Centerspace (NYSE: CSR) maps $245M asset sales, debt reduction and payouts
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Centerspace has completed a strategic review and approved a portfolio optimization and deleveraging plan built around approximately $240–245 million of apartment community sales in 2026. The plan covers twelve communities, including a full exit from the Bismarck and Rapid City markets and one Denver property, all currently under contract.
The company expects these dispositions to reduce total debt by $175–190 million, improve pro forma Net Debt to EBITDA from 8.2x in Q1 2026 to a sub‑7x level, and support potential special distributions of $45–65 million to shareholders and unitholders. Centerspace also declared a regular quarterly distribution of $0.77 per share/unit, payable July 14, 2026 to holders of record on June 29, 2026.
Recent non‑GAAP metrics highlight the current leverage profile. For the three months ended March 31, 2026, Net Operating Income was $39.5 million, Adjusted EBITDA was $31.6 million (annualized to $126.5 million), total debt was about $1.05 billion, and Net Debt to Adjusted EBITDA stood at 8.2x.
Positive
- Material deleveraging and capital return plan: Centerspace targets $175–190 million of debt reduction and outlines potential $45–65 million of special distributions, aiming to move Net Debt to EBITDA from 8.2x to sub‑7x while refocusing on larger, more liquid multifamily markets.
Negative
- None.
Insights
Centerspace plans sizable asset sales to cut leverage and fund possible special payouts.
Centerspace is pivoting its capital structure via about $240–245 million of planned property sales in 2026, exiting Bismarck and Rapid City and trimming Denver exposure. These assets are already under contract, which lowers execution risk though closings remain conditional.
Management targets debt reduction of $175–190 million, moving Net Debt to EBITDA from 8.2x in Q1 2026 to below 7.0x, while still keeping exposure to larger, more liquid markets. The company also outlines potential special distributions of $45–65 million, alongside its regular $0.77 quarterly distribution.
If completed, the plan would extend average debt maturity, increase the fixed‑rate mix, and boost liquidity, based on the pro forma table. Subsequent disclosures around actual sale proceeds, final leverage, and any special distribution declarations in the Q2 2026 earnings release will show how closely results track these expectations.
8-K Event Classification
3 items: 7.01, 8.01, 9.01
3 items
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Planned 2026 asset sales: $240–245 million
Expected debt reduction: $175–190 million
Potential special distributions: $45–65 million
+5 more
8 metrics
Planned 2026 asset sales
$240–245 million
Targeted dispositions of twelve communities in 2026
Expected debt reduction
$175–190 million
Debt paydown funded by planned dispositions
Potential special distributions
$45–65 million
Possible special payouts upon successful completion of sales
Pro forma leverage target
Sub-7.0x Net Debt / EBITDA
Expected level in Q4 2026 vs 8.2x in Q1 2026
Regular quarterly distribution
$0.77 per share/unit
Payable July 14, 2026 to holders of record June 29, 2026
Q1 2026 Net Operating Income
$39.5 million
NOI for three months ended March 31, 2026
Q1 2026 Adjusted EBITDA
$31.6 million
Adjusted EBITDA for three months ended March 31, 2026
Q1 2026 Net Debt / Adjusted EBITDA
8.2x
Net debt to annualized Adjusted EBITDA as of March 31, 2026
Key Terms
Net Operating Income, Adjusted EBITDA, Net Debt / Adjusted EBITDA, economic cap rate, +2 more
6 terms
Net Operating Income financial
"Net operating income $ 39,495 $ 41,985 $ 43,024 $ 42,018 $ 40,362"
Net operating income is the profit a business makes from its core operations after subtracting the costs directly related to running those operations, but before accounting for taxes, interest, or other expenses. It shows how efficiently a company is generating income from its main activities. Investors use this figure to assess the company's operational performance and profitability.
Adjusted EBITDA financial
"Adjusted EBITDA $ 31,626 $ 34,894 $ 35,231 $ 34,939 $ 32,636"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
Net Debt / Adjusted EBITDA financial
"Net debt