INDEPENDENCE REALTY TRUST, INC.

Previous wording

Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help provide an understanding of our business, financial condition and results of operations. This MD&A should be read in conjunction with our Consolidated Financial Statements and the accompanying Notes to Consolidated Financial Statements included elsewhere in this report. This report, including the following MD&A, contains forward-looking statements regarding future events or trends that are intended to be made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Current wording

Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to help provide an understanding of our business, financial condition and results of operations. This MD&A should be read in conjunction with our Consolidated Financial Statements and the accompanying Notes to Consolidated Financial Statements included elsewhere in this Annual Report. This Annual Report, including the following MD&A, contains forward-looking statements regarding future events or trends that are intended to be made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Previous wording

Rental and other property revenue. Rental and other property revenue decreased $20.9 million to $638.9 million for the year ended December 31, 2024 from $659.8 million for the year ended December 31, 2023. The decrease was primarily attributable to a $38.2 million decrease in non same-store rental and other property revenue driven by the sale of ten properties under the Portfolio Optimization and Deleveraging Strategy. This decrease in non same-store rental and other property revenue was partially offset by an increase in same-store rental and other property revenue of $17.3 million driven by a 1.3% increase in average effective monthly rents and a 1.1% increase in average occupancy compared to the prior year period.

Current wording

*Rental and other property revenue.*Rental and other property revenue increased $17.6 million to $656.5 million for the year ended December 31, 2025 from $638.9 million for the year ended December 31, 2024. The increase was primarily attributable to a $10.2 million increase in same-store rental and other property revenue, driven by a 0.8% increase in average effective monthly rents and a 0.3% increase in average occupancy compared to the prior year period and to a $7.4 million increase in non same-store rental and other property revenue driven by the acquisition of three properties in the second half of 2024, and three properties in 2025.

Previous wording

Property operating expenses. Property operating expenses decreased $8.7 million to $235.6 million for the year ended December 31, 2024 from $244.3 million for the year ended December 31, 2023. The decrease was primarily due to a $14.0 million decrease in non same-store property operating expenses, due to the sale of ten properties under our Portfolio Optimization and Deleveraging Strategy partially offset by a $5.3 million increase in same-store property operating expenses primarily due to higher personnel expenses, utilities, advertising, and property insurance, partially offset by a decrease in real estate taxes. Same-store advertising expenses increased 19.5% during the year ended December 31, 2024 compared to the prior year period, as we increased investment in our brand.

Current wording

Property operating expenses. Property operating expenses increased $3.6 million to $239.2 million for the year ended December 31, 2025 from $235.6 million for the year ended December 31, 2024. The increase was primarily due to a $2.5 million increase in non same-store property operating expenses, due to the acquisition of three properties in the second half of 2024 and three properties in 2025 and by a $1.1 million increase in same-store property operating expenses primarily due to higher advertising expense, contract services (landscaping, trash, cable/internet, janitorial), and utilities costs, partially offset by a decrease in property insurance, turnover costs, payroll expense and real estate taxes.

Previous wording

Depreciation and amortization expense. Depreciation and amortization expense increased $1.9 million to $220.9 million for the year ended December 31, 2024 from $219.0 million for the year ended December 31, 2023. The increase was primarily due to higher intangible asset amortization expenses during the year ended December 31, 2024, compared to the prior year. This was partially offset by lower depreciation expenses from properties sold in 2024.

Current wording

Depreciation and amortization expense. Depreciation and amortization expense increased $22.4 million to $243.2 million for the year ended December 31, 2025 from $220.9 million for the year ended December 31, 2024. The increase was primarily due to depreciation expenses driven by capital expenditures related to our Value Add Initiative and higher intangible asset amortization expenses from our property acquisitions in 2025, compared to the prior year period. This was partially offset by lower depreciation expenses from the sale of seven properties in 2024 compared to the sale of two properties in 2025.

Previous wording

(Loss on impairment) gain on sale of real estate assets, net. During the year ended December 31, 2024, we sold seven multifamily properties resulting in a gain on sale of $11.1 million. In addition, as of December 31, 2024, we identified one multifamily property as held for sale and recorded a loss on impairment of $21.0 million as a result of the carrying value of the real estate exceeding the expected sales price, less transaction costs. During the year ended December 31, 2023, we sold five multifamily properties resulting in a loss on impairment of $33.5 million. In addition, as of December 31, 2023, we identified six multifamily properties as held for sale and recorded a loss on impairment of $33.0 million as a result of the carrying value of the real estate exceeding the expected sales price, less transaction costs.

