http://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://www.udr.com/20230331#ManagementAndOtherFeesMemberhttp://fasb.org/us-gaap/2022#OtherAssetshttp://fasb.org/us-gaap/2022#OtherAssetsP3M0000074208false2023Q1--12-310000074208us-gaap:CommonStockMember2023-01-012023-03-310000074208us-gaap:AdditionalPaidInCapitalMember2023-01-012023-03-310000074208us-gaap:CommonStockMember2022-01-012022-03-310000074208us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310000074208us-gaap:PreferredStockMember2023-03-310000074208us-gaap:NoncontrollingInterestMember2023-03-310000074208us-gaap:CommonStockMember2023-03-310000074208us-gaap:AdditionalPaidInCapitalMember2023-03-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2023-03-310000074208us-gaap:PreferredStockMember2022-12-310000074208us-gaap:NoncontrollingInterestMember2022-12-310000074208us-gaap:CommonStockMember2022-12-310000074208us-gaap:AdditionalPaidInCapitalMember2022-12-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-12-310000074208us-gaap:PreferredStockMember2022-03-310000074208us-gaap:NoncontrollingInterestMember2022-03-310000074208us-gaap:CommonStockMember2022-03-310000074208us-gaap:AdditionalPaidInCapitalMember2022-03-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-03-310000074208us-gaap:PreferredStockMember2021-12-310000074208us-gaap:NoncontrollingInterestMember2021-12-310000074208us-gaap:CommonStockMember2021-12-310000074208us-gaap:AdditionalPaidInCapitalMember2021-12-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2021-12-310000074208us-gaap:CommercialPaperMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208us-gaap:CommercialPaperMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2022-01-012022-12-310000074208us-gaap:CommercialPaperMember2023-01-012023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMember2023-01-012023-03-310000074208us-gaap:DisposalGroupDisposedOfBySaleNotDiscontinuedOperationsMemberudr:RetailComponentOfDevelopmentCommunityLocatedInWashingtonD.c.Member2023-01-012023-01-310000074208us-gaap:SeriesFPreferredStockMember2023-03-310000074208us-gaap:SeriesEPreferredStockMember2023-03-310000074208us-gaap:SeriesFPreferredStockMember2022-12-310000074208us-gaap:SeriesEPreferredStockMember2022-12-310000074208us-gaap:SeriesEPreferredStockMember2022-01-012022-03-310000074208us-gaap:SeriesEPreferredStockMember2023-01-012023-03-310000074208us-gaap:SeriesEPreferredStockMember2022-01-012022-12-310000074208udr:UDRLighthouseDownREITL.P.Member2023-03-310000074208us-gaap:NoncontrollingInterestMember2023-01-012023-03-310000074208us-gaap:NoncontrollingInterestMember2022-01-012022-03-310000074208us-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestExpenseMember2023-01-012023-03-310000074208us-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMemberus-gaap:InterestExpenseMember2022-01-012022-03-310000074208us-gaap:LandMember2023-01-012023-03-310000074208us-gaap:LandMember2022-01-012022-03-310000074208us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2023-02-280000074208srt:MaximumMember2022-01-012022-03-310000074208udr:OthersMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:OthersMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:SecuredDebtMember2022-12-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:RevolvingCreditFacilityMember2023-03-310000074208udr:TermLoanFacilityDueJanuary2027Member2023-03-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:RevolvingCreditFacilityMember2022-12-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:RevolvingCreditFacilityMember2023-01-012023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2022-01-012022-12-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-12-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:LetterOfCreditMember2023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:LetterOfCreditMember2022-12-310000074208udr:RetailAndCommercialSpaceMember2023-01-012023-03-310000074208udr:ApartmentHomesMember2023-01-012023-03-310000074208srt:MinimumMemberudr:RetailAndCommercialSpaceMember2023-03-310000074208srt:MaximumMemberudr:RetailAndCommercialSpaceMember2023-03-310000074208srt:MaximumMemberudr:ApartmentHomesMember2023-03-310000074208us-gaap:OtherOperatingIncomeExpenseMemberus-gaap:LandMember2023-01-012023-03-310000074208us-gaap:OtherOperatingIncomeExpenseMemberus-gaap:LandMember2022-01-012022-03-310000074208us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:EquitySecuritiesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:EquitySecuritiesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:EquitySecuritiesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:EquitySecuritiesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:EquitySecuritiesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208srt:MaximumMemberus-gaap:DisposalGroupDisposedOfBySaleNotDiscontinuedOperationsMemberudr:RetailComponentOfDevelopmentCommunityLocatedInWashingtonD.c.Member2023-01-012023-01-310000074208udr:HomeCommunityRiversideCaliforniaMemberudr:NoteDueDecember2026Member2022-12-310000074208udr:HomeCommunityMenifeeCaliforniaMemberudr:NoteDueDecember2026OneMember2022-12-310000074208udr:NoteDueJune2027Member2022-12-310000074208udr:NoteDueDecember2023Member2022-12-310000074208udr:MarketPropertiesLlcThirteenthMemberus-gaap:AccountsPayableAndAccruedLiabilitiesMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsAndRealEstateTechnologyInvestmentsMember2023-03-310000074208udr:OperatingCommunityMemberudr:PreferredEquityInvestmentsMember2022-12-310000074208udr:MarketPropertiesLlcThirteenthMemberus-gaap:AccountsPayableAndAccruedLiabilitiesMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvStrategicFundMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIiMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetEsgMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsMember2022-12-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsAndRealEstateTechnologyInvestmentsMember2022-12-310000074208udr:PreferredEquityInvestmentsMember2022-12-310000074208udr:UnconsolidatedJointVentureUdrMetLifeMember2023-03-310000074208udr:UnconsolidatedJointVentureUdrMetLifeMember2022-12-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2023-01-012023-03-310000074208us-gaap:AccumulatedDistributionsInExcessOfNetIncomeMember2022-01-012022-03-310000074208us-gaap:LandBuildingsAndImprovementsMember2023-03-310000074208udr:BuildingImprovementsFurnitureFixturesAndEquipmentMember2023-03-310000074208us-gaap:LandBuildingsAndImprovementsMember2022-12-310000074208udr:BuildingImprovementsFurnitureFixturesAndEquipmentMember2022-12-310000074208udr:TermLoanFacilityDueJuly2025Memberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:InterestRateSwapAndCapsMemberus-gaap:DesignatedAsHedgingInstrumentMember2023-03-310000074208us-gaap:NondesignatedMember2023-03-310000074208us-gaap:InterestRateContractMemberus-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:OtherAssetsMemberus-gaap:InterestRateContractMemberus-gaap:DesignatedAsHedgingInstrumentMember2023-03-310000074208us-gaap:InterestRateContractMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:InterestRateContractMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:InterestRateContractMemberus-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:OtherAssetsMemberus-gaap:InterestRateContractMemberus-gaap:DesignatedAsHedgingInstrumentMember2022-12-310000074208us-gaap:InterestRateContractMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:InterestRateContractMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208udr