Invitation Homes Reports Fourth Quarter 2021 and Full Year 2021 Results

DALLAS--(BUSINESS WIRE)--Invitation Homes Inc. (NYSE: INVH) ("Invitation Homes" or the "Company"), the nation's premier single-family home leasing company, today announced its Q4 2021 and FY 2021 financial and operating results.

Fourth Quarter 2021 and Full Year 2021 Highlights

• Year over year, in Q4 2021, total revenues increased 12.1% to $520 million, and property operating and maintenance costs increased 5.5% to $178 million. In FY 2021, total revenues increased 9.5% to $1,997 million, and property operating and maintenance costs increased 3.8% to $706 million.
• In Q4 2021, net income available to common stockholders totaled $74 million or $0.12 per diluted common share. In FY 2021, net income available to common stockholders totaled $261 million or $0.45 per diluted common share.
• Year over year, in Q4 2021, Core FFO per share increased 19.7% to $0.39, and AFFO per share increased 21.0% to $0.33. In FY 2021, Core FFO per share increased 16.2% to $1.49, and AFFO per share increased 18.8% to $1.28.
• In Q4 2021, Same Store NOI grew 12.6% year over year on 9.5% Same Store Core Revenues growth and 3.1% Same Store Core Operating Expenses growth. In FY 2021, Same Store NOI grew 9.4% year over year on 6.4% Same Store Core Revenues growth and 0.5% Same Store Core Operating Expenses growth.
• In Q4 2021, Same Store Average Occupancy was 98.1%. In FY 2021, Same Store Average Occupancy was 98.2%, up 70 basis points year over year.
• In Q4 2021, Same Store new lease rent growth of 17.3% and Same Store renewal rent growth of 9.0% drove Same Store blended rent growth of 11.1%, up 630 basis points year over year. In FY 2021, Same Store new lease rent growth of 14.4% and Same Store renewal rent growth of 6.7% drove Same Store blended rent growth of 8.8%, up 500 basis points year over year.
• In Q4 2021, revenue collections were approximately 99% of the Company's historical average collection rate. Same Store bad debt as a percentage of gross rental revenue decreased from 2.4% in Q4 2020 to 1.1% in Q4 2021.
• In Q4 2021, acquisitions by the Company and the Company's joint ventures totaled 1,543 homes for $656 million while dispositions totaled 139 homes for $51 million. In FY 2021, acquisitions by the Company and the Company's joint ventures totaled 4,802 homes for $1,947 million while dispositions totaled 783 homes for $263 million.
• As previously announced in November 2021, the Company closed a public bond offering of $1 billion aggregate principal balance, consisting of $600 million of bonds with a fixed coupon of 2.3% maturing on November 15, 2028 and $400 million of bonds with a fixed coupon of 2.7% maturing on January 15, 2034. Net proceeds were used primarily to voluntarily prepay secured indebtedness and for general corporate purposes including acquisitions.
• Net debt / TTM adjusted EBITDAre decreased from 7.3x at December 31, 2020 to 6.2x at December 31, 2021.
• As previously announced, the Company agreed to invest $250 million with Pathway Homes, a new real estate company that provides consumers multiple options to purchase a home. In addition to investing in the technology platform and homes for the startup and its real estate fund, Invitation Homes will provide maintenance and other services to all Pathway homes.

President & Chief Executive Officer Dallas Tanner comments:

"2021 was an extraordinary and active year for Invitation Homes. I extend my heartfelt thanks to all of our associates for exceeding the high expectations of our residents and stakeholders throughout the past year. Through multiple channels, we accretively grew our portfolio with nearly $2 billion of acquisitions while reducing our leverage and strengthening our investment-grade balance sheet. Steady job growth and positive demographic trends in our markets continue to generate favorable leasing results across our portfolio, and we expect the demand for single-family rental homes to remain strong in 2022. With these supportive backdrops, we expect Core FFO growth in 2022 of 11.4% at the midpoint of our guidance."

Financial Results

Net Income, FFO, Core FFO, and AFFO Per Share — Diluted^(1)
	Q4 2021		Q4 2020		FY 2021		FY 2020
Net income	$	0.12	$	0.12	$	0.45	$	0.35
FFO		0.35		0.35		1.35		1.24
Core FFO		0.39		0.32		1.49		1.28
AFFO		0.33		0.27		1.28		1.08

(1)	See "Reconciliation of FFO, Core FFO, and AFFO," footnotes (1) and (2), for details on the treatment of convertible notes in each specific period presented in the table.

Net Income

Net income per share in the fourth quarter of 2021 was $0.12, compared to net income per share of $0.12 in the fourth quarter of 2020. Total revenues and total property operating and maintenance expenses in the fourth quarter of 2021 were $520 million and $178 million, respectively, compared to $464 million and $169 million, respectively, in the fourth quarter of 2020.

Net income per share in FY 2021 was $0.45, compared to net income per share of $0.35 in FY 2020. Total revenues and total property operating and maintenance expenses in FY 2021 were $1,997 million and $706 million, respectively, compared to $1,823 million and $681 million, respectively, in FY 2020.

Core FFO

Year over year, Core FFO per share in the fourth quarter of 2021 increased 19.7% to $0.39, primarily due to NOI growth and interest expense savings.