Current wording

Gain on sale (loss on impairment) of real estate assets, net. During the year ended December 31, 2025, we sold two multifamily properties, recognizing a gain on sale of $19.0 million in connection with one of the properties and an impairment loss of $12.8 million in connection with one property held for sale. During the year ended December 31, 2024, we sold seven multifamily properties, resulting in an aggregate gain on sale of $11.1 million. In addition, as of December 31, 2024, we identified one multifamily property as held for sale and recorded a loss on impairment of $21.0 million as a result of the carrying value of the real estate exceeding the expected sales price, less transaction costs.

Previous wording

CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash or non-operating gains or losses related to items such as casualty (gains) losses, loan premium accretion and discount amortization, debt extinguishment costs, merger and integration costs, and restructuring costs from the determination of FFO.

Current wording

CFFO is a computation made by analysts and investors to measure a real estate company’s operating performance by removing the effect of items that do not reflect ongoing property operations, including depreciation and amortization of other items not included in FFO, and other non-cash or non-operating gains or losses related to items such as casualty (gains) losses, loan premium accretion and discount amortization, debt extinguishment costs and restructuring costs from the determination of FFO.

Previous wording

We believe that Net Operating Income (“NOI”), a non-GAAP financial measure, is a useful supplemental measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expenses, depreciation and amortization, casualty related costs and gains, property management expenses, general and administrative expense, net gains on sale of assets, merger and integration costs, and restructuring costs. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income insofar as the measure reflects only operating income and expense at the property level. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses, financing expenses, and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as an alternative measure of our financial performance.

Current wording

We believe that Net Operating Income (“NOI”), a non-GAAP financial measure, is a useful supplemental measure of our operating performance. We define NOI as total property revenues less total property operating expenses, excluding interest expenses, depreciation and amortization, casualty related costs and gains, property management expenses, general and administrative expense, net gains on sale of assets, and restructuring costs. Other REITs may use different methodologies for calculating NOI, and accordingly, our NOI may not be comparable to other REITs. We believe that this measure provides an operating perspective not immediately apparent from GAAP operating income or net income insofar as the measure reflects only operating income and expense at the property level. We use NOI to evaluate our performance on a same-store and non same-store basis because NOI measures the core operations of property performance by excluding corporate level expenses, financing expenses, and other items not related to property operating performance and captures trends in rental housing and property operating expenses. However, NOI should only be used as an alternative measure of our financial performance.

Previous wording

Set forth below is a reconciliation of GAAP net income (loss) to Same-Store Portfolio(a) NOI for the years ended December 31, 2024 and 2023 (in thousands):

Current wording

Set forth below is a reconciliation of GAAP net income to Same-Store Portfolio(a) NOI for the years ended December 31, 2025 and 2024 (in thousands):

Previous wording

Set forth below is Same-Store Portfolio(a) NOI for the years ended December 31, 2024 and 2023 (in thousands, except per unit data):

Current wording

Set forth below is Same-Store Portfolio (a) NOI for the years ended December 31, 2025 and 2024 (in thousands, except per unit data):

Previous wording

On May 18, 2022, our Board of Directors authorized a common stock repurchase program (the “Stock Repurchase Program”) covering up to $250 million in shares of our common stock. Under the Stock Repurchase Program, we, in our discretion, may purchase our shares from time to time in the open market or in privately negotiated transactions. The amount and timing of the purchases will depend on a number of factors, including the price and availability of our shares, trading volumes and general market conditions. The Stock Repurchase Program has no time limit and may be suspended or discontinued at any time. During the year ended December 31, 2024, we had no repurchases of shares under the Stock Repurchase Program.

Current wording

On May 18, 2022, our Board of Directors authorized a common stock repurchase program (the “Stock Repurchase Program”) covering up to $250.0 million in shares of our common stock. Under the Stock Repurchase Program, we, in our discretion, may purchase our shares from time to time in the open market or in privately negotiated transactions. The amount and timing of the purchases will depend on a number of factors, including the price and availability of our shares, trading volumes and general market conditions. The Stock Repurchase Program has no time limit and may be suspended or discontinued at any time. During the year ended December 31, 2025, we repurchased and retired 1.9 million shares of our common stock at a weighted average price of $16.00 per share, at a total cost of $30.0 million. As of December 31, 2025, $220.0 million in shares of our common stock remained authorized for repurchase under our Stock Repurchase Program.

Previous wording

As of December 31, 2024 and 2023, we maintained cash, cash equivalents, and restricted cash of approximately $43.5 million and $50.7 million, respectively. Our cash and cash equivalents were generated from the following activities (dollars in thousands):

Current wording

As of December 31, 2025 and 2024, we maintained cash, cash equivalents, and restricted cash of approximately $47.6 million and $43.5 million, respectively. Our cash and cash equivalents were generated from the following activities (dollars in thousands):

Previous wording

Our cash flows provided by operating activities during the years ended December 31, 2024, 2023 and 2022 were primarily driven by the ongoing operations of our properties.