:ThreePointOneZeroPercentSeniorUnsecuredNotesDue2034Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:DerivativeScenarioTwoMemberudr:TermLoanFacilityDueJuly2025Memberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:DerivativeScenarioThreeMemberudr:TermLoanFacilityDueJuly2025Memberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:DerivativeScenarioOneMemberudr:TermLoanFacilityDueJuly2025Memberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:TotalJointVenturesAndPartnershipsMember2023-01-012023-03-310000074208udr:TotalJointVenturesAndPartnershipsMember2022-01-012022-03-310000074208us-gaap:UnsecuredDebtMember2022-12-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberudr:DebtAssumedAsPartOfAcquisitionMember2023-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberudr:DebtAssumedAsPartOfAcquisitionMember2022-12-310000074208udr:TwoPointOneZeroPercentMediumTermNoteDueAugust12032Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208srt:WeightedAverageMemberus-gaap:MortgagesMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberus-gaap:CommercialPaperMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:UnsecuredRevolvingCreditFacilityDueJanuary2026Memberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:TwoPointOneZeroPercentMediumTermNoteDueAugust12032Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:TermLoanFacilityDueJanuary2027Memberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:TermLoanFacilityDueJanuary2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:TaxExemptNotesPayableMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:SeniorUnsecuredMediumTermNotes3.2PercentDueJanuary2030Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:SeniorUnsecuredMediumTerm2.10PercentNoteDue2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:MediumTerm3.10PercentageNoteDueNovember2034Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:MediumTerm3.00PercentageNoteDueAugust2031Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:MediumTerm1.90PercentageNoteDueMarch2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:FourPointFourZeroPercentMediumTermNoteDueJanuaryTwoThousandTwentyNineMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:EightPointFiveZeroPercentDebenturesDueSeptember2024Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:A3.50MediumTermNotesDueJanuary2028Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:A3.50MediumTermNoteDueJuly2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberudr:A2.95MediumTermNoteDueSeptember2026Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMemberus-gaap:SecuredDebtMember2023-01-012023-03-310000074208srt:WeightedAverageMember2023-01-012023-03-310000074208udr:TwoPointOneZeroPercentMediumTermNoteDueAugust12032Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:SeniorUnsecuredMediumTermNotes3.2PercentDueJanuary2030Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:SeniorUnsecuredMediumTerm2.10PercentNoteDue2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:MediumTerm3.10PercentageNoteDueNovember2034Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:MediumTerm3.00PercentageNoteDueAugust2031Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:MediumTerm1.90PercentageNoteDueMarch2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:A3.50MediumTermNotesDueJanuary2028Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:SeniorUnsecuredMediumTermNotes3.2PercentDueJanuary2030Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:SeniorUnsecuredMediumTerm2.10PercentNoteDue2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:MediumTerm3.10PercentageNoteDueNovember2034Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:MediumTerm3.00PercentageNoteDueAugust2031Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:MediumTerm1.90PercentageNoteDueMarch2033Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:FourPointFourZeroPercentMediumTermNoteDueJanuaryTwoThousandTwentyNineMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:A3.50MediumTermNotesDueJanuary2028Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:A3.50MediumTermNoteDueJuly2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:MortgagesMemberudr:VariableRateDebtMemberudr:TaxExemptSecuredNotesPayableMember2023-03-310000074208srt:MinimumMemberus-gaap:MortgagesMemberudr:FixedRateDebtMember2023-03-310000074208srt:MaximumMemberus-gaap:MortgagesMemberudr:FixedRateDebtMember2023-03-310000074208us-gaap:MortgagesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208us-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208us-gaap:MortgagesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:CommercialPaperMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:CommercialPaperMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:MortgagesMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208us-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208us-gaap:MortgagesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208udr:TaxExemptSecuredNotesPayableMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:CommercialPaperMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:CommercialPaperMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:UnsecuredDebtMember2022-12-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208udr:TermLoanFacilityDueJanuary2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:TaxExemptNotesPayableMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208udr:EightPointFiveZeroPercentDebenturesDueSeptember2024Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:MediumTerm3.00PercentageNoteDueAugust2031Member2023-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208udr:TermLoanFacilityDueJanuary2027Memberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:TermLoanFacilityDueJanuary2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:TaxExemptNotesPayableMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2022-12-310000074208udr:EightPointFiveZeroPercentDebenturesDueSeptember2024Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208udr:A2.95MediumTermNoteDueSeptember2026Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-310000074208srt:MinimumMemberudr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:MaximumMemberudr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208udr:UnsecuredWorkingCapitalCreditFacilityMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:MinimumMemberudr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:MinimumMemberudr:TermLoanFacilityDueSeptember2023Memberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:MaximumMemberudr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208srt:MaximumMemberudr:TermLoanFacilityDueSeptember2023Memberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208udr:UnsecuredRevolvingCreditFacilityDueTwoThousandTwentyThreeMemberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208udr:TermLoanFacilityDueSeptember2023Memberus-gaap:UnsecuredDebtMember2023-01-012023-03-310000074208udr:AtMarketOfferingMember2021-07-310000074208udr:AtMarketOfferingMember2023-03-3100000742082022-03-3100000742082021-12-310000074208us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2023-03-310000074208us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310000074208us-gaap:EquityUnitPurchaseAgreementsMember2023-01-012023-03-310000074208us-gaap:ConvertiblePreferredStockMember2023-01-012023-03-310000074208udr:StockCompensationPlanAndUnvestedRestrictedStockMember2023-01-012023-03-310000074208us-gaap:EquityUnitPurchaseAgreementsMember2022-01-012022-