In the first quarter of 2026, it was generally good to be an apartment REIT that owned properties on the coasts.
For instance, West Coast apartment owner Essex Property Trust grew its core funds from operations per diluted share by 2.3% to $4.06 in the first quarter — exceeding the midpoint of the company’s guidance range by 11 cents.
That growth was primarily driven by higher occupancy and income, Barb Pak, Essex’s executive vice president and CFO, said during the company’s Q1 2026 earnings call on April 29. The company saw a 20-basis-point YOY occupancy gain, with strong performance in its Northern California market, she said.
In the Sun Belt, the supply overhang, coupled with some slowing demand, continues to be a headwind for REITs. However, executives expect the Sun Belt to improve as supply wanes, with demand holding up.
MAA, for example, is still contending with supply-driven pressure on new lease rates, particularly in high-growth markets. Still, the firm's executives noted conditions improved sequentially during the quarter, helped by continued strength in renewals.
“Renewal lease-over-lease growth improved 70 basis points, driving blended lease-over-lease growth up 140 basis points from the fourth quarter,” Tim Argo, executive vice president and chief strategy and analysis officer, said in the call.
Read on for more about how the apartment REITs performed in Q1.
