Greystone Housing Impact Investors LP (GHI) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $5.2 million ($0.19 per unit/BUC), with CAD of $6.3 million ($0.27 per unit/BUC), and a regular quarterly distribution of $0.37 per unit/BUC paid on July 31, 2024.

• Book value per unit was $13.98 on $1.53 billion in assets; leverage ratio stood at 73%.

• Net income and revenues declined year-over-year due to lower investment income and gains on sales.

• The Partnership operates four segments: Affordable Multifamily MRB Investments, Seniors and Skilled Nursing MRB Investments, Market-Rate Joint Venture Investments, and MF Properties.

• Management remains focused on leveraging market volatility for attractive investment opportunities.

Financial highlights

• Q2 2024 revenues were $21.97 million, down from $28.30 million in Q2 2023; net income for Q2 2024 was $5.18 million, compared to $21.29 million in Q2 2023.

• CAD for Q2 2024 was $6.31 million ($0.27 per unit/BUC), down from $14.14 million ($0.62 per unit/BUC) in Q2 2023.

• Interest expense for Q2 2024 was $14.90 million, down from $17.60 million in Q2 2023.

• Unrestricted cash and equivalents totaled $34 million; $56 million available on secured credit lines.

• Book value per unit decreased by $0.61 from March 31, mainly due to a decline in fair value of the mortgage revenue bond portfolio and the difference between net income and distribution.

Outlook and guidance

• Management expects to meet short-term liquidity needs through cash on hand, operating cash flows, asset redemptions, and potential new debt or equity issuances.

• The Partnership plans to continue investing in affordable and market-rate multifamily properties, with $263.8 million in outstanding investment commitments as of June 30, 2024.

• Additional equity advances to JV investments are anticipated in 2024 to cover development cost overruns, mainly due to higher interest costs.

• Expectation to remain long-term holders of predominantly fixed-rate mortgage revenue bonds, with changes in fair value not impacting operating cash flows, net income, or CAD.

• Interest rate sensitivity analysis shows the portfolio is largely hedged against large fluctuations in net interest income.