03-310000074208us-gaap:ConvertiblePreferredStockMember2022-01-012022-03-310000074208udr:StockCompensationPlanAndUnvestedRestrictedStockMember2022-01-012022-03-310000074208us-gaap:InterestExpenseMember2023-01-012023-03-310000074208us-gaap:InterestExpenseMember2022-01-012022-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberudr:DebtAssumedAsPartOfAcquisitionMember2023-01-012023-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberudr:DebtAssumedAsPartOfAcquisitionMember2022-01-012022-03-310000074208us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-03-310000074208us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-03-310000074208udr:TotalJointVenturesAndPartnershipsMember2023-03-310000074208udr:TotalJointVenturesAndPartnershipsMember2022-12-310000074208us-gaap:MortgagesMemberudr:VariableRateDebtMemberudr:TaxExemptNotesPayableMember2023-03-310000074208udr:FourPointFourZeroPercentMediumTermNoteDueJanuaryTwoThousandTwentyNineMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2020-07-310000074208udr:TaxableReitSubsidiariesMember2023-01-012023-03-310000074208udr:SameCommunitiesWesternRegionMember2023-03-310000074208udr:SameCommunitiesSouthwesternRegionMember2023-03-310000074208udr:SameCommunitiesSoutheasternRegionMember2023-03-310000074208udr:SameCommunitiesNortheastRegionMember2023-03-310000074208udr:SameCommunitiesMidAtlanticRegionMember2023-03-310000074208udr:NonMatureCommunitiesOtherMember2023-03-310000074208udr:SameCommunitiesWesternRegionMember2022-12-310000074208udr:SameCommunitiesSouthwesternRegionMember2022-12-310000074208udr:SameCommunitiesSoutheasternRegionMember2022-12-310000074208udr:SameCommunitiesNortheastRegionMember2022-12-310000074208udr:SameCommunitiesMidAtlanticRegionMember2022-12-310000074208udr:NonMatureCommunitiesOtherMember2022-12-310000074208udr:FourPointFourZeroPercentMediumTermNoteDueJanuaryTwoThousandTwentyNineMemberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:A3.50MediumTermNoteDueJuly2027Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208udr:A2.95MediumTermNoteDueSeptember2026Memberudr:FixedRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208srt:MinimumMember2023-01-012023-03-310000074208srt:MaximumMember2023-01-012023-03-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-03-310000074208us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000074208udr:TotalCommunitiesMember2023-01-012023-03-310000074208udr:SameCommunitiesWesternRegionMember2023-01-012023-03-310000074208udr:SameCommunitiesSouthwesternRegionMember2023-01-012023-03-310000074208udr:SameCommunitiesSoutheasternRegionMember2023-01-012023-03-310000074208udr:SameCommunitiesNortheastRegionMember2023-01-012023-03-310000074208udr:SameCommunitiesMidAtlanticRegionMember2023-01-012023-03-310000074208udr:NonMatureCommunitiesOtherMember2023-01-012023-03-310000074208udr:TotalCommunitiesMember2022-01-012022-03-310000074208udr:SameCommunitiesWesternRegionMember2022-01-012022-03-310000074208udr:SameCommunitiesSouthwesternRegionMember2022-01-012022-03-310000074208udr:SameCommunitiesSoutheasternRegionMember2022-01-012022-03-310000074208udr:SameCommunitiesNortheastRegionMember2022-01-012022-03-310000074208udr:SameCommunitiesMidAtlanticRegionMember2022-01-012022-03-310000074208udr:NonMatureCommunitiesOtherMember2022-01-012022-03-310000074208us-gaap:MortgagesMemberudr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-01-012023-03-310000074208udr:TaxExemptNotesPayableMemberudr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-01-012023-03-310000074208us-gaap:SecuredDebtMember2023-01-012023-03-310000074208udr:HqMember2023-01-012023-03-310000074208udr:HomeCommunityMenifeeCaliforniaMemberudr:NoteDueDecember2026OneMember2023-03-310000074208us-gaap:NoncontrollingInterestMember2022-01-012022-03-310000074208us-gaap:RevolvingCreditFacilityMember2023-03-310000074208udr:NonAffiliatedPartnersMemberudr:UDRLighthouseDownREITL.P.Member2023-03-310000074208udr:NonAffiliatedPartnersMember2023-03-310000074208udr:RetailAndCommercialSpaceMember2023-03-310000074208us-gaap:LandMember2023-03-310000074208udr:RetailTenantLeaseMember2023-03-310000074208udr:MultifamilyTenantLeaseMember2023-03-310000074208udr:HomeCommunityRiversideCaliforniaMemberudr:NoteDueDecember2026Member2023-01-012023-03-310000074208udr:HomeCommunityMenifeeCaliforniaMemberudr:NoteDueDecember2026Member2023-01-012023-03-310000074208udr:OperatingCommunityMemberudr:PreferredEquityInvestmentsMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvStrategicFundMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIiMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetEsgMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsAndRealEstateTechnologyInvestmentsMember2023-01-012023-03-310000074208udr:UnconsolidatedJointVentureUdrMetLifeMember2023-01-012023-03-310000074208udr:PreferredEquityInvestmentsMember2023-01-012023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2022-07-012022-09-300000074208udr:OperatingCommunityMemberudr:PreferredEquityInvestmentsMember2022-01-012022-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2022-01-012022-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIiMember2022-01-012022-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsMember2022-01-012022-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsAndRealEstateTechnologyInvestmentsMember2022-01-012022-03-310000074208udr:UnconsolidatedJointVentureUdrMetLifeMember2022-01-012022-03-310000074208udr:PreferredEquityInvestmentsMember2022-01-012022-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2021-07-012021-09-300000074208udr:UnitedDominionRealityLPMember2023-03-310000074208udr:UdrIncMember2023-03-310000074208us-gaap:RevolvingCreditFacilityMember2023-01-012023-03-310000074208udr:OperatingCommunityMemberudr:PreferredEquityInvestmentsMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvStrategicFundMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIiMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetvIiiMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:RealEstateTechnologyInvestmentsRetEsgMember2023-03-310000074208udr:DevelopmentCommunityMemberudr:PreferredEquityInvestmentsMember2023-03-310000074208udr:PreferredEquityInvestmentsMember2023-03-310000074208udr:VariableRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208udr:FixedRateDebtMemberus-gaap:SecuredDebtMember2023-03-310000074208us-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:SecuredDebtMember2023-03-310000074208udr:TermLoanFacilityDueSeptember2023Memberus-gaap:UnsecuredDebtMember2022-01-012022-09-300000074208udr:WhollyOwnedPropertiesUnderDevelopmentMember2023-03-310000074208udr:WhollyOwnedPropertiesRedevelopmentMember2023-03-310000074208udr:RealEstateTechnologyInvestmentsMember2023-03-310000074208us-gaap:CommercialPaperMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2023-03-310000074208us-gaap:CommercialPaperMemberudr:VariableRateDebtMemberus-gaap:UnsecuredDebtMember2022-12-3100000742082022-01-012022-03-310000074208udr:NoteDueDecember2023Member2023-01-012023-03-310000074208udr:NoteDueJune2027Member2023-03-310000074208udr:HomeCommunityRiversideCaliforniaMemberudr:NoteDueDecember2026Member2023-03-310000074208udr:HomeCommunityMenifeeCaliforniaMemberudr:NoteDueDecember2026Member2023-03-3100000742082023-03-3100000742082022-12-310000074208udr:NoteDueDecember2023Member2023-03-3100000742082023-04-2400000742082023-01-012023-03-31udr:propertyudr:segmentudr:statexbrli:sharesiso4217:USDxbrli:pureudr:homeudr:itemudr:communityudr:loaniso4217:USDxbrli:sharesudr:instrument

