Mahbod Nia, CEO of Veris Residential, Inc. (NYSE: VRE), sat down for a video interview at Nareit’s REITweek: 2024 Investor Conference, held in New York from June 3-6.
Nia highlighted the robust macroeconomic conditions that continue to underpin the company’s growth, noting that they are supported by ongoing job and wage growth that bolsters revenue. He noted that limited supply in Veris’s markets, coupled with broader national shortages in the multifamily sector, enhances the company's ability to outperform other asset classes.
Nia also discussed the challenges and opportunities within the multifamily sector, pointing out that transaction volumes have decreased significantly over the past few years, with a notable 40%-50% drop from 2022 to 2023, and a further 25% decline in Q1 of this year compared to the previous year. Despite this, he observes positive signs, including a convergence of value expectations between buyers and sellers that have led to an increase in transactions, especially smaller deals and some larger portfolio trades to private opportunity funds.
Reflecting on Veris Residential’s strategic shift, Nia highlighted the transformation from a primarily office-focused portfolio to a pure-play multifamily REIT. He mentioned that the company has repaid $1 billion of debt, reinstated its dividend, and implemented a three-pronged strategy focusing on capital allocation, portfolio and platform optimization, and balance sheet optimization.
"We’re making progress along all three of those areas," Nia stated, noting that this progress has enabled the REIT to raise its guidance and dividend.
Nia also addressed the company's commitment to environmental, social, and governance issues, describing ESG as integral to the company’s decision-making process.
"If there are things that we can do that ultimately reduce our carbon footprint, while allowing us to reduce our operating expenses and create value for our shareholders, for example, why wouldn’t we do that?" he said.