Current wording

Our cash flows provided by operating activities during the years ended December 31, 2025, 2024 and 2023 were primarily driven by the ongoing operations of our properties. For the year ended December 31, 2025, the $22.4 million increase in cash inflows from operating activities was primarily driven by returns from our ongoing operations, a decrease in cash paid for real estate taxes due to the timing of property acquisitions and dispositions.

Previous wording

Our cash flows used in investing activities during the year ended December 31, 2022 were primarily driven by $201.8 million of outflows related to the acquisitions of three multifamily apartment communities, $84.0 million of capital expenditures, $61.8 million in additions to real estate under development, and $60.8 million of outflows related to our investment in five unconsolidated real estate entities, partially offset by $253.6 million of inflows from property dispositions and $15.6 million in proceeds from insurance claims.

Current wording

Our cash flows used in investing activities during the year ended December 31, 2025 were primarily driven by $152.7 million of outflows related to the acquisitions of three multifamily apartment communities, $135.6 million of capital expenditures, $35.7 million of outflows related to payments to fund our investments in our unconsolidated real estate entities and $18.2 million in additions to real estate under development, partially offset by $157.9 million of inflows from property dispositions and $40.5 million of inflows from returns of investments in unconsolidated real estate entities.

Previous wording

Our cash flows used in investing activities during the year ended December 31, 2024 were primarily driven by $238.6 million of outflows related to the acquisitions of three multifamily apartment communities, $118.3 million of capital expenditures, $56.8 million in additions to real estate under development, and $11.6 million of outflows related to our investments in four unconsolidated real estate entities, partially offset by $390.9 million of inflows from property dispositions, $9.1 million in return of investments in unconsolidated real estate entities and $4.7 million in proceeds from insurance claims.

Current wording

Our cash flows used in investing activities during the year ended December 31, 2024 were primarily driven by $238.6 million of outflows related to the acquisitions of three multifamily apartment communities, $118.3 million of capital expenditures, $56.8 million in additions to real estate under development, and $11.6 of outflows related to payments to fund our investments in four unconsolidated real estate entities, partially offset by $390.9 million of inflows from property dispositions, $9.1 million in return of investments in unconsolidated real estate entities and $4.7 million in proceeds from insurance claims.

Previous wording

Our cash flows used in financing activities during the year ended December 31, 2022 were primarily driven by distributions on our common stock of $105.8 million, and mortgage principal repayments of $53.4 million partially offset by proceeds from the issuance of common stock of $48.7 million.

Current wording

Our cash flows used in financing activities during the year ended December 31, 2025 were primarily driven by distributions of $158.3 million, mortgage principal repayments of $100.7 million and repurchases of common stock under our Share Repurchase Program of $30.0 million, partially offset by $162.4 million of proceeds from the issuance of common stock in connection with our public offering of an aggregate of 11.5 million shares of our common stock discussed below.

Previous wording

Our cash flows used in financing activities during the year ended December 31, 2024 were primarily driven by mortgage principal repayments of $314.1 million, distributions of $147.8 million, and repayments under our credit facilities, net of new borrowings of $40.7 million, partially offset by $150.0 million of proceeds from our private placement of unsecured notes, and $111.3 million of proceeds from the issuance of common stock in connection with our recent public equity offering.

Current wording

Our cash flows used in financing activities during the year ended December 31, 2024 were primarily driven by mortgage principal repayments of $314.1 million, distributions of $147.8 million, and repayments under our credit facilities, net of new borrowings of $40.7 million, partially offset by $150.0 million of proceeds from our private placement of unsecured notes, and $111.3 million of proceeds from the issuance of common stock in connection with our public offering of an aggregate of 11.5 million shares of our common stock discussed below.

Previous wording

On January 8, 2025, IROP entered into the Fifth Amended and Restated Credit Agreement (the “Fifth Restated Credit Agreement”) by and among IROP, as borrower, IRT as parent guarantor, KeyBank National Association, as administrative agent, and the other agents and lender parties thereto,which amended and restated in its entirety the Fourth Amended and Restated Credit Agreement dated as of July 25, 2022 (the “Fourth Restated Credit Agreement”). The Fourth Restated Credit Agreement provided for a $500.0 million unsecured revolving credit facility (the “Unsecured Revolver”) with a January 31, 2026 scheduled maturity date and two unsecured term loans, specifically: (i) a $200.0 million term loan with a May 18, 2026 maturity date (the “2026 Term Loan”) and (ii) a $400.0 million term loan with a January 28, 2028 maturity date (the “2028 Term Loan”). The Fifth Restated Credit Agreement increases the maximum principal amount of the Unsecured Revolver to $750.0 million, which represents an increase of $250.0 million over the Fourth Restated Credit Agreement, and extends its maturity date until January 8, 2029. The Fifth Restated Credit Agreement also releases the Subsidiary Guarantors which were parties to the Fourth Restated Credit Agreement.