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                    

Commission file number

1-10524

UDR, Inc.

(Exact name of registrant as specified in its charter)

Maryland

54-0857512

(State or other jurisdiction of

(I.R.S. Employer

incorporation of organization)

Identification No.)

1745 Shea Center Drive, Suite 200, Highlands Ranch, Colorado 80129

(Address of principal executive offices) (zip code)

(720283-6120

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01

UDR

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated Filer

Non-Accelerated Filer

Smaller Reporting Company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

The number of shares of UDR, Inc.’s common stock, $0.01 par value, outstanding as of April 24, 2023 was 329,172,797.

Table of Contents

UDR, INC.

INDEX

PAGE

PART I — FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Consolidated Balance Sheets as of March 31, 2023 (unaudited) and December 31, 2022 (audited)

3

Consolidated Statements of Operations for the three months ended March 31, 2023 and 2022 (unaudited)

4

Consolidated Statements of Comprehensive Income/(Loss) for the three months ended March 31, 2023 and 2022 (unaudited)

5

Consolidated Statements of Changes in Equity for the three months ended March 31, 2023 and 2022 (unaudited)

6

Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 (unaudited)

7

Notes to Consolidated Financial Statements (unaudited)

8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

35

Item 3. Quantitative and Qualitative Disclosures About Market Risk

50

Item 4. Controls and Procedures

50

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

51

Item 1A. Risk Factors

51

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

67

Item 3. Defaults Upon Senior Securities

68

Item 4. Mine Safety Disclosures

68

Item 5. Other Information

68

Item 6. Exhibits

69

Signatures

70

Exhibit 31.1

Exhibit 31.2

Exhibit 32.1

Exhibit 32.2

Table of Contents

UDR, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

March 31, 

December 31, 

    

2023

    

2022

(unaudited)

(audited)

ASSETS

Real estate owned:

 

  

 

  

Real estate held for investment

$

15,565,915

$

15,365,928

Less: accumulated depreciation

 

(5,926,651)

 

(5,762,205)

Real estate held for investment, net

 

9,639,264

 

9,603,723

Real estate under development (net of accumulated depreciation of $0 and $296, respectively)

 

76,455

 

189,809

Real estate held for disposition (net of accumulated depreciation of $0 and $0, respectively)

 

 

14,039

Total real estate owned, net of accumulated depreciation

 

9,715,719

 

9,807,571

Cash and cash equivalents

 

1,172

 

1,193

Restricted cash

 

28,038

 

29,001

Notes receivable, net

 

71,125

 

54,707

Investment in and advances to unconsolidated joint ventures, net

 

751,387

 

754,446

Operating lease right-of-use assets

193,230

194,081

Other assets

 

207,029

 

197,471

Total assets

$

10,967,700

$

11,038,470

LIABILITIES AND EQUITY

 

  

 

  

Liabilities:

 

  

 

  

Secured debt, net

$

1,051,000

$

1,052,281

Unsecured debt, net

 

4,525,963

 

4,435,022

Operating lease liabilities

188,402

189,238

Real estate taxes payable

 

35,052

 

37,681

Accrued interest payable

 

26,580

 

46,671

Security deposits and prepaid rent

 

57,738

 

51,999

Distributions payable

 

148,409

 

134,213

Accounts payable, accrued expenses, and other liabilities

 

111,795

 

153,220

Total liabilities

 

6,144,939

 

6,100,325

Commitments and contingencies (Note 13)

 

  

 

  

Redeemable noncontrolling interests in the Operating Partnership and DownREIT Partnership

 

901,652

 

839,850

Equity:

 

  

 

  

Preferred stock, no par value; 50,000,000 shares authorized at March 31, 2023 and December 31, 2022:

 

  

 

  

8.00% Series E Cumulative Convertible; 2,686,308 and 2,686,308 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively

 

44,614

 

44,614

Series F; 12,090,558 and 12,100,514 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively

 

1

 

1

Common stock, $0.01 par value; 450,000,000 shares authorized at March 31, 2023 and December 31, 2022:

 

  

 

  

329,173,125 and 328,993,088 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively

 

3,292

 

3,290

Additional paid-in capital

 

7,494,042

 

7,493,423

Distributions in excess of net income

 

(3,627,873)

 

(3,451,587)

Accumulated other comprehensive income/(loss), net

 

6,823

 

8,344

Total stockholders’ equity

 

3,920,899

 

4,098,085

Noncontrolling interests

 

210

 

210

Total equity

 

3,921,109

 

4,098,295

Total liabilities and equity

$

10,967,700

$

11,038,470

See accompanying notes to consolidated financial statements.

3

Table of Contents

UDR, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

Three Months Ended

March 31, 

2023

2022

REVENUES:

    

  

    

  

Rental income

$

398,307

$

356,181

Joint venture management and other fees

 

1,242

 

1,085

Total revenues

 

399,549

 

357,266

OPERATING EXPENSES:

 

  

 

  

Property operating and maintenance

 

64,834

 

58,484

Real estate taxes and insurance

 

57,970

 

53,764

Property management

 

12,945

 

11,576

Other operating expenses

 

3,032

 

4,712

Real estate depreciation and amortization

 

169,300

 

163,622

General and administrative

 

17,480

 

14,908

Casualty-related charges/(recoveries), net

 

4,156

 

(765)

Other depreciation and amortization

 

3,649

 

3,075

Total operating expenses

333,366

 

309,376

Gain/(loss) on sale of real estate owned

1

Operating income

 

66,184

 

47,890

Income/(loss) from unconsolidated entities

 

9,707

 

5,412

Interest expense

 

(43,742)

 

(35,916)

Interest income and other income/(expense), net

 

1,010

 

(2,440)

Income/(loss) before income taxes

 

33,159

 

14,946

Tax (provision)/benefit, net

 

(234)

 

(343)

Net income/(loss)

 

32,925

 

14,603

Net (income)/loss attributable to redeemable noncontrolling interests in the Operating Partnership and DownREIT Partnership

 

(1,953)

 

(879)

Net (income)/loss attributable to noncontrolling interests

 

(8)

 

(19)

Net income/(loss) attributable to UDR, Inc.