Year over year, Core FFO per share in FY 2021 increased 16.2% to $1.49, primarily due to NOI growth and interest expense savings.

AFFO

Year over year, AFFO per share in the fourth quarter of 2021 increased 21.0% to $0.33, primarily due to the increase in Core FFO per share described above.

Year over year, AFFO per share in FY 2021 increased 18.8% to $1.28, primarily due to the increase in Core FFO per share described above.

Operating Results

Same Store Operating Results Snapshot
Number of homes in Same Store Portfolio:	72,245
	Q4 2021		Q4 2020		FY 2021		FY 2020
Core Revenues growth (year over year)	9.5	%			6.4	%
Core Operating Expenses growth (year over year)	3.1	%			0.5	%
NOI growth (year over year)	12.6	%			9.4	%
Average Occupancy	98.1	%	98.1	%	98.2	%	97.5	%
Bad debt % of gross rental revenues ^(1)	1.1	%	2.4	%	1.5	%	1.6	%
Turnover Rate	4.6	%	5.7	%	22.9	%	26.4	%
Rental Rate Growth (lease-over-lease):
Renewals	9.0	%	3.8	%	6.7	%	3.7	%
New leases	17.3	%	6.8	%	14.4	%	4.2	%
Blended	11.1	%	4.8	%	8.8	%	3.8	%

(1)

Invitation Homes reserves residents' accounts receivables balances that are aged greater than 30 days as bad debt, under the rationale that a resident's security deposit should cover approximately the first 30 days of receivables. For all resident receivables balances aged greater than 30 days, the amount reserved as bad debt is 100% of outstanding receivables from the resident, less the amount of the resident's security deposit on hand. For the purpose of determining age of receivables, charges are considered to be due based on the terms of the original lease, not based on a payment plan if one is in place. All rental revenues and other property income, in both Total Portfolio and Same Store Portfolio presentations, are reflected net of bad debt.

Revenue Collections Update
	Q4 2021		Q3 2021		Q2 2021		Q1 2021		Pre-COVID Average ^(2)
Revenues collected % of revenues due: ^(1)
Revenues collected in same month billed	92	%	92	%	92	%	91	%	96	%
Late collections of prior month billings	6	%	5	%	6	%	6	%	3	%
Total collections	98	%	97	%	98	%	97	%	99	%

(1)	Includes both rental revenues and other property income. Rent is considered to be due based on the terms of the original lease, not based on a payment plan if one is in place. Security deposits retained to offset rents due are not included as revenue collected. See "Same Store Operating Results Snapshot," footnote (1), for detail on the Company's bad debt policy.
(2)	Represents the period from October 2019 to March 2020.

Same Store NOI

For the Same Store Portfolio of 72,245 homes, fourth quarter 2021 Same Store NOI increased 12.6% year over year on Same Store Core Revenues growth of 9.5% and Same Store Core Operating Expenses growth of 3.1%.

FY 2021 Same Store NOI increased 9.4% year over year on Same Store Core Revenues growth of 6.4% and Same Store Core Operating Expenses growth of 0.5%.

Same Store Core Revenues

Fourth quarter 2021 Same Store Core Revenues growth of 9.5% year over year was driven by a 7.1% increase in Average Monthly Rent, a 130 basis points year over year improvement in bad debt as a percentage of gross rental revenue, and a 53.6% increase in other income, net of resident recoveries.

FY 2021 Same Store Core Revenues growth of 6.4% year over year was driven by a 5.1% increase in Average Monthly Rent, a 70 basis point increase in Average Occupancy to 98.2%, and a 22.6% increase in other income, net of resident recoveries.

Same Store Core Operating Expenses

Fourth quarter 2021 Same Store Core Operating Expenses increased 3.1% year over year, driven by a 3.1% increase in Same Store fixed expense and a 12.6% increase in personnel expenses, partially offset by a 12.3% decline in turnover expenses, net of resident recoveries.

FY 2021 Same Store Core Operating Expenses increased 0.5% year over year, driven by a 2.9% increase in Same Store fixed expenses, partially offset by a 3.4% decline in Same Store controllable expenses, net of resident recoveries.

Investment Management Activity

Fourth quarter 2021 acquisitions totaled 1,543 homes for $656 million through diversified acquisition channels. This included 961 wholly owned homes for $420 million and 582 homes for $236 million in the Company's unconsolidated joint venture with the Rockpoint Group (the "Rockpoint JV"). Invitation Homes owns 20% of the Rockpoint JV, which owned a total of 2,004 homes as of December 31, 2021.

Dispositions in the fourth quarter of 2021 included 129 wholly owned homes for gross proceeds of $47 million and 10 homes for gross proceeds of $4 million in the Company's unconsolidated joint venture with the Federal National Mortgage Association (the "FNMA JV").

In FY 2021, the Company acquired 4,802 homes for $1,947 million, including 2,938 wholly owned homes for $1,229 million and 1,864 homes for $718 million in the Rockpoint JV. The Company also sold 783 homes for $263 million, including 734 wholly owned homes for $244 million and 49 homes for $19 million in the FNMA JV.