Current wording

On February, 11, 2026, IROP entered into the Sixth Amended and Restated Credit Agreement (the “Sixth Restated Credit Agreement”) by and among IROP, as borrower, IRT as parent guarantor, KeyBank National Association, as administrative agent, and the other agents and lender parties thereto, which amended and restated in its entirety the Fifth Amended and Restated Credit Agreement dated as of January 8, 2025 (the “Fifth Restated Credit Agreement”). The Fifth Restated Credit Agreement provided for a $750.0 million unsecured revolving credit facility (the “Unsecured Revolver”) with a January 8, 2029 scheduled maturity date and two unsecured term loans, specifically: (i) a $200.0 million term loan with a May 18, 2026 maturity date (the “2026 Term Loan”) and (ii) a $400.0 million term loan with a January 28, 2028 maturity date (the “2028 Term Loan”). The Sixth Restated Credit Agreement provides for a new $350.0 million term loan with a maturity date of February 11, 2030, subject to a one year extension option (the “2030 Term Loan”). A portion of the proceeds from the 2030 Term Loan were used to pay off outstanding borrowings under the 2026 Term Loan.

Previous wording

The Fifth Restated Credit Agreement increases the aggregate amount of borrowings under the credit agreement to $1.35 billion and permits IROP to request an increase in such aggregate amount to up to $2.0 billion subject to certain terms and conditions, including receipt of commitments from one or more lenders, whether or not currently parties to the Fifth Restated Credit Agreement, to provide such increased amounts, which increase may be allocated, at IROP’s option, to the Unsecured Revolver and/or to one or more of the Term Loans, in accordance with the Restated Credit Agreement.

Current wording

The Sixth Restated Credit Agreement also increases the aggregate amount of borrowings under the credit agreement to $1.5 billion and permits IROP to request an increase in such aggregate amount to up to $2.0 billion subject to certain terms and conditions, including receipt of commitments from one or more lenders, whether or not currently parties to the Sixth Restated Credit Agreement, to provide such increased amounts, which increase may be allocated, at IROP’s option, to the Unsecured Revolver and/or to one or more of the Term Loans, in accordance with the Sixth Restated Credit Agreement.

Previous wording

Borrowings under the 2026 Term Loan bear interest at a rate equal to either (i) the SOFR rate plus a margin of 80 to 160 basis points, or (ii) a base rate plus a margin of 0 to 60 basis points. These margins represent a 5-basis point decrease from those applicable to the 2026 Term Loan. The margin for borrowings under the Unsecured Revolver and the 2028 Term Loan remain unchanged, with (1) Unsecured Revolver borrowings bearing interest at a rate equal to either (i) the SOFR rate plus a margin of 72.5 to 140 basis points, or (ii) a base rate plus a margin of 0 to 40 basis points; and (2) 2028 Term Loan borrowings bearing interest at a rate equal to either (i) the SOFR rate plus a margin of 80 to 160 basis points, or (ii) a base rate plus a margin of 0 to 60 basis points. The applicable margin will be determined based upon IRT’s credit rating. At the time of closing, based on IRT’s credit rating along with IROP’s consolidated leverage ratio, the applicable SOFR margin was 77.5 basis points for the Unsecured Revolver and 85 basis points for both the 2026 Term Loan and 2028 Term Loan. Overall, this reflects a weighted average reduction in margin of approximately 34 basis points compared to the interest rate margins in place prior to IRT’s receipt of investment grade credit ratings.

Current wording

The margin for borrowings under the Unsecured Revolver, the 2028 Term Loan and the new 2030 Term Loan remain unchanged, with (1) Unsecured Revolver borrowings bearing interest at a rate equal to either (i) the SOFR rate plus a margin of 72.5 to 140 basis points, or (ii) a base rate plus a margin of 0 to 40 basis points; and (2) 2028 Term Loan and new 2030 Term Loan borrowings bearing interest at a rate equal to either (i) the SOFR rate plus a margin of 80 to 160 basis points, or (ii) a base rate plus a margin of 0 to 60 basis points. The applicable margin will be determined based upon IRT’s credit rating. At the time of closing, based upon IRT’s credit rating along with IROP’s consolidated leverage ratio, the applicable SOFR margin was 77.5 basis points for the Unsecured Revolver and 85 basis points for both the 2028 Term Loan and 2030 Term Loan.