 

30,964

 

13,705

Distributions to preferred stockholders — Series E (Convertible)

 

(1,183)

 

(1,092)

Net income/(loss) attributable to common stockholders

$

29,781

$

12,613

Income/(loss) per weighted average common share:

 

  

 

  

Basic

$

0.09

$

0.04

Diluted

$

0.09

$

0.04

Weighted average number of common shares outstanding:

 

  

 

  

Basic

 

328,789

 

318,009

Diluted

 

329,421

 

319,680

See accompanying notes to consolidated financial statements.

4

Table of Contents

UDR, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)

(In thousands)

(Unaudited)

Three Months Ended

March 31, 

2023

2022

Net income/(loss)

$

32,925

$

14,603

Other comprehensive income/(loss), including portion attributable to noncontrolling interests:

 

  

 

  

Other comprehensive income/(loss) - derivative instruments:

 

  

 

  

Unrealized holding gain/(loss)

 

(273)

 

7,193

(Gain)/loss reclassified into earnings from other comprehensive income/(loss)

 

(1,369)

 

387

Other comprehensive income/(loss), including portion attributable to noncontrolling interests

 

(1,642)

 

7,580

Comprehensive income/(loss)

 

31,283

 

22,183

Comprehensive (income)/loss attributable to noncontrolling interests

 

(1,840)

 

(1,412)

Comprehensive income/(loss) attributable to UDR, Inc.

$

29,443

$

20,771

See accompanying notes to consolidated financial statements.

5

Table of Contents

UDR, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(In thousands, except per share data)

(Unaudited)

    

    

    

    

Distributions

Accumulated Other Comprehensive

Preferred

Common

Paid-in

in Excess of

Income/(Loss),

Noncontrolling

Stock

Stock

Capital

Net Income

net

Interests

Total

Balance at December 31, 2022

44,615

3,290

7,493,423

(3,451,587)

8,344

210

4,098,295

Net income/(loss) attributable to UDR, Inc.

30,964

30,964

Other comprehensive income/(loss)

(1,521)

(1,521)

Issuance/(forfeiture) of common and restricted shares, net

2

695

697

Issuance of common shares through public offering, net

(462)

(462)

Adjustment for conversion of noncontrolling interest of unitholders in the Operating Partnership and DownREIT Partnership

386

386

Common stock distributions declared ($0.42 per share)

(138,318)

(138,318)

Preferred stock distributions declared-Series E ($0.4548 per share)

(1,183)

(1,183)

Adjustment to reflect redemption value of redeemable noncontrolling interests

(67,749)

(67,749)

Balance at March 31, 2023

$

44,615

$

3,292

$

7,494,042

$

(3,627,873)

$

6,823

$

210

$

3,921,109

    

    

    

    

Distributions

    

Accumulated Other Comprehensive

    

    

Preferred

Common

Paid-in

in Excess of

Income/(Loss),

Noncontrolling

Stock

Stock

Capital

Net Income

net

Interests

Total

Balance at December 31, 2021

$

44,765

$

3,181

$

6,884,269

$

(3,485,080)

$

(4,261)

$

31,430

$

3,474,304

Net income/(loss) attributable to UDR, Inc.

 

 

 

 

13,705

 

 

 

13,705

Long Term Incentive Plan Unit grants/(vestings), net

 

 

 

 

 

 

(31,220)

 

(31,220)

Other comprehensive income/(loss)

 

 

 

 

 

7,066

 

 

7,066

Issuance/(forfeiture) of common and restricted shares, net

 

 

1

 

(1,041)

 

 

 

 

(1,040)

Issuance of common shares through public offering, net

 

 

 

(99)

 

 

 

 

(99)

Adjustment for conversion of noncontrolling interest of unitholders in the Operating Partnership and DownREIT Partnership

 

 

2

 

8,578

 

 

 

 

8,580

Common stock distributions declared ($0.38 per share)

 

 

 

 

(121,068)

 

 

 

(121,068)

Preferred stock distributions declared-Series E ($0.4114 per share)

 

 

 

 

(1,092)

 

 

 

(1,092)

Adjustment to reflect redemption value of redeemable noncontrolling interests

 

 

 

 

43,747

 

 

 

43,747

Balance at March 31, 2022

$

44,765

$

3,184

$

6,891,707

$

(3,549,788)

$

2,805

$

210

$

3,392,883

See accompanying notes to consolidated financial statements.

6

Table of Contents

UDR, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, except for share data)

(Unaudited)

Three Months Ended March 31, 

    

2023

    

2022

Operating Activities

  

 

  

Net income/(loss)

$

32,925

$

14,603

Adjustments to reconcile net income/(loss) to net cash provided by/(used in) operating activities:

 

  

 

  

Depreciation and amortization

 

172,949

 

166,697

(Gain)/loss on sale of real estate owned

 

(1)

 

(Income)/loss from unconsolidated entities

 

(9,707)

 

(5,412)

Return on investment in unconsolidated joint ventures and partnerships

 

4,317

 

12,352

Amortization of share-based compensation

 

8,246

 

6,371

Other

 

7,690

 

6,422

Changes in operating assets and liabilities:

 

 

  

(Increase)/decrease in operating assets

 

(7,119)

 

4,979

Increase/(decrease) in operating liabilities

 

(41,285)

 

(44,992)

Net cash provided by/(used in) operating activities

 

168,015

 

161,020

Investing Activities

 

  

 

  

Development of real estate assets

 

(42,498)

 

(56,755)

Capital expenditures and other major improvements — real estate assets

 

(54,353)

 

(34,615)

Capital expenditures — non-real estate assets

 

(4,532)

 

(9,677)

Investment in unconsolidated joint ventures and partnerships

 

(1,821)

 

(48,233)

Distributions received from unconsolidated joint ventures and partnerships

 

3,108

 

68,185

Purchase deposits on pending acquisitions

(743)

(6,000)

Repayment/(issuance) of notes receivable, net

 

(16,501)

 

284

Net cash provided by/(used in) investing activities

 

(117,340)

 

(86,811)

Financing Activities

 

  

 

  

Payments on secured debt

 

(292)

 

(280)

Net proceeds/(repayment) of commercial paper

 

105,000

 

