After selling its entire California portfolio to pay for new investments in the Sun Belt, Camden Property Trust posted marginally positive results in the second quarter of 2026, according to its second-quarter 2026 earnings report.
The Houston-based REIT beat its own expectations in revenues and net operating income during the quarter, said Benjamin Fraker, Camden’s executive vice president and CFO, during a July 31 earnings call. Camden’s earnings per share stood at $0.18 at the end of Q2, up slightly from its guidance of $0.15 EPS but significantly less than the $0.74 EPS it posted a year ago.
Earlier this year, Camden announced plans to sell its 11 California properties for $1.6 billion and reallocate those proceeds to improve its market concentration in the Sun Belt markets, said Ric Campo, executive chairman of Camden’s board. The company planned to use those new funds to acquire $1 billion worth of new properties within its existing markets and buy back its shares.
The move allowed the company to redeploy capital into higher-growth markets and Camden shares, while maximizing tax efficiency, said Fraker during the call. The existing Sun Belt markets had stronger population growth, employment growth, migration, household formation and long-term multifamily demand.
Over the quarter, the company sold its California properties at amounts that were in line with its expectations and wound down its operations in the state, CEO Alexander Jessett said during the call.
“The execution has been nearly flawless, with only $200 million of acquisition properties left to identify,” Campo said.
BY THE NUMBERS
| Category | Q2 | YOY Change |
| Property revenue | $329.1 million | -0.1% |
| Net operating income | $207.4 million | -1.4% |
| Operating expenses | $121.7 million | 2.4% |
| Core funds from operations | $1.68 | -1.2% |
| Occupancy rate | 95.7% | 10 bps |
SOURCE: Camden
Forging ahead in the Sun Belt
Over the last three decades, Sun Belt cities have led the U.S. in population growth, employment growth and domestic in-migration, according to Campo.
“We believe these trends will continue to make the Sun Belt an attractive place in which Camden’s residents can live, work and play,” he said.
The “strategic market rebalancing” maneuver is FFO-neutral in year one and is anticipated to soon be accretive, as the REIT is projecting that the new Sun Belt properties will grow faster than those at the California properties it had sold, said Jessett.
The company will also “no longer be subject to high levels of regulatory and advocacy spend in California,” Jessett added. Without the sale, that spend would have reduced the annual NOI for its portfolio in the state by about 80 basis points, he said.
With the California sale, Camden has so far closed on seven apartment home communities for a total $645 million this year. Collectively, those communities added 2,061 homes to the company’s portfolio in Alpharetta, Georgia; Orlando and Tampa, Florida; Franklin, Tennessee; Roanoke, Texas; Gilbert, Arizona; and Charlotte, North Carolina.
The REIT also purchased two land parcels in Tampa and Morrisville, North Carolina, at $45 million combined.
Year to date, Camden has repurchased $422.9 million worth of shares, with another $297.9 million remaining under its stock repurchase program. About $900 million were also used to retire balances that were outstanding under the company’s unsecured revolving credit facility and commercial paper program.
Positioned for Q3
Effective new lease rates in Q2, excluding California properties, fell 3.3%, compared to negative 2.1% in Q2 2025. At 2.8% in Q2, renewal rates were less than the rates of 3.7% one year prior. In total, effective blended lease rates fell 0.2% in Q2, lower than the 0.7% rate in Q2 2025.
“Our renewal rates were fairly steady for the first half of 2026, but began to improve during our summer leasing season,” said Chief Operating Officer Laurie Baker during the call. “Our sign[ed] renewal increase was 3.4% in June and over 4% in July, which positions us well for those leases becoming effective during the third quarter.”
Turnover rates across its portfolio also remained “very low” in Q2 at 39%, which was consistent with the net turnover rate in the second quarter of 2025 and “a testament to our strong resident retention and satisfaction,” Baker said.
“While we’re not declaring victory, we’re encouraged by what we’re seeing,” said Baker. “Our operating story in the second quarter is one of improvements, strong renewal execution and broad-based pricing recovery across the portfolio.”
In July, nearly half of the REIT’s communities had positive signed new leases, up from only 20% in March, said Jessett. That includes the majority of its communities in Atlanta, Charlotte, Dallas, Raleigh and Southeast Florida, and nearly half of its communities in Houston, Orlando, and Washington, D.C., he said.
Systemwide, signed new leases had been positive “a handful of days” in July, said Jessett, metrics he characterized as “a very green shoot.”
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