Previous wording

The Fifth Restated Credit Agreement contains customary covenants for credit facilities of this type, including restrictions on our ability to take the following actions: (i) make distributions after an event of default; (ii) incur debt; (iii) make investments; (iv) grant or suffer liens; (v) undertake mergers, consolidations, asset sales and other fundamental entity changes; (vi) make material changes to contracts and organizational documents; and (vii) enter into transactions with affiliates.

Current wording

The Sixth Restated Credit Agreement contains customary covenants for credit facilities of this type, including restrictions on our ability to take the following actions: (i) make distributions after an event of default; (ii) incur debt; (iii) make investments; (iv) grant or suffer liens; (v) undertake mergers, consolidations, asset sales and other fundamental entity changes; (vi) make material changes to contracts and organizational documents; and (vii) enter into transactions with affiliates.

Previous wording

The Fifth Restated Credit Agreement also contains financial covenants applicable to us involving (i) maximum consolidated total debt to total asset value, (ii) maximum distributions, (iii) maximum secured debt to total asset value, (iv) maximum unsecured debt to eligible unencumbered properties, and (v) minimum consolidated fixed charge coverage. The Restated Credit Agreement provides for certain customary events of default, including among others, non-payment of principal, interest or other amounts when due, inaccuracy of representations and warranties, violation of covenants, cross defaults with certain other indebtedness, insolvency or inability to pay debts, bankruptcy, or a change of control.

Current wording

The Sixth Restated Credit Agreement also contains financial covenants applicable to us involving (i) maximum consolidated total debt to total asset value, (ii) maximum distributions, (iii) maximum secured debt to total asset value, (iv) maximum unsecured debt to eligible unencumbered properties, and (v) minimum consolidated fixed charge coverage. The Sixth Restated Credit Agreement provides for certain customary events of default, including among others, non-payment of principal, interest or other amounts when due, inaccuracy of representations and warranties, violation of covenants, cross defaults with certain other indebtedness, insolvency or inability to pay debts, bankruptcy, or a change of control.

Previous wording

On June 14, 2023, we replaced our previous shelf registration statement with our new shelf registration statement. On July 28, 2023, we entered into an equity distribution agreement pursuant to which we may from time to time offer and sell shares of our common stock under our shelf registration statement having an aggregate offering price of up to $450 million (the “2023 ATM Program”) in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act. Under the 2023 ATM Program, we may also enter into one or more forward sale transactions for the sale of shares of our common stock on a forward basis.

Current wording

On July 28, 2023, we entered into an equity distribution agreement pursuant to which we may from time to time offer and sell shares of our common stock under our shelf registration statement having an aggregate offering price of up to $450.0 million (the “ATM Program”) in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act. Under the ATM Program, we may also enter into one or more forward sale transactions for the sale of shares of our common stock on a forward basis.

Previous wording

During the three months ended September 30, 2024, and December 31, 2024, we entered into forward sale transactions under the 2023 ATM Program for the forward sale of an aggregate 2,498,300 shares of our common stock with a maturity date of September 5, 2025 or November 13, 2025, respectively, as set forth in the forward sale transactions placement notice. On December 30, 2024, we physically settled all of these 2,498,300 shares of our common stock at a weighted average price of $20.06 per share and we received proceeds of $50.1 million. As of December 31, 2024, approximately $399.4 million remained available for issuance under the 2023 ATM Program.

Current wording

During the three months ended March 31, 2025, we entered into forward sales transactions under the ATM Program for the forward sale of an aggregate of 2.7 million shares of our common stock at a weighted average price of $20.96 per share. On December 23, 2025, we net cash settled all 2.7 million shares of common stock at a weighted average price of $16.81 per share against a weighted average forward price of $21.02 per share, resulting in net proceeds to us of $11.3 million. We used substantially all of the net proceeds to fund the repurchase of shares of common stock under our Stock Repurchase Program. As of December 31, 2025, approximately $342.4 million remained available for issuance under our ATM Program.

Previous wording

On December 16, 2024, our board of directors declared a quarterly dividend of $0.16 per share of common stock, which was paid on January 17, 2025 to stockholders of record at the close of business on December 31, 2024.

Current wording

On December 15, 2025, our Board of Directors declared a quarterly dividend of $0.17 per share of common stock, which was paid on January 23, 2026 to stockholders of record at the close of business on December 31, 2025.