As previously announced, the Company has agreed to invest $250 million with Pathway Homes, a new real estate company that provides consumers multiple options to purchase a home. In addition to investing in the technology platform and homes for the startup and its real estate fund, Invitation Homes will provide maintenance and other services to all Pathway homes.

Balance Sheet and Capital Markets Activity

As of December 31, 2021, the Company had $1,610 million in available liquidity through a combination of unrestricted cash and undrawn capacity on its revolving credit facility. The Company's total indebtedness as of December 31, 2021 was $8,062 million, consisting of $4,591 million of unsecured debt and $3,471 million of secured debt.

As previously announced in November 2021, the Company closed a public bond offering of $1 billion aggregate principal balance, consisting of $600 million of bonds with a fixed coupon of 2.3% maturing on November 15, 2028 (the "November 2028 Notes") and $400 million of bonds with a fixed coupon of 2.7% maturing on January 15, 2034 (the "January 2034 Notes). The November 2028 Notes were priced at 99.871% of the principal amount, and the January 2034 Notes were priced at 99.809% of the principal amount. Net proceeds were used primarily to voluntarily prepay secured indebtedness and for general corporate purposes including acquisitions. As a result of the prepayment of secured indebtedness, 4,182 additional homes were unencumbered.

During Q4 2021, the Company issued 4.1 million shares of common stock under its 2019 at the market equity program (the "2019 ATM Equity Program") at an average price of $41.63 per share. Total gross proceeds of $169 million were used primarily to acquire homes. In December 2021, the Company terminated its 2019 ATM Equity Program and entered into a new at the market equity program (the "2021 ATM Equity Program") to sell, from time to time, up to an aggregate sales price of $1.25 billion of the Company's common stock through current and forward offerings. No shares were issued under the 2021 ATM Equity Program as of December 31, 2021.

On January 18, 2022, the Company settled the remaining $141 million principal balance of its 3.5% Convertible Notes due January 15, 2022 (the "2022 Convertible Notes") with the issuance of an additional 6,216,261 common shares.

Dividend

As previously announced on February 4, 2022, the Company's Board of Directors declared a quarterly cash dividend of $0.22 per share of common stock, representing a 29.4% increase over the prior quarterly dividend of $0.17 per share. The dividend will be paid on or before February 28, 2022, to stockholders of record as of the close of business on February 14, 2022.

FY 2022 Guidance

FY 2022 Guidance
	FY 2022			FY 2021
	Guidance			Actual
Core FFO per share — diluted	$1.62 - $1.70			$	1.49
AFFO per share — diluted	$1.38 - $1.46			$	1.28
Same Store Core Revenues growth	8.0% - 9.0%				6.4	%
Same Store Core Operating Expenses growth	5.5% - 6.5%				0.5	%
Same Store NOI growth	9.0% - 10.5%				9.4	%
Bridge from FY 2021 Results to FY 2022 Guidance Midpoint
	Core FFO/sh
FY 2021 reported result	$	1.49
Impact from Changes in:
Same Store NOI ^(1)		0.19
Non-Same Store NOI		0.09
Joint Venture Management Fees		0.02
Property management and G&A expense		(0.03	)
Interest expense ^(2)		0.01
Share count ^(2)		(0.09	)
Other		(0.02	)
Total change		0.17
FY 2022 guidance midpoint	$	1.66

(1)	Based on the 2022 Same Store pool, consisting of 75,700 homes as of January 2022.
(2)	Includes the impact from the conversions of the 2022 Convertible Notes.

Note: The Company does not provide guidance for the most comparable GAAP financial measures of net income (loss), total revenues, and property operating and maintenance expense, or a reconciliation of the forward-looking non-GAAP financial measures of Core FFO per share, AFFO per share, Same Store Core Revenues growth, Same Store Core Operating Expenses growth, and Same Store NOI growth to the comparable GAAP financial measures because it is unable to reasonably predict certain items contained in the GAAP measures, including non-recurring and infrequent items that are not indicative of the Company's ongoing operations. Such items include, but are not limited to, impairment on depreciated real estate assets, net (gain)/loss on sale of previously depreciated real estate assets, share-based compensation, casualty loss, non-Same Store revenues, and non-Same Store operating expenses. These items are uncertain, depend on various factors, and could have a material impact on the Company's GAAP results for the guidance period.

Earnings Conference Call Information

Invitation Homes has scheduled a conference call at 11:00 a.m. Eastern Time on February 16, 2022, to discuss results for the fourth quarter of 2021. The domestic dial-in number is 1-844-200-6205, and the international dial-in number is 1-929-526-1599. The passcode is 400967. An audio webcast may be accessed at www.invh.com. A replay of the call will be available through March 16, 2022, and can be accessed by calling 1-866-813-9403 (domestic) or 1-929-458-6194 (international) and using the replay passcode 341803, or by using the link at www.invh.com.

Supplemental Information

The full text of the Earnings Release and Supplemental Information referenced in this release are available on Invitation Homes' Investor Relations website at www.invh.com.

Glossary & Reconciliations of Non-GAAP Financial and Other Operating Measures

Financial and operating measures found in the Earnings Release and Supplemental Information include certain measures used by Invitation Homes management that are measures not defined under accounting principles generally accepted in the United States ("GAAP"). These measures are defined herein and, as applicable, reconciled to the most comparable GAAP measures.