60,000

Net proceeds/(repayment) of revolving bank debt

 

(14,244)

 

7,648

Proceeds from the issuance of common shares through public offering, net

 

(462)

 

(99)

Distributions paid to redeemable noncontrolling interests

 

(8,178)

 

(7,862)

Distributions paid to preferred stockholders

 

(1,097)

 

(1,050)

Distributions paid to common stockholders

 

(125,083)

 

(115,405)

Other

 

(7,303)

 

(18,652)

Net cash provided by/(used in) financing activities

 

(51,659)

 

(75,700)

Net increase/(decrease) in cash, cash equivalents, and restricted cash

 

(984)

 

(1,491)

Cash, cash equivalents, and restricted cash, beginning of year

 

30,194

 

28,418

Cash, cash equivalents, and restricted cash, end of period

$

29,210

$

26,927

Supplemental Information:

 

  

 

  

Interest paid during the period, net of amounts capitalized

$

64,707

$

55,126

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

3,126

3,126

Cash paid/(refunds received) for income taxes

 

206

 

222

Non-cash transactions:

 

  

 

  

Redeemable long-term and short-term incentive plan units

$

6,989

$

37,383

Development costs and capital expenditures incurred, but not yet paid

 

35,524

 

43,571

Conversion of Operating Partnership and DownREIT Partnership noncontrolling interests to common stock (9,957 shares and 142,984 shares, respectively)

 

386

 

8,580

Distribution of equity securities from unconsolidated real estate technology investments

7,749

6,508

Dividends declared, but not yet paid

 

148,409

 

130,369

The following reconciles cash, cash equivalents, and restricted cash to amounts as shown above:

Cash, cash equivalents, and restricted cash, beginning of year:

Cash and cash equivalents

$

1,193

$

967

Restricted cash

29,001

27,451

Total cash, cash equivalents, and restricted cash as shown above

$

30,194

$

28,418

Cash, cash equivalents, and restricted cash, end of period:

Cash and cash equivalents

$

1,172

$

895

Restricted cash

28,038

26,032

Total cash, cash equivalents, and restricted cash as shown above

$

29,210

$

26,927

See accompanying notes to consolidated financial statements.

7

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2023

1. BASIS OF PRESENTATION

Organization and Formation

UDR, Inc. (“UDR,” the “Company,” “we,” or “our”) is a self-administered real estate investment trust, or REIT, that owns, operates, acquires, renovates, develops, redevelops, and manages apartment communities in targeted markets located in the United States. At March 31, 2023, our consolidated apartment portfolio consisted of 166 communities with a total of 55,159 apartment homes located in 21 markets. In addition, the Company has an ownership interest in 9,099 completed or to-be-completed apartment homes through unconsolidated joint ventures or partnerships, including 6,262 apartment homes owned by entities in which we hold preferred equity investments.

Basis of Presentation

The accompanying consolidated financial statements of UDR include its wholly-owned and/or controlled subsidiaries (see Note 4, Variable Interest Entities and Note 5, Joint Ventures and Partnerships, for further discussion). All significant intercompany accounts and transactions have been eliminated in consolidation.

The accompanying consolidated financial statements include the accounts of UDR and its subsidiaries, including United Dominion Realty, L.P. (the “Operating Partnership” or the “OP”) and UDR Lighthouse DownREIT L.P. (the “DownREIT Partnership”). As of March 31, 2023, there were 186.4 million units in the Operating Partnership (“OP Units”) outstanding, of which 176.3 million OP Units (including 0.1 million of general partnership units), or 94.6%, were owned by UDR and 10.1 million OP Units, or 5.4%, were owned by outside limited partners. As of March 31, 2023, there were 32.4 million units in the DownREIT Partnership (“DownREIT Units”) outstanding, of which 21.1 million, or 65.1%, were owned by UDR and its subsidiaries and 11.3 million, or 34.9%, were owned by outside limited partners. The consolidated financial statements of UDR include the noncontrolling interests of the unitholders in the Operating Partnership and DownREIT Partnership.

The accompanying interim unaudited consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted according to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, all adjustments and eliminations necessary for the fair presentation of our financial position as of March 31, 2023, and results of operations for the three months ended March 31, 2023 and 2022, have been included. Such adjustments are normal and recurring in nature. The interim results presented are not necessarily indicative of results that can be expected for a full year. The accompanying interim unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended December 31, 2022 appearing in UDR’s Annual Report on Form 10-K, filed with the SEC on February 13, 2023.

The accompanying interim unaudited consolidated financial statements are presented in accordance with U.S. generally accepted accounting principles (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the interim unaudited consolidated financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. All significant intercompany accounts and transactions have been eliminated in consolidation.

The Company evaluated subsequent events through the date its financial statements were issued. No significant recognized or non-recognized subsequent events were noted.

2. SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The Company accounts for subsidiary partnerships, joint ventures and other similar entities in which it holds an ownership interest in accordance with the consolidation guidance. The Company first evaluates whether each entity is a

8

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

MARCH 31, 2023

variable interest entity (“VIE”). Under the VIE model, the Company consolidates an entity when it has control to direct the activities of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, the Company consolidates an entity when it controls the entity through ownership of a majority voting interest.

Real Estate Sales Gain Recognition

For sale transactions resulting in a transfer of a controlling financial interest of a property, the Company generally derecognizes the related assets and liabilities from its Consolidated Balance Sheets and records the gain or loss in the period in which the transfer of control occurs. If control of the property has not transferred to the counterparty, the criteria for derecognition are not met and the Company will continue to recognize the related assets and liabilities on its Consolidated Balance Sheets.

Sale transactions to entities in which the Company sells a controlling financial interest in a property but retains a noncontrolling interest are accounted for as partial sales. Partial sales resulting in a change in control are accounted for at fair value and a full gain or loss is recognized. Therefore, the Company will record a gain or loss on the partial interest sold, and the initial measurement of our retained interest will be accounted for at fair value.

Sales of real estate to joint ventures or other noncontrolled investees are also accounted for at fair value and the Company will record a full gain or loss in the period the property is contributed.

To the extent that the Company acquires a controlling financial interest in a property that it previously accounted for as an equity method investment, the Company will not remeasure its previously held interest if the acquisition is treated as an asset acquisition. The Company will include the carrying amount of its previously held equity method interest along with the consideration paid and transaction costs incurred in determining the amounts to allocate to the related assets and liabilities acquired on its Consolidated Balance Sheets. When treated as an asset acquisition, the Company will not recognize a gain or loss on consolidation of a property.

