AvalonBay Communities : Presentation PDF Q1 2026

Published: 2026-04-27 16:22:17 ET AVB

Published on 04/27/2026 at 04:22 pm EDT

INVESTOR TELECONFERENCE PRESENTATION

FIRST QUARTER 2026

APRIL 28, 2026

PARTICIPANTS

BEN SCHALL Chief Executive Officer & President

KEVIN O'SHEA Chief Financial Officer MATT BIRENBAUM Chief Investment Officer SEAN BRESLIN Chief Operating Officer

FIRST QUARTER HIGHLIGHTS

→ YTD rent trends as expected; turnover continues to trend at historical lows

Source: Internal company reports

(1) Relative to 1Ǫ2c Core FFO per Share Outlook midpoint provided in the Company's Earnings Release dated February 4, 202c.

4 4

REVIEW OF 1Q26 RESULTS AND ACTIVITY

SAME STORE RESIDENTIAL REVENUE GROWTH

YEAR-OVER-YEAR

DEVELOPMENT STARTS

DISPOSITIONS

SHARES REPURCHASED

Source: Internal company reports.

1.6%

$188M

$341M

$198M

RESULTS & ACTIVITY 1Q26

1Q26 Core FFO per Share Outlook vs. Actual

Based on Outlook Range Midpoint

$2.85

REVENUE

OPEX

20%

$0.01

$2.83

80%

$0.01

$2.78

$0.02

$2.80

$2.75

OUTLOOK

(Midpoint)

SAME STORE RESIDENTIAL NOI(1)

DEVELOPMENT NOI

COMMERCIAL NOI AND OTHER

CAPITAL MARKETS & TRANSACTION

ACTIVITY(2)

ACTUAL

Source: Internal company reports.

See Appendix for a reconciliation of Net Income attributable to common stockholders to FFO and to Core FFO.

Approximately 80% of the favorable variance is due to lower than anticipated operating expenses, which we expect to incur throughout the remainder of 202c. The remaining 20% represents favorable revenue.

Due primarily to the impact of stock repurchases during Ǫ1 202c. 6

98%

MARKET OCCUPANCY (INCLUDING LEASE-UPS)

4.2%

2010 - 1Q26

6.0%

WAGE GROWTH

2023 - 2025 ACTUAL, '26 YTD MARCH TRAILING 3 MONTH AVG.

3.7%

3.9%

4.0%

4.3%

92% 3.0%

86%

6.0%

3.0%

1.8%

Established Regions Expansion Regions

NEW MARKET RATE APARTMENT DELIVERIES

AS A % OF EXISTING INVENTORY

4.2%

1.4%

0.8%

2.4%

0.8%

$2,250

2.3%

$1,000

($250)

2023 2024 2025 2026

YTD

MEDIAN MORTGAGE LESS MEDIAN RENT(1)

2020 - 1Q26

8% MOVE-OUT TO HOME PURCHASE

1Q26 AVB PORTFOLIO

10 Yr. Avg. 2025 2026f 2027f

2020 2021 2022 2023 2024 2025 2026

U.S. Established Regions Expansion Regions

Source: Bureau of Labor Statistics (BLS), CoStar, AVB Market Research Group, Federal Reserve Bank of Atlanta Wage Growth Tracker,

(1) As of 1Ǫ2c, based on a median monthly mortgage payment (30-year fixed rate, 20% down payment, average property tax) minus monthly apartment rent (80+ unit buildings), the median mortgage payment in Established Regions was ~:2,100/month more expensive than the median apartment rent.

Incremental NOI from Operating Initiatives

Relative to 2021 Baseline

Projected Development NOI

$47M

2026

Occupancies

~$75M

2027

Occupancies

$47M

2026

Occupancies

Calendar Year, Projected

~$120M

Achieved YE25 Run-rate

$80M

$48M

$55M Original Horizon 1

YE2c Projected Achievement

'26 Forecast

'27+ Target

'26 Priorities

Accelerate AI Solutions

Deliver seamless, digital, self-serve experiences

Modernize Technology & Data Platforms

Optimize Neighborhood & Centralized Staffing

2026 2027

$3.5B

Projected Total Capital Cost

6.3%

Projected Initial Stabilized Yield

4.9%

Initial Cost of External

Capital Sourced '23-'25(2)

Development Underway | 1Q26(1)

Source: Internal company reports

For additional information, please refer to Attachment 7 in the Company's Earnings Release dated April 27, 202c.

Capital sourced includes net proceeds from all equity and debt issuances, wholly-owned dispositions, and distributions from unconsolidated real estate entities. Weighted average initial cost of capital includes all equity and debt (inclusive of the effect of interest rate hedges) issuances, and wholly-owned dispositions only.

