HOM/U: On the road to FFO recovery

Research evidence excerpt

HOM/U: On the road to FFO recovery

BSR REIT

Target/Upside/Downside Scenarios Investment summary

Our Sector Perform rating is primarily a function of our risk-BSR REIT

adjusted total return expectations compared with the broader

16 125 Weeks 22DEC23 - 14MAY26 REIT/REOC sector. Key elements of the BSR REIT story include

15 the following:

TARGETTARGET 13.0013.00

12 A major market Sunbelt apartment REIT. BSR owns a portfolio

11 CURRENTCURRENT 11.3811.38

10 of predominantly high-quality, Class B properties, located

9 principally in large, suburban markets. Based on NOI, 97%

7 of the portfolio is located in BSR’s target markets of Dallas,

6 Houston, Austin, and Oklahoma City. The US Sunbelt markets

1.5m have been beneficiaries of large migration from other states,

1m leading to strong fundamentals. 500k

2024 2025 2026

D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M

HOM/U CN Rel. S&P 500 COMPOSITE MA 40 weeks Deep and liquid market supports large roll-up opportunity.

Source: Bloomberg and RBC Capital Markets estimates for Target Across BSR’s four target markets of Austin, Dallas, Houston,

and Oklahoma City, there were approximately $27B of garden-Valuation

style apartment transactions in 2022, versus $11B across theOur $13.00 price target is based on a 20% discount to

entire Canadian apartment sector. BSR has an active pipelineour $16.50 NAVPU estimate one year hence, which implies

of acquisition and disposition opportunities, as the REIT aimsa 19x multiple to our 2026E AFFOPU. We believe our

to recycle capital into higher-growth markets.target valuation multiple reflects BSR’s internal management

platform, significant insider ownership, and the necessity- A fully internalized and aligned platform built for growth.oriented nature of its portfolio.