Allowance for Credit Losses

The Company accounts for allowance for credit losses under the current expected credit loss (“CECL”) impairment model for its financial assets, including trade and other receivables, held-to-maturity debt securities, loans and other financial instruments, and presents the net amount of the financial instrument expected to be collected. The CECL impairment model excludes operating lease receivables. The CECL impairment model requires an estimate of expected credit losses, measured over the contractual life of an instrument, that considers forecasts of future economic conditions in addition to information about past events and current conditions. Based on this model, we analyze the following criteria, as applicable in developing allowances for credit losses: historical loss information, the borrower’s ability to make scheduled payments, the remaining time to maturity, the value of underlying collateral, projected future performance of the borrower and macroeconomic trends.

The Company measures credit losses of financial assets on a collective (pool) basis when similar risk characteristics exist. If the Company determines that a financial asset does not share risk characteristics with the Company’s other financial assets, the Company evaluates the financial asset for expected credit losses on an individual basis. Allowance for credit losses are recorded as a direct reduction from an asset’s amortized cost basis. Credit losses and recoveries are recorded in Interest income and other income/(expense), net on the Consolidated Statements of Operations. Recoveries of financial assets previously written off are recorded when received. For the three months ended March 31, 2023 and 2022, the Company recorded net credit recoveries/(losses) of $(0.1) million and less than $0.1 million, respectively, on the Consolidated Statements of Operations.

The Company has made the optional election provided by the standard not to measure allowance for credit losses for accrued interest receivables as the Company writes off any uncollectible accrued interest receivables in a timely manner. The Company periodically evaluates the collectability of its accrued interest receivables. A write-off is recorded when the Company concludes that all or a portion of its accrued interest receivable balance is no longer collectible.

9

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

MARCH 31, 2023

Notes Receivable

Notes receivable relate to financing arrangements which are typically secured by assets of the borrower that may include real estate assets. Certain of the loans we extend may include characteristics such as options to purchase the project within a specific time window following expected project completion. These characteristics can cause the loans to fall under the definition of a VIE, and thus trigger consolidation consideration. We consider the facts and circumstances pertinent to each loan, including the relative amount of financing we are contributing to the overall project cost, decision making rights or control we hold, and our rights to expected residual gains or our obligations to absorb expected residual losses from the project. If we are deemed to be the primary beneficiary of a VIE due to holding a controlling financial interest, the majority of decision making control, or by other means, consolidation of the VIE would be required. The Company has concluded that it is not the primary beneficiary of the borrowing entities of the existing loans.

Additionally, we analyze each loan arrangement that involves real estate development to consider whether the loan qualifies for accounting as a loan or as an investment in a real estate development project. The Company has evaluated its real estate loans, where appropriate, for accounting treatment as loans versus real estate development projects, as required by Accounting Standards Codification (“ASC”) 310-10. For each loan, the Company has concluded that the characteristics and the facts and circumstances indicate that loan accounting treatment is appropriate.

The following table summarizes our Notes receivable, net as of March 31, 2023 and December 31, 2022 (dollars in thousands):

Interest rate at

Balance Outstanding

    

March 31, 

    

March 31, 

    

December 31, 

2023

2023

2022

Note due December 2023 (a)

10.00

%  

$

31,675

$

30,377

Note due December 2026 (b)

11.00

%  

27,882

17,292

Note due December 2026 (c)

11.00

%  

8,925

5,813

Notes due June 2027 (d)

18.00

%  

3,000

1,500

Notes Receivable

71,482

54,982

Allowance for credit losses

(357)

(275)

Total notes receivable, net

 

  

$

71,125

$

54,707

(a)The Company has a secured note with an unaffiliated third party with an aggregate commitment of $31.4 million, of which $29.2 million was funded as of March 31, 2023. Interest payments are due monthly, with the exception of payments from June 2022 to December 2023, which are accrued and added to the principal balance and will be due at maturity of the note. The additional amount accrued and added to the principal balance was $2.5 million as of March 31, 2023. The note is secured by substantially all of the borrower’s assets and matures at the earliest of the following: (a) the closing of any private or public capital raising in the amount of $5.0 million or greater; (b) an acquisition; (c) acceleration in the event of default; or (d) December 2023.
(b)The Company has a secured mezzanine loan with a third party developer of a 482 apartment home community located in Riverside, California, which is expected to be completed in 2025, with an aggregate commitment of $59.7 million, of which $10.6 million was funded during the three months ended March 31, 2023. Interest payments accrue for 36 months and are due monthly after the loan has been outstanding for 36 months. The secured mezzanine loan has a scheduled maturity date in December 2026, with two one-year extension options.
(c)The Company has a secured mezzanine loan with a third party developer of a 237 apartment home community located in Menifee, California, which is expected to be completed in 2025, with an aggregate commitment of $24.4 million, of which $3.1 million was funded during the three months ended March 31, 2023. Interest payments accrue for 36 months and are due monthly after the loan has been outstanding for 36 months. The secured mezzanine loan has a scheduled maturity date in December 2026, with two one-year extension options.
(d)The Company and a syndicate of lenders previously entered into a $16.0 million secured credit facility with an unaffiliated third party. During the three months ended March 31, 2023, the secured credit facility was amended to provide a new term loan in the amount of $19.0 million, and increase the Company’s commitment from $1.5 million to $3.0 million, all of which has been funded. Interest payments will accrue and be due at maturity of the facility.

10

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

MARCH 31, 2023

The facility is secured by substantially all of the borrower’s assets and matures at the earliest of the following: (a) acceleration in the event of default; or (b) June 2027.

The Company recognized $1.6 million and $0.7 million of interest income for the notes receivable described above during the three months ended March 31, 2023 and 2022, respectively, none of which was related party interest. Interest income is included in Interest income and other income/(expense), net on the Consolidated Statements of Operations.

Comprehensive Income/(Loss)

Comprehensive income/(loss), which is defined as the change in equity during each period from transactions and other events and circumstances from nonowner sources, including all changes in equity during a period except for those resulting from investments by or distributions to stockholders, is displayed in the accompanying Consolidated Statements of Comprehensive Income/(Loss). For the three months ended March 31, 2023 and 2022, the Company’s other comprehensive income/(loss) consisted of the gain/(loss) on derivative instruments that are designated as and qualify as cash flow hedges, (gain)/loss on derivative instruments reclassified from other comprehensive income/(loss) into earnings, and the allocation of other comprehensive income/(loss) to noncontrolling interests. The (gain)/loss on derivative instruments reclassified from other comprehensive income/(loss) is included in Interest expense on the Consolidated Statements of Operations. See Note 11, Derivatives and Hedging Activity, for further discussion. The allocation of other comprehensive income/(loss) to redeemable noncontrolling interests during the three months ended March 31, 2023 and 2022 was $(0.1) million and $0.5 million, respectively.