About Invitation Homes

Invitation Homes is the nation's premier single-family home leasing company, meeting changing lifestyle demands by providing access to high-quality, updated homes with valued features such as close proximity to jobs and access to good schools. The company's mission, "Together with you, we make a house a home," reflects its commitment to providing homes where individuals and families can thrive and high-touch service that continuously enhances residents' living experiences.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which include, but are not limited to, statements related to the Company's expectations regarding the performance of the Company's business, its financial results, its liquidity and capital resources, and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “guidance,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks inherent to the single-family rental industry and the Company's business model, macroeconomic factors beyond the Company's control, competition in identifying and acquiring properties, competition in the leasing market for quality residents, increasing property taxes, homeowners’ association (“HOA”) fees, and insurance costs, the Company's dependence on third parties for key services, risks related to the evaluation of properties, poor resident selection and defaults and non-renewals by the Company's residents, performance of the Company's information technology systems, risks related to the Company's indebtedness, and risks related to the potential negative impact of the ongoing COVID-19 pandemic on the Company’s financial condition, results of operations, cash flows, business, associates, and residents. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Moreover, many of these factors have been heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. The Company believes these factors include, but are not limited to, those described under Part I. Item 1A. “Risk Factors” of the Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission (the "SEC"), as such factors may be updated from time to time in the Company's periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company's other periodic filings. The forward-looking statements speak only as of the date of this press release, and the Company expressly disclaims any obligation or undertaking to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except to the extent otherwise required by law.

Consolidated Balance Sheets
($ in thousands, except shares and per share data)
	December 31, 2021			December 31, 2020
	(unaudited)
Assets:
Investments in single-family residential properties, net	$	16,935,322		$	16,288,693
Cash and cash equivalents		610,166			213,422
Restricted cash		208,692			198,346
Goodwill		258,207			258,207
Investments in unconsolidated joint ventures		130,395			69,267
Other assets, net		395,064			478,287
Total assets	$	18,537,846		$	17,506,222
Liabilities:
Mortgage loans, net	$	3,055,853		$	4,820,098
Secured term loan, net		401,313			401,095
Unsecured notes, net		1,921,974			—
Term loan facility, net		2,478,122			2,470,907
Revolving facility		—			—
Convertible senior notes, net		141,397			339,404
Accounts payable and accrued expenses		193,633			149,299
Resident security deposits		165,167			157,936
Other liabilities		341,583			611,410
Total liabilities		8,699,042			8,950,149
Equity:
Stockholders' equity
Preferred stock, $0.01 par value per share, 900,000,000 shares authorized, none outstanding as of December 31, 2021 and 2020		—			—
Common stock, $0.01 par value per share, 9,000,000,000 shares authorized, 601,045,438 and 567,117,666 outstanding as of December 31, 2021 and 2020, respectively		6,010			5,671
Additional paid-in capital		10,873,539			9,707,258
Accumulated deficit		(794,869	)		(661,162	)
Accumulated other comprehensive loss		(286,938	)		(546,942	)
Total stockholders' equity		9,797,742			8,504,825
Non-controlling interests		41,062			51,248
Total equity		9,838,804			8,556,073
Total liabilities and equity	$	18,537,846		$	17,506,222

Consolidated Statements of Operations
($ in thousands, except shares and per share amounts)
	Q4 2021			Q4 2020			FY 2021			FY 2020
	(unaudited)			(unaudited)			(unaudited)
Revenues:
Rental revenues	$	475,436		$	429,866		$	1,826,768		$	1,687,724
Other property income		43,036			34,234			164,954			135,104
Joint venture management fees		1,753			—			4,893			—
Total revenues		520,225			464,100			1,996,615			1,822,828
Expenses:
Property operating and maintenance		177,883			168,628			706,162			680,543
Property management expense		20,173			14,888			71,597			58,613
General and administrative		19,668			16,679			75,815			63,305
Interest expense		79,121			95,382			322,661			353,923
Depreciation and amortization		151,660			142,090			592,135			552,530
Impairment and other		3,046			(3,974	)		8,676			696
Total expenses		451,551			433,693			1,777,046			1,709,610
Gains (losses) on investments in equity securities, net		(3,597	)		29,689			(9,420	)		29,723
Other, net		(2,654	)		(2,087	)		(5,835	)		(86	)
Gain on sale of property, net of tax		14,558			13,121			60,008			54,594
Income (loss) from investments in unconsolidated joint ventures		(2,110	)		—			(1,546	)		—
Net income		74,871			71,130			262,776			197,449
Net income attributable to non-controlling interests		(328	)		(431	)		(1,351	)		(1,237	)
Net income attributable to common stockholders		74,543			70,699			261,425			196,212
Net income available to participating securities		(67	)		(113	)		(327	)		(448	)
Net income available to common stockholders — basic and diluted	$	74,476		$	70,586		$	261,098		$	195,764
Weighted average common shares outstanding — basic		598,076,066			563,968,010			577,681,070			553,993,321
Weighted average common shares outstanding — diluted		599,827,368			565,541,098			579,209,523			555,458,607
Net income per common share — basic	$	0.12		$	0.13		$	0.45		$	0.35
Net income per common share — diluted	$	0.12		$	0.12		$	0.45		$	0.35
Dividends declared per common share	$	0.17		$	0.15		$	0.68		$	0.60

Glossary and Reconciliations

Average Monthly Rent

Average monthly rent represents average monthly rental income per home for occupied properties in an identified population of homes over the measurement period, and reflects the impact of non-service rental concessions and contractual rent increases amortized over the life of the lease.

