Greystone Housing Impact Investors LP (GHI) Q3 2024 earnings summary

Executive summary

• Reported a GAAP net loss of $4.6 million ($0.23 per unit) for Q3 2024, primarily due to $9.7 million in non-cash unrealized losses on interest rate derivatives, compared to net income of $9.7 million in Q3 2023.

• Cash available for distribution (CAD) was $6.2 million ($0.27 per unit), up 11% year-over-year, with a regular quarterly cash distribution of $0.37 per unit paid on October 31, 2024.

• Book value per unit increased to $14.15 as of September 30, 2024, despite market price trading at a 14% discount.

• Revenues for Q3 2024 were $24.3 million, down 8% year-over-year, mainly from lower property loan and GIL balances and the sale of a property.

• Segment net income declined across all segments, with Affordable Multifamily MRB Investments reporting a $3.3 million loss for Q3 2024.

Financial highlights

• Net loss driven by a $9.7 million non-cash unrealized loss from interest rate swaps, offset by positive CAD.

• Total assets increased to $1.55 billion as of September 30, 2024.

• Leverage ratio reported at 74% on $1.55 billion in assets.

• Interest expense for Q3 2024 was $15.5 million, down 14% year-over-year due to lower average debt balances.

• Distributions declared per BUC were $0.37 for Q3 2024.

Outlook and guidance

• Management expects to continue long-term holding of fixed-rate mortgage revenue bonds, with changes in fair value not impacting operating cash flows.

• New construction lending JV with BlackRock launched in October 2024, with an initial $8.3 million capital commitment, aims to capitalize on reduced bank lending in affordable housing.

• The Partnership plans to fund $198 million in remaining investment commitments, primarily for construction and rehabilitation of affordable housing.

• Investment opportunities must be accretive to the current dividend yield, with a focus on scaling capital deployment as opportunities arise.

• Management remains focused on executing its core investment strategy amid ongoing volatility in fixed income and multifamily capital markets.