Income Taxes

Due to the structure of the Company as a REIT and the nature of the operations for the operating properties, no provision for federal income taxes has been provided for at UDR. Historically, the Company has generally incurred only state and local excise and franchise taxes. UDR has elected for certain consolidated subsidiaries to be treated as taxable REIT subsidiaries (“TRS”).

Income taxes for our TRS are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rate is recognized in earnings in the period of the enactment date. The Company’s deferred tax assets/(liabilities) are generally the result of differing depreciable lives on capitalized assets, temporary differences between book and tax basis of assets and liabilities and timing of expense recognition for certain accrued liabilities. As of March 31, 2023 and December 31, 2022, UDR’s net deferred tax asset/(liability) was $(0.7) million and $(0.8) million, respectively, and are recorded in Accounts payable, accrued expenses and other liabilities on the Consolidated Balance Sheets.

GAAP defines a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. GAAP also provides guidance on derecognition, classification, interest and penalties, accounting for interim periods, disclosure and transition.

The Company recognizes and evaluates its tax positions using a two-step process. First, UDR determines whether a tax position is more likely than not (greater than 50 percent probability) to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Second, the Company will determine the amount of benefit to recognize and record the amount that is more likely than not to be realized upon ultimate settlement.

The Company invests in assets that qualify for federal investment tax credits (“ITC”) through our TRS. An ITC reduces federal income taxes payable when qualifying depreciable property is acquired. The ITC is determined as a percentage of cost of the assets. The Company accounts for ITCs under the deferral method, under which the tax benefit from the ITC is deferred and amortized as a tax benefit into Tax (provision)/benefit, net on the Consolidated Statements of Operations over the book life of the qualifying depreciable property. The ITCs are recorded in Accounts payable, accrued expenses and other liabilities on the Consolidated Balance Sheets.

11

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

MARCH 31, 2023

UDR had no material unrecognized tax benefit, accrued interest or penalties at March 31, 2023. UDR and its subsidiaries are subject to federal income tax as well as income tax of various state and local jurisdictions. The tax years 2019 through 2021 remain open to examination by tax jurisdictions to which we are subject. When applicable, UDR recognizes interest and/or penalties related to uncertain tax positions in Tax (provision)/benefit, net on the Consolidated Statements of Operations.

Forward Sales Agreements

From time to time the Company utilizes forward sales agreements for the future issuance of its common stock. When the Company enters into a forward sales agreement, the contract requires the Company to sell its shares to a counterparty at a predetermined price at a future date. The net sales price and proceeds attained by the Company will be determined on the dates of settlement, with adjustments during the term of the contract for the Company’s anticipated dividends as well as for a daily interest factor that varies with changes in the federal funds rate. The Company generally has the ability to determine the dates and method of settlement (i.e., gross physical settlement, net share settlement or cash settlement), subject to certain conditions and the right of the counterparty to accelerate settlement under certain circumstances.

The Company accounts for the shares of common stock reserved for issuance upon settlement as equity in accordance with ASC 815-40, Contracts in Entity's Own Equity, which permits equity classification when a contract is considered indexed to the entity’s own stock and the contract requires or permits the issuing entity to settle the contract in shares (either physically or net in shares).

The guidance establishes a two-step process for evaluating whether an equity-linked financial instrument is considered indexed to the entity’s own stock, first, evaluating the instrument’s contingent exercise provisions and second, evaluating the instrument’s settlement provisions. When entering into forward sales agreements, we determined that (i) none of the agreement’s exercise contingencies are based on observable markets or indices besides those related to the market for our own stock price; and (ii) none of the settlement provisions preclude the agreements from being indexed to our own stock.

Before the issuance of shares of common stock, upon physical or net share settlement of the forward sales agreements, the Company expects that the shares issuable upon settlement of the forward sales agreements will be reflected in its diluted income/(loss) per share calculations using the treasury stock method. Under this method, the number of shares of common stock used in calculating diluted income/(loss) per share is deemed to be increased by the excess, if any, of the number of shares of common stock that would be issued upon full physical settlement of the forward sales agreements over the number of shares of common stock that could be purchased by the Company in the open market (based on the average market price during the period) using the proceeds receivable upon full physical settlement (based on the adjusted forward sale price at the end of the reporting period). When the Company physically or net share settles any forward sales agreement, the delivery of shares of common stock would result in an increase in the number of weighted average common shares outstanding and dilution to basic income/(loss) per share. (See Note 8, Income/(Loss) per Share for further discussion.)

Lease Receivables

During the three months ended March 31, 2023, the Company performed an analysis in accordance with the ASC 842, Leases, guidance to assess the collectibility of its operating lease receivables. This analysis included an assessment of collectibility of current and future rents and whether those lease payments were no longer probable of collection. In accordance with the leases guidance, if lease payments are no longer deemed to be probable over the life of the lease contract, we recognize revenue only when cash is received, and all existing contractual operating lease receivables and straight-line lease receivables are reserved. 

As a result of its analysis, the Company reduced its reserve to approximately $6.1 million for multifamily tenant lease receivables and increased its reserve to approximately $4.4 million for retail tenant lease receivables for its wholly-owned communities and communities held by joint ventures. In aggregate, the reduction in reserve is reflected as a $2.3 million increase to Rental income and a $0.2 million increase to Income/(loss) from unconsolidated entities on the Consolidated Statements of Operations for the three months ended March 31, 2023.

12

Table of Contents

UDR, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

MARCH 31, 2023

3. REAL ESTATE OWNED

Real estate assets owned by the Company consist of income producing operating properties, properties under development, land held for future development, and held for disposition properties. As of March 31, 2023, the Company owned and consolidated 166 communities in 13 states plus the District of Columbia totaling 55,159 apartment homes. The following table summarizes the carrying amounts for our real estate owned (at cost) as of March 31, 2023 and December 31, 2022 (dollars in thousands):

    

March 31, 

    

December 31, 

2023

2022

Land

$

2,566,680

$

2,539,499

Depreciable property — held and used:

 

 

  

Land improvements

 

258,194

 

254,578

Building, improvements, and furniture, fixtures and equipment

 

12,691,028

 

12,521,838

Real estate intangible assets

50,013

50,013

Under development:

 

  

 

  

Land and land improvements