Average Occupancy

Average occupancy for an identified population of homes represents (i) the total number of days that the homes in such population were occupied during the measurement period, divided by (ii) the total number of days that the homes in such population were owned during the measurement period.

Core Operating Expenses

Core operating expenses for an identified population of homes reflect property operating and maintenance expenses, excluding any expenses recovered from residents.

Core Revenues

Core revenues for an identified population of homes reflects total revenues, net of any resident recoveries.

EBITDA, EBITDAre, and Adjusted EBITDAre

EBITDA, EBITDAre, and Adjusted EBITDAre are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. The Company defines EBITDA as net income or loss computed in accordance with accounting principles generally accepted in the United States (“GAAP”) before the following items: interest expense; income tax expense; depreciation and amortization; and adjustments for unconsolidated joint ventures. National Association of Real Estate Investment Trusts ("Nareit") recommends as a best practice that REITs that report an EBITDA performance measure also report EBITDAre. The Company defines EBITDAre, consistent with the Nareit definition, as EBITDA, further adjusted for gain on sale of property, net of tax and impairment on depreciated real estate investments. Adjusted EBITDAre is defined as EBITDAre before the following items: share-based compensation expense; severance; casualty (gains) losses, net; (gains) losses on investments in equity securities, net; and other income and expenses. EBITDA, EBITDAre, and Adjusted EBITDAre are used as supplemental financial performance measures by management and by external users of the Company's financial statements, such as investors and commercial banks. Set forth below is additional detail on how management uses EBITDA, EBITDAre, and Adjusted EBITDAre as measures of performance.

The GAAP measure most directly comparable to EBITDA, EBITDAre, and Adjusted EBITDAre is net income or loss. EBITDA, EBITDAre, and Adjusted EBITDAre are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's EBITDA, EBITDAre, and Adjusted EBITDAre may not be comparable to the EBITDA, EBITDAre, and Adjusted EBITDAre of other companies due to the fact that not all companies use the same definitions of EBITDA, EBITDAre, and Adjusted EBITDAre. Accordingly, there can be no assurance that the Company's basis for computing these non-GAAP measures is comparable with that of other companies. See below for a reconciliation of GAAP net income to EBITDA, EBITDAre, and Adjusted EBITDAre.

Funds from Operations (FFO), Core Funds from Operations (Core FFO), and Adjusted Funds from Operations (AFFO)

FFO, Core FFO, and Adjusted FFO are supplemental, non-GAAP measures often utilized to evaluate the performance of real estate companies. FFO is defined by Nareit as net income or loss (computed in accordance with GAAP) excluding gains or losses from sales of previously depreciated real estate assets, plus depreciation, amortization and impairment of real estate assets, and adjustments for unconsolidated joint ventures. In calculating per share amounts, Core FFO and AFFO reflect convertible debt securities in the form in which they were outstanding during the period.

The Company believes that FFO is a meaningful supplemental measure of the operating performance of its business because historical cost accounting for real estate assets in accordance with GAAP assumes that the value of real estate assets diminishes predictably over time, as reflected through depreciation and amortization. Because real estate values have historically risen or fallen with market conditions, management considers FFO an appropriate supplemental performance measure as it excludes historical cost depreciation and amortization, impairment on depreciated real estate investments, gains or losses related to sales of previously depreciated homes, as well non-controlling interests, from GAAP net income or loss.

The GAAP measure most directly comparable to Core FFO and Adjusted FFO is net income or loss. Core FFO and Adjusted FFO are not used as measures of the Company's liquidity and should not be considered alternatives to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's Core FFO and Adjusted FFO may not be comparable to the Core FFO and Adjusted FFO of other companies due to the fact that not all companies use the same definition of Core FFO and Adjusted FFO. Accordingly, there can be no assurance that the Company's basis for computing this non-GAAP measures is comparable with that of other companies. See "Reconciliation of FFO, Core FFO, and Adjusted FFO" for a reconciliation of GAAP net income to FFO, Core FFO, and Adjusted FFO.

Net Operating Income (NOI)

NOI is a non-GAAP measure often used to evaluate the performance of real estate companies. The Company defines NOI for an identified population of homes as rental revenues and other property income less property operating and maintenance expense (which consists primarily of property taxes, insurance, HOA fees (when applicable), market-level personnel expenses, repairs and maintenance, leasing costs, and marketing expense). NOI excludes: interest expense; depreciation and amortization; property management expense; general and administrative expense; impairment and other; gain on sale of property, net of tax; (gains) losses on investments in equity securities, net; other income and expenses; joint venture management fees; and income from investments in unconsolidated joint ventures.

The GAAP measure most directly comparable to NOI is net income or loss. NOI is not used as a measure of liquidity and should not be considered as an alternative to net income or loss or any other measure of financial performance presented in accordance with GAAP. The Company's NOI may not be comparable to the NOI of other companies due to the fact that not all companies use the same definition of NOI. Accordingly, there can be no assurance that the Company's basis for computing this non-GAAP measure is comparable with that of other companies.