1Q26 Closed Dispositions

Share Repurchase Activity

2H25 and 1Q26 Actual

$198M

1Q26

2H25

$700M

$341M

3 Communities

5.4%

Market Cap Rate

$385k

Value Per Home

~2x

Highrise

21 yrs

Disposition KPIs

40 yrs.

Low-6% implied cap rate

$914M remaining authorization(2)

$350M

Asset Age(1)

Source: Internal company reports

Asset Age represented based on weighted average.

YTD ASKING RENT GROWTH CONSISTENT WITH ORIGINAL EXPECTATIONS;

CLOSER TO NORMAL SEASONALITY IN '26 AND EASIER COMPS IN 2H

YTD Indexed Weekly Asking Rent Growth

Actual

2015 - '19 Avg. 2025 2026 YTD

108

106

104

102

100

WEEK

Source: Internal company reports

PORTFOLIO WELL POSITIONED INTO PEAK LEASING SEASON

2026 SAME STORE RESIDENTIAL

STEADY OCCUPANCY THROUGH APRIL

ECONOMIC OCCUPANCY

TURNOVER REMAINS WELL BELOW HISTORICAL NORMS

ANNUALIZED TURNOVER

96.5%

45%

96.0%

35%

95.5%

25%

JAN FEB MAR APR JAN

FEB

MAR

APR

% OF AVAILABLE HOMES TO LEASE TRENDING BELOW LAST YEAR

30 DAY AVAILABILITY

RENT CHANGE UP 260 BASIS POINTS SINCE JANUARY

LIKE-TERM EFFECTIVE RENT CHANGE

5.5% 2.5%

1.9%

1.5%

5.0%

0.5%

4.5%

(0.5%)

JAN FEB MAR APR JAN FEB MAR APR

(0.5%)

Source: Internal company reports.

Turnover is the annualized number of units turned over during the period, divided by the total number of apartment homes for the respective period, and excludes any third-party managed communities.

LEASE-UP ABSORPTION OFF TO STRONG START, WITH 1Q LEASING ACTIVITY WELL ABOVE LONG-TERM AVERAGE

Current Lease-Up Communities(1)

Development Net New Leasing Volume(1)

Average New Leases per Month per Lease-Up Community

Development Occupancies(1)

1Q26, Actual vs. Forecast

650

Communities

6.4%

Projected Initial

Stabilized Yield

$1.5B

Projected Total Capital Cost

20 325

Jan Feb Mar

YTD Actual Average Q1 Velocity 2015-2025

Jan Feb Mar

Source: Internal company reports.

(1) Current Lease-up Communities represent S communities: Avalon South Miami, Avalon Hunt Valley West, Avalon Lake Norman, Avalon Wayne, Avalon W Squared at Princeton Junction, Avalon Parsippany, Avalon at Becker Farm, Avalon

This presentation dated April 28, 2026 is provided in connection with AvalonBay's first quarter 2026 earnings conference call on April 28, 2026. This presentation is intended to accompany AvalonBay's earnings release dated April 27, 2026 and should be read in conjunction with the earnings release. AvalonBay does not intend to update any of these documents, which speak only as of their respective dates.

The earnings release is available on AvalonBay's website at https://investors.avalonbay.com/

For definitions, additional information and reconciliations of non-GAAP financial information and certain defined terms included in this presentation, see pages 15 to 21 in this presentation in addition to Attachment 10 to the earnings release.

This presentation dated April 28, 2026 contains forward-looking statements, which are indicated by the use of words such as "expects," "projects," "forecast," "outlook," "estimate" and other words that do not relate to historical matters. Forward-looking statements, by their very nature, are subject to inherent risks and uncertainties and are based on several assumptions, both general and specific, which give rise to the possibility that actual results or events could differ materially from our expectations expressed in or implied by such forward-looking statements. These statements are not guarantees of future performance or events and the Company cautions you against relying on any of these forward-looking statements. For information concerning risks and other factors that could cause such differences, see "Forward-Looking Statements" in AvalonBay's first quarter 2026 earnings release that accompanies this presentation. The Company does not undertake a duty to update the projections and expectations stated in this presentation, which speak only as of the date of this presentation unless otherwise referenced.

Commercial represents results attributable to the non-apartment components of the Company's mixed-use communities and other non-residential operations.

Development is composed of consolidated communities that are either currently under construction or were under construction and were completed during the current year. These communities may be partially or fully complete and operating.

Established Regions include markets located in New England, the New York/New Jersey Metro area, the Mid-Atlantic, the Pacific Northwest, and Northern and Southern California.

Expansion Regions include markets located in Raleigh-Durham and Charlotte, North Carolina, Southeast Florida, Dallas and Austin, Texas, and Denver,

Colorado.

