¹⁵. The company established a commercial paper program in February 2025, under which it may issue notes with an aggregate principal amount not to exceed $600.0 million ¹⁶. At December 31, 2025, the company had $590.0 million ¹⁷ principal amount of notes outstanding under the program. In 2025, the company repurchased 2,531,018 ¹⁸ common shares at an average price of $106.92 ¹⁹ per share for approximately $270.7 million ²⁰. In February 2026, the Board of Trust Managers authorized a new $600.0 million ²¹ share repurchase plan. The company also recorded an impairment charge of approximately $12.9 million ²² related to two undeveloped land parcels in the fourth quarter of 2025.

Net income attributable to common shareholders was $384.5 million ²³ for the year ended December 31, 2025, compared to $163.3 million ²⁴ for the year ended December 31, 2024. Total property revenues increased to $1,573,544,000 ²⁵ in 2025 from $1,543,842,000 ²⁶ in 2024. Net cash from operating activities was approximately $826.6 million ²⁷ for the year ended December 31, 2025, compared to approximately $774.9 million ²⁸ for the year ended December 31, 2024. Same store property revenues increased by approximately 0.8% ²⁹ for the year ended December 31, 2025 as compared to the same period in 2024.

The company intends to continue to seek opportunities to acquire operating communities, develop new communities, and to redevelop and reposition existing communities. In 2026, the company expects to incur costs between approximately $135 million ³⁰ and $155 million ³¹ related to the construction of three projects. Additionally, during 2026, the company expects to incur costs between approximately $50 million ³² and $60 million ³³ related to the start of new development activities. The company also intends to evaluate its operating property and land development portfolios and plans to continue its practice of selective dispositions and redeploying capital as market conditions warrant and opportunities arise.

The company expects to incur costs between approximately $77 million ³⁴ and $81 million ³⁵ related to repositions, redevelopment, repurposes, and revenue enhancing expenditures in 2026. The company also expects to incur between approximately $113 million ³⁶ and $117 million ³⁷ of additional recurring capital expenditures during 2026. The company's interest expense coverage ratio, net of capitalized interest, was approximately 6.6 ³⁸ and 6.9 ³⁹ times for the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025, the company estimated the remaining cost to complete the construction of three projects to be approximately $213.8 million ⁴⁰. Of this amount, the company expects to incur costs between approximately $135 million ⁴¹ and $155 million ⁴² during 2026 and to incur the remaining costs during 2027 and 2028. The company also expects to incur costs between approximately $50 million ⁴³ and $60 million ⁴⁴ related to the start of new development activities during 2026.

In 2025, the company repurchased 2,531,018 ⁴⁵ common shares at an average price of $106.92 ⁴⁶ per share for approximately $270.7 million ⁴⁷. In January 2026, the company repurchased 1,096,807 ⁴⁸ common shares at an average price of $110.03 ⁴⁹ per share for approximately $120.7 million ⁵⁰. In February 2026, the Board of Trust Managers authorized a new $600.0 million ⁵¹ share repurchase plan. The company declared a quarterly dividend of $1.05 ⁵² per common share in December 2025, equating to an annual dividend rate of $4.20 ⁵³ per share for the year ended December 31, 2025. In the first quarter of 2026, the Board declared a first quarter dividend of $1.06 ⁵⁴ per common share, and assuming similar distributions for the remainder of 2026, the annualized dividend rate for 2026 would be $4.24 ⁵⁵.

The company identifies several structural headwinds and execution risks. These include volatility in capital and credit markets, cost increases, or other unfavorable changes in economic conditions, either nationally or regionally in one or more of the markets in which it operates. The company also notes that short-term leases, with average terms of approximately fourteen months, could expose it to the effects of declining market rents. Additionally, the company faces risks associated with land holdings and related activities, as real estate markets are highly uncertain and the value of undeveloped land may fluctuate significantly. The company also highlights that changes in rent control or rent stabilization laws and regulations could adversely affect its operations and property values.

The company notes that rising interest rates could increase its borrowing costs, lower the value of its real estate, and decrease its share price. As of December 31, 2025, the company had an unsecured term loan with varying interest rates, an unsecured revolving credit facility, and a commercial paper program bearing interest at variable rates on all amounts drawn, as well as a senior unsecured note which has been converted into a floating rate instrument through an interest rate swap arrangement. If interest rates on the variable rate debt would have been 100 basis points higher throughout 2025, the company's annual interest costs would have increased by approximately $11.3 million ⁵⁶.

The company faces significant risks from volatility in capital and credit markets, which could impact its ability to obtain financing on acceptable terms and fully execute its growth strategy. As of December 31, 2025, the company had outstanding debt of approximately $3.9 billion ⁵⁷, which could increase its vulnerability to adverse economic conditions and limit its financial flexibility. The company is also exposed to risks associated with its development, reposition, redevelopment, and construction activities, with expected costs in 2026 between approximately $135 million ⁵⁸ and $155 million ⁵⁹ for three projects under construction. Changes in rent control or rent stabilization laws and regulations could adversely affect operations and property values, as certain states and local municipalities have adopted such laws. Additionally, the company's failure to qualify as a REIT could have adverse consequences, including being subject to federal and state income taxes and impairing its ability to expand its business and raise capital.

Management's message emphasizes a focus on producing consistent earnings growth through property operations, development and acquisitions, achieving market balance, and recycling capital. The company expects to maintain a strong balance sheet and preserve its financial flexibility by continuing to focus on core fundamentals, which currently are generating positive cash flows from operations, maintaining appropriate debt levels and leverage ratios, and controlling overhead costs. Management states that subject to market conditions, it intends to continue to seek opportunities to acquire operating communities, develop new communities, and to redevelop and reposition existing communities, and also intends to evaluate its operating property and land development portfolios and plan to continue its practice of selective dispositions and redeploying capital as market conditions warrant and opportunities arise. The company believes it is well-positioned with a strong balance sheet and sufficient liquidity to fund future acquisitions, new development, redevelopment, and other capital funding requirements.