The Company believes that Same Store NOI is also a meaningful supplemental measure of the Company's operating performance for the same reasons as NOI and is further helpful to investors as it provides a more consistent measurement of the Company's performance across reporting periods by reflecting NOI for homes in its Same Store Portfolio.

See below for a reconciliation of GAAP net income to NOI for the Company's total portfolio and NOI for its Same Store Portfolio.

Recurring Capital Expenditures or Recurring CapEx

Recurring Capital Expenditures or Recurring CapEx represents general replacements and expenditures required to preserve and maintain the value and functionality of a home and its systems as a single-family rental.

Rental Rate Growth

Rental rate growth for any home represents the percentage difference between the monthly rent from an expiring lease and the monthly rent from the next lease, and, in each case, reflects the impact of any amortized non-service rent concessions and amortized contractual rent increases. Leases are either renewal leases, where the Company's current resident chooses to stay for a subsequent lease term, or a new lease, where the Company's previous resident moves out and a new resident signs a lease to occupy the same home.

Revenue Collections

Revenue collections represent the total cash received in a given period for rental revenues and other property income (including receipt of late payments that were billed in prior months) divided by the total amounts billed in that period. When a payment plan is in place with a resident, amounts are considered to be billed at the time they would have been billed based on the terms of the original lease, not the terms of the payment plan. "Historical average" revenue collections as a percentage of billings refer to revenue collections as a percentage of billings for the period from October 2019 through and including March 2020.

Same Store / Same Store Portfolio

Same Store or Same Store portfolio includes, for a given reporting period, wholly owned homes that have been stabilized and seasoned, excluding homes that have been sold, homes that have been identified for sale to an owner occupant and have become vacant, homes that have been deemed inoperable or significantly impaired by casualty loss events or force majeure, homes acquired in portfolio transactions that are deemed not to have undergone renovations of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio, and homes in markets that the Company has announced an intent to exit where the Company no longer operates a significant number of homes.

Homes are considered stabilized if they have (i) completed an initial renovation and (ii) entered into at least one post-initial renovation lease. An acquired portfolio that is both leased and deemed to be of sufficiently similar quality and characteristics as the existing Invitation Homes Same Store portfolio may be considered stabilized at the time of acquisition.

Homes are considered to be seasoned once they have been stabilized for at least 15 months prior to January 1^st of the year in which the Same Store portfolio was established.

The Company believes presenting information about the portion of its portfolio that has been fully operational for the entirety of a given reporting period and its prior year comparison period provides investors with meaningful information about the performance of the Company's comparable homes across periods and about trends in its organic business.

Total Homes / Total Portfolio

Total homes or total portfolio refers to the total number of homes owned, whether or not stabilized, and excludes any properties previously acquired in purchases that have been subsequently rescinded or vacated. Unless otherwise indicated, total homes or total portfolio refers to the wholly owned homes and excludes homes owned in joint ventures.

Turnover Rate

Turnover rate represents the number of instances that homes in an identified population become unoccupied in a given period, divided by the number of homes in such population.

Reconciliation of FFO, Core FFO, and AFFO
($ in thousands, except shares and per share amounts) (unaudited)
FFO Reconciliation	Q4 2021			Q4 2020			FY 2021			FY 2020
Net income available to common stockholders	$	74,476		$	70,586		$	261,098		$	195,764
Net income available to participating securities		67			113			327			448
Non-controlling interests		328			431			1,351			1,237
Depreciation and amortization on real estate assets		149,753			140,341			585,101			546,419
Impairment on depreciated real estate investments		—			376			650			4,578
Net gain on sale of previously depreciated investments in real estate		(14,558	)		(13,121	)		(60,008	)		(54,594	)
Depreciation and net gain on sale of investments in unconsolidated joint ventures		315			—			254			—
FFO	$	210,381		$	198,726		$	788,773		$	693,852
Core FFO Reconciliation	Q4 2021			Q4 2020			FY 2021			FY 2020
FFO	$	210,381		$	198,726		$	788,773		$	693,852
Non-cash interest expense, including the Company's share from unconsolidated joint ventures		8,729			13,775			34,520			40,415
Share-based compensation expense		6,098			4,797			27,170			17,090
Severance expense		557			213			1,057			601
Casualty (gains) losses, net		3,046			(4,350	)		8,026			(3,882	)
(Gains) losses on investments in equity securities, net		3,597			(29,689	)		9,420			(29,723	)
Core FFO	$	232,408		$	183,472		$	868,966		$	718,353
AFFO Reconciliation	Q4 2021			Q4 2020			FY 2021			FY 2020
Core FFO	$	232,408		$	183,472		$	868,966		$	718,353
Recurring capital expenditures, including the Company's share from unconsolidated joint ventures		(33,968	)		(28,485	)		(123,405	)		(115,951	)
Adjusted FFO	$	198,440		$	154,987		$	745,561		$	602,402
Net income available to common stockholders
Weighted average common shares outstanding — diluted ^(1)		599,827,368			565,541,098			579,209,523			555,458,607
Net income per common share — diluted ^(1)	$	0.12		$	0.12		$	0.45		$	0.35
FFO
Numerator for FFO per common share — diluted^(1)	$	212,214		$	203,037		$	803,137		$	711,033
Weighted average common shares and OP Units outstanding — diluted ^(1)		611,140,145			584,506,076			593,735,669			574,408,346
FFO per share — diluted ^(1)	$	0.35		$	0.35		$	1.35		$	1.24
Core FFO and Adjusted FFO
Weighted average common shares and OP Units outstanding — diluted ^(2)		602,631,795			569,405,633			582,442,466			559,307,903
Core FFO per share — diluted ^(2)	$	0.39		$	0.32		$	1.49		$	1.28
AFFO per share — diluted ^(2)	$	0.33		$	0.27		$	1.28		$	1.08