Economic Occupancy is defined as total possible Residential revenue less vacancy loss as a percentage of total possible Residential revenue. Total possible Residential revenue (also known as "gross potential") is determined by valuing occupied units at contract rates and vacant units at Market Rents. Vacancy loss is determined by valuing vacant units at current Market Rents. By measuring vacant apartments at their Market Rents, Economic Occupancy takes into account the fact that apartment homes of different sizes and locations within a community have different economic impacts on a community's gross revenue.

FFO and Core FFO are generally considered by management to be appropriate supplemental measures of our operating and financial performance. FFO is calculated by the Company in accordance with the definition adopted by Nareit. FFO is calculated by the Company as Net income or loss attributable to common stockholders computed in accordance with GAAP, adjusted for gains or losses on sales of previously depreciated operating communities, cumulative effect of a change in accounting principle, impairment write-downs of depreciable real estate assets, write-downs of investments in affiliates due to a decrease in the value of depreciable real estate assets held by those affiliates and depreciation of real estate assets, including similar adjustments for unconsolidated partnerships and joint ventures, including those from a change in control. FFO can help one compare the operating and financial performance of a real estate company between periods or as compared to different companies because adjustments such as (i) gains or losses on sales of previously depreciated property or (ii) real estate depreciation may impact comparability between companies as the amount and timing of these or similar items can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates. Core FFO is the Company's FFO as adjusted for non-core items outlined in the table below. By further adjusting for items that we do not consider to be part of our core business operations, Core FFO can help with the comparison of core operating performance of the Company between periods. A reconciliation of Net income attributable to common stockholders to FFO and to Core FFO is as follows (dollars in thousands):

Amounts for Q1 2026 consist primarily of unrealized losses on property technology and sustainability fund investments, as well as the distribution from an unconsolidated real estate venture. Amounts for Q1 2025 consist primarily of net unrealized losses on property technology and sustainability fund investments.

Represents changes to the loan loss reserve associated with the Company's lending commitments primarily under its Structured Investment Program. The timing and amount of any actual losses that will be incurred, if any, is to be determined.

Amounts for Q1 2025 include a write-off of $3,668 for one development opportunity that the Company determined is no longer probable.

Amounts for Q1 2026 include gains on sale of non-operating real estate. Amounts for Q1 2025 include gains on sale of non-operating real estate, as well as the imputed carry cost of for-sale residential condominiums at The Park Loggia.

Incremental NOI represents additional NOI that was not achieved in the prior period before the implementation of certain operating initiatives and that is

attributable, in future periods, to the implementation of these initiatives. The total projected benefits of the Company's Horizon 1 and Horizon 2 opportunities were subsequently combined to reflect the Company's $80M Incremental NOI target. The benefits from the Horizon 1 opportunities began to be achieved in 2022, while Horizon 2 initiatives are in various stages of development and deployment.

Initial Stabilized Yield represents NOI as a percentage of Total Capital Cost for the first 12 months after Stabilized Operations and is weighted based on the Total Capital Cost of each community.

Like-Term Effective Rent Change for an individual apartment home represents the percentage change in effective rent between two leases of the same lease term category for the same apartment. The Company defines effective rent as the contractual rent for an apartment less amortized concessions and discounts. Like-Term Effective Rent Change with respect to multiple apartment homes represents an average. New Move-In Like-Term Effective Rent Change is the change in effective rent between the contractual rent for a resident who moves out of an apartment, and the contractual rent for a resident who moves into the same apartment with the same lease term category. Renewal Like-Term Effective Rent Change is the change in effective rent between two consecutive leases of the same lease term category for the same resident occupying the same apartment.

Market Cap Rate is defined by the Company as Projected NOI of a single community for the first 12 months of operations (assuming no repositioning), less an estimate of typical capital expenditure allowance per apartment home, divided by the gross sales price for the community. Projected NOI, as referred to above, represents management's estimate of projected rental revenue minus projected operating expenses before interest, income taxes (if any), depreciation and amortization. For this purpose, management's projection of operating expenses for the community includes a management fee of 2.5% and an estimate

of typical market costs for insurance, payroll and other operating expenses for which the Company may have proprietary advantages not available to a typical buyer. The Market Cap Rate, which may be determined in a different manner by others, is a measure frequently used in the real estate industry when determining the appropriate purchase price for a property or estimating the value for a property. Buyers may assign different Market Cap Rates to different communities when determining the appropriate value because they (i) may project different rates of change in operating expenses and capital expenditure estimates and (ii) may project different rates of change in future rental revenue due to different estimates for changes in rent and occupancy levels. The weighted average Market Cap Rate is weighted based on the gross sales price of each community.

