With its first-quarter earnings release, UDR made news by announcing it was switching to monthly dividends — the first major apartment REIT to do so.

“Our thoughtful and thorough research focused on investors of the future pointed to an opportunity to expand our reach to grow a segment of capital, namely high net worth investors, family office and institutional products, who collectively value frequent cash distributions,” UDR CEO Tom Toomey said on the first quarter call on April 30.

In a research note shared with Multifamily Dive, Alexander Goldfarb, managing director and senior research analyst for investment bank and financial services company Piper Sandler, said that UDR’s roughly 5% dividend was higher than the 4.4% for the 10-year Treasury and roughly 4% for municipal bonds. 

“While we believe the dividend yield isn't high enough for retail, we do appreciate management's focus on the dividend, as this is the ultimate testament of value creation, assuming a flat to improving balance sheet,” Goldfarb wrote.

UDR’s dividend will ultimately be driven by operational strength, and in Q1, management seemed pleased with its financial performance despite lingering supply issues in the Sun Belt. The Highlands Ranch, Colorado-based REIT posted same-store revenue, expense and net operating income totals that beat estimates from Anthony Paolone, executive director at JPMorgan.

“We feel good about 2026 thus far, but we have only completed the first four months of the year,” Toomey said. “Accordingly, we are maintaining our full-year 2026 same-store and earnings guidance, which we will reassess next quarter.”

Here’s a look at UDR’s regional performance.

Top performers

San Francisco and New York led the way for UDR, with same-store revenue growth of 6.3% and 4.1%, respectively. In New York, UDR saw blended lease rate growth of approximately 7%, and occupancy above 98%, but the REIT’s top metro was on the West Coast.

“San Francisco is a standout market with the strongest revenue growth across our portfolio, driven by blended lease rate growth of approximately 10% and occupancy in the high 97% range,” Chief Operating Officer Mike Lacy said on the call.

In response to analyst concerns about job losses in San Francisco due to artificial intelligence, Lacy pointed to very low supply and return-to-office mandates that are helping landlords in the city.

“We continue to see a lot of momentum, not only just on the traffic side, but also on our market rents, which leads to renewal growth as well,” Lacy said. “In addition, that city is vibrant. We're seeing bars and restaurants start to open back up.”

While strength in New York City and San Francisco has been a theme of REIT earnings calls, Lacy sees potential in other metros across the country. In Dallas, the REIT posted occupancy approaching 97% and blended lease rate growth turned positive, up 570 basis points since Q4, according to Lacy. “Dallas continues to show the best momentum among our Sun Belt markets,” he said.

Lacy also noted positive momentum in Philadelphia and Southern California, particularly in Orange County. “Our overweight exposure to these markets uniquely positions us to capture upside should these trends continue,” he said.

Sun Belt struggles

The Sun Belt markets were the worst-performing metros in Q1 for UDR. Austin, Texas; Nashville, Tennessee; and Orlando, Florida, posted same-store YOY revenue growth of -5%, -2.3% and -1.8% in Q1, respectively.

UDR saw strong positive momentum in the Sun Belt from Q4 2025 through Q1. But then things slowed over the past 30 days, with blended rents dropping from -1.5% in Q1 to -2.5% in April, Lacy said on the call.

“You do have to negotiate a little bit more on your renewals,” Lacy said. “And so we were pretty aggressive with our renewals, as you can see, with what we signed. I think we had to retreat a little bit in some of those Sun Belt markets.”

But Lacy doesn’t see long-term issues. “What we're experiencing right now is, I think, more of a blip, if you will, because we do still expect that we could see more of an inflection in the Sun Belt this year at some point,” Lacy said.

He sees UDR continuing to work through supply as the year progresses. “We could see market rents start to move back up throughout the summer, and that could help us continue to try to drive those markets as we go forward,” Lacy said.

Opportunistic markets

With a rent control initiative on the ballot in Massachusetts this November, the REIT has joined with local apartment groups and contributed roughly $500,000 to defeat the measure and could spend more, UDR Senior Vice President of Investment Strategy Christopher Van Ens said on the call.

“This is nothing compared to what was spent in California on the ballot initiatives,” Van Ens said. “Massachusetts, obviously, is a much smaller market, so we feel that from a cost perspective, from a funded perspective, it will be a relatively smaller fraction than what we saw in California.” 

The possibility of rent control has essentially slowed the sales market in Massachusetts, which makes it harder to determine cap rates and prices in the state, Lacy said. However, UDR is still open to buying, with some of the markets in the state screening well in the REIT’s analytics system, Toomey said.

“I think with our team and our insight with respect to how this is progressing, I wouldn't take it off the map,” Toomey said

UDR is also looking at opportunities in another regulated market — Portland, Oregon. Currently, the REIT has 220 wholly owned apartments in the market and 256 owned through a joint venture, according to its earnings release.

In April, UDR used its debt and preferred equity program to gain access to a 232-unit apartment community in Portland, and it plans to take over another in the coming months. With 2026 deliveries at only 0.7% of the stock, the company likes the market dynamics, Van Ens said. 

“Portland does look right now like one of our better markets from a demand-supply perspective,” Van Ens said. “I would tell you, 2026 job forecasts for the market have doubled since the beginning of the year. Wage growth acceleration is actually the best within our market footprint right now.”

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