(1)	During Q4 2021 and FY 2021, at the election of the noteholders, the Company settled $5 million and $204 million of principal balance outstanding of the 2022 Convertible Notes with the issuance of 219,953 and 8,943,374 shares of its common stock, respectively. For the period subsequent to such conversion dates, shares issued in connection with any settled conversions of the 2022 Convertible Notes are included within weighted shares outstanding and therefore impact diluted per share information.
	In accordance with GAAP and Nareit guidelines, net income per share — diluted and FFO per share — diluted include the effect of shares issuable in respect of the 2022 Convertible Notes if such shares are dilutive to the calculation.
	In Q4 2021 and Q4 2020, the effect of the shares issuable in respect of the 2022 Convertible Notes is anti-dilutive to net income per share and dilutive to FFO per share. As such, net income per share is not adjusted for conversion of the 2022 Convertible Notes during these periods, and FFO per share considers the dilutive effect of the 2022 Convertible Notes by removing the related interest expense from the numerator and increasing the denominator to include shares issuable on conversion of the 2022 Convertible Notes.
	In FY 2021 and FY 2020, the effect of the shares issuable in respect of the 2022 Convertible Notes is anti-dilutive to net income per share and dilutive to FFO per share. As such, net income per share is not adjusted for conversion of the 2022 Convertible Notes during these periods, and FFO per share considers the dilutive effect of the 2022 Convertible Notes by removing the related interest expense from the numerator and increasing the denominator to include shares issuable on conversion of the 2022 Convertible Notes.
(2)	Core FFO and AFFO per share reflect the 2022 Convertible Notes in the form in which they were outstanding during each period. As such, Core FFO and AFFO per share do not treat the outstanding 2022 Convertible Notes as if converted for each of the periods presented.

Reconciliation of Total Revenues to Same Store Core Revenues, Quarterly
(in thousands) (unaudited)
	Q4 2021			Q3 2021			Q2 2021			Q1 2021			Q4 2020
Total revenues (Total Portfolio)	$	520,225		$	509,532		$	491,633		$	475,225		$	464,100
Joint venture management fees		(1,753	)		(1,354	)		(1,015	)		(771	)		—
Total portfolio resident recoveries		(26,967	)		(27,972	)		(26,076	)		(24,740	)		(23,885	)
Total Core Revenues (Total Portfolio)		491,505			480,206			464,542			449,714			440,215
Non-Same Store Core Revenues		(50,345	)		(47,814	)		(44,850	)		(40,892	)		(37,332	)
Same Store Core Revenues	$	441,160		$	432,392		$	419,692		$	408,822		$	402,883
Reconciliation of Total Revenues to Same Store Core Revenues, FY
(in thousands) (unaudited)
	FY 2021			FY 2020
Total revenues (Total Portfolio)	$	1,996,615		$	1,822,828
Joint venture management fees		(4,893	)		—
Total Portfolio resident recoveries		(105,755	)		(87,758	)
Total Core Revenues (Total Portfolio)		1,885,967			1,735,070
Non-Same Store Core Revenues		(183,901	)		(135,804	)
Same Store Core Revenues	$	1,702,066		$	1,599,266

Reconciliation of Property Operating and Maintenance Expenses to Same Store Core Operating Expenses, Quarterly
(in thousands) (unaudited)
	Q4 2021			Q3 2021			Q2 2021			Q1 2021			Q4 2020
Property operating and maintenance expenses (Total Portfolio)	$	177,883		$	184,484		$	175,422		$	168,373		$	168,628
Total Portfolio resident recoveries		(26,967	)		(27,972	)		(26,076	)		(24,740	)		(23,885	)
Core Operating Expenses (Total Portfolio)		150,916			156,512			149,346			143,633			144,743
Non-Same Store Core Operating Expenses		(14,939	)		(14,187	)		(14,045	)		(12,786	)		(12,890	)
Same Store Core Operating Expenses	$	135,977		$	142,325		$	135,301		$	130,847		$	131,853
Reconciliation of Property Operating and Maintenance Expenses to Same Store Core Operating Expenses, FY
(in thousands) (unaudited)
	FY 2021			FY 2020
Property operating and maintenance expenses (Total Portfolio)	$	706,162		$	680,543
Total Portfolio resident recoveries		(105,755	)		(87,758	)
Core Operating Expenses (Total Portfolio)		600,407			592,785
Non-Same Store Core Operating Expenses		(55,957	)		(51,296	)
Same Store Core Operating Expenses	$	544,450		$	541,489