Market Rents as reported by the Company are based on the current market rates set by the Company based on its experience in renting apartments and publicly available market data. Market Rents for a period are based on the average Market Rents during that period and do not reflect any impact for cash concessions.

NOI is defined by the Company as total property revenue less direct property operating expenses (including property taxes), and excluding corporate-level income (including management, development and other fees), property management and other indirect operating expenses, net of corporate income, expensed transaction, development and other pursuit costs, net of recoveries, interest expense, net, loss on extinguishment of debt, net, general and administrative expense, income from unconsolidated investments, depreciation expense, income tax (benefit) expense, casualty loss, (gain) loss on sale of communities, other real estate activity and net operating income from real estate assets sold or held for sale. The Company considers NOI to be an important and appropriate supplemental performance measure to net income because it helps both investors and management to understand the core operations of a community or communities prior to the allocation of any corporate-level property management overhead or financing-related costs. NOI reflects the operating performance of a community and allows for an easier comparison of the operating performance of individual assets or groups of assets. In addition, because prospective buyers of real estate have different financing and overhead structures, with varying marginal impact to overhead as a result of acquiring real estate, NOI is considered by many in the real estate industry to be a useful measure for determining the value of a real estate asset or group of assets.

Projected FFO and Projected Core FFO, as provided within this presentation in the Company's outlook, are calculated on a basis consistent with historical FFO and Core FFO, and are therefore considered to be appropriate supplemental measures to projected net income from projected operating performance. A reconciliation of the ranges provided for Projected FFO per share (diluted) for the second quarter 2026 to the ranges provided for projected EPS (diluted) and corresponding reconciliation of the ranges for Projected FFO per share to the ranges for Projected Core FFO per share are as follows:

Projected NOI, as used within this presentation for certain Development communities and in calculating the Market Cap Rate for dispositions, represents management's estimate, as of the date of this presentation (or as of the date of the buyer's valuation in the case of dispositions), of projected stabilized rental revenue minus projected stabilized operating expenses. For Development communities, Projected NOI is calculated based on the first twelve months of Stabilized Operations following the completion of construction. In calculating the Market Cap Rate, Projected NOI for dispositions is calculated for the first twelve months following the date of the buyer's valuation. Projected stabilized rental revenue represents management's estimate of projected gross potential minus projected stabilized economic vacancy and adjusted for projected stabilized concessions plus projected stabilized other rental revenue. Projected stabilized operating expenses do not include interest, income taxes (if any), depreciation or amortization, or any allocation of corporate-level property management overhead or general and administrative costs. In addition, projected stabilized operating expenses for Development communities do not include property management fee expense. Projected gross potential for Development communities and dispositions is generally based on leased rents for occupied homes and management's best estimate of rental levels for homes which are currently unleased, as well as those homes which will become available for lease during the twelve-month forward period used to develop Projected NOI. The weighted average Projected NOI as a percentage of Total Capital Cost is weighted based on the Company's share of the Total Capital Cost of each community, based on its percentage ownership.

Residential represents results attributable to the Company's apartment rental operations, including parking and other ancillary Residential revenue.

Same Store is composed of consolidated communities where a comparison of operating results from the prior year to the current year is meaningful as these communities were owned and had Stabilized Operations, as defined below, as of the beginning of the respective prior year period. Therefore, for 2026 operating results, Same Store is composed of consolidated communities that have Stabilized Operations as of January 1, 2025, are not conducting or are not probable to conduct substantial redevelopment activities and are not held for sale or probable for disposition within the current year.

Stabilized Operations is defined as operations of a community that occur after the earlier of (i) attainment of 90% physical occupancy or (ii) the one-year anniversary of completion of development or redevelopment.

Total Capital Cost includes all capitalized costs projected to be or actually incurred to develop the respective Development or Redevelopment community, including land acquisition costs, construction costs, real estate taxes, capitalized interest and loan fees, permits, professional fees, allocated development overhead and other regulatory fees and a contingency estimate, offset by proceeds from the sale of any associated land or improvements, all as determined in accordance with GAAP. Total Capital Cost also includes costs incurred related to first generation commercial tenants, such as tenant improvements and leasing commissions. For Redevelopment communities, Total Capital Cost excludes costs incurred prior to the start of redevelopment when indicated. With respect to communities where development or redevelopment was completed in a prior period or the current period, Total Capital Cost reflects the actual cost incurred, plus any contingency estimate made by management. Total Capital Cost for communities identified as having joint venture ownership, either during construction or upon construction completion, represents the total projected joint venture contribution amount. For joint ventures not in construction, Total

Disclaimer

AvalonBay Communities Inc. published this content on April 27, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 27, 2026 at 20:21 UTC.