Reconciliation of Net Income to Same Store NOI, Quarterly
(in thousands) (unaudited)
	Q4 2021			Q3 2021			Q2 2021			Q1 2021			Q4 2020
Net income available to common stockholders	$	74,476		$	69,108		$	60,242		$	57,272		$	70,586
Net income available to participating securities		67			69			96			95			113
Non-controlling interests		328			318			350			355			431
Interest expense		79,121			79,370			80,764			83,406			95,382
Depreciation and amortization		151,660			150,694			145,280			144,501			142,090
Property management expense		20,173			17,886			17,696			15,842			14,888
General and administrative		19,668			19,369			19,828			16,950			16,679
Impairment and other		3,046			4,294			980			356			(3,974	)
Gain on sale of property, net of tax		(14,558	)		(13,047	)		(17,919	)		(14,484	)		(13,121	)
(Gains) losses on investments in equity securities, net		3,597			(4,319	)		7,002			3,140			(29,689	)
Other, net		2,654			1,508			1,903			(230	)		2,087
Joint venture management fees		(1,753	)		(1,354	)		(1,015	)		(771	)		—
(Income) loss from investments in unconsolidated joint ventures		2,110			(202	)		(11	)		(351	)		—
NOI (Total Portfolio)		340,589			323,694			315,196			306,081			295,472
Non-Same Store NOI		(35,406	)		(33,627	)		(30,805	)		(28,106	)		(24,442	)
Same Store NOI	$	305,183		$	290,067		$	284,391		$	277,975		$	271,030
Reconciliation of Net Income to Same Store NOI, FY
(in thousands) (unaudited)
	FY 2021			FY 2020
Net income available to common stockholders	$	261,098		$	195,764
Net income available to participating securities		327			448
Non-controlling interests		1,351			1,237
Interest expense		322,661			353,923
Depreciation and amortization		592,135			552,530
Property management expense		71,597			58,613
General and administrative		75,815			63,305
Impairment and other		8,676			696
Gain on sale of property, net of tax		(60,008	)		(54,594	)
(Gains) losses on investments in equity securities, net		9,420			(29,723	)
Other, net		5,835			86
Joint venture management fees		(4,893	)		—
Loss from investments in unconsolidated joint ventures		1,546			—
NOI (Total Portfolio)		1,285,560			1,142,285
Non-Same Store NOI		(127,944	)		(84,508	)
Same Store NOI	$	1,157,616		$	1,057,777

Reconciliation of Net Income to EBITDA, EBITDAre, and Adjusted EBITDAre
(in thousands, unaudited)
	Q4 2021			Q4 2020			FY 2021			FY 2020
Net income available to common stockholders	$	74,476		$	70,586		$	261,098		$	195,764
Net income available to participating securities		67			113			327			448
Non-controlling interests		328			431			1,351			1,237
Interest expense		79,121			95,382			322,661			353,923
Interest expense in unconsolidated joint ventures		540			—			1,209			—
Depreciation and amortization		151,660			142,090			592,135			552,530
Depreciation and amortization of real estate assets in unconsolidated joint ventures		565			—			1,304			—
EBITDA		306,757			308,602			1,180,085			1,103,902
Gain on sale of property, net of tax		(14,558	)		(13,121	)		(60,008	)		(54,594	)
Impairment on depreciated real estate investments		—			376			650			4,578
Net gain on sale of investments in unconsolidated joint ventures		(250	)		—			(1,050	)		—
EBITDAre		291,949			295,857			1,119,677			1,053,886
Share-based compensation expense		6,098			4,797			27,170			17,090
Severance		557			213			1,057			601
Casualty (gains) losses, net		3,046			(4,350	)		8,026			(3,882	)
(Gains) losses on investments in equity securities, net		3,597			(29,689	)		9,420			(29,723	)
Other, net		2,654			2,087			5,835			86
Adjusted EBITDAre	$	307,901		$	268,915		$	1,171,185		$	1,038,058

Reconciliation of Net Debt / Trailing Twelve Months (TTM) Adjusted EBITDAre
(in thousands, except for ratio) (unaudited)
	As of			As of
	December 31, 2021			December 31, 2020
Mortgage loans, net	$	3,055,853		$	4,820,098
Secured term loan, net		401,313			401,095
Unsecured notes, net		1,921,974			—
Term loan facility, net		2,478,122			2,470,907
Revolving facility		—			—
Convertible senior notes, net		141,397			339,404
Total Debt per Balance Sheet		7,998,659			8,031,504
Retained and repurchased certificates		(159,110	)		(247,526	)
Cash, ex-security deposits and letters of credit ^(1)		(649,722	)		(250,204	)
Deferred financing costs, net		50,146			43,396
Unamortized discounts on note payable		13,605			7,885
Net Debt (A)	$	7,253,578		$	7,585,055
	For the Trailing Twelve			For the Trailing Twelve
	Months (TTM) Ended			Months (TTM) Ended
	December 31, 2021			December 31, 2020
Adjusted EBITDAre (B)	$	1,171,185		$	1,038,058
Net Debt / TTM Adjusted EBITDAre (A / B)		6.2x			7.3x

(1)	Represents cash and cash equivalents and the portion of restricted cash that excludes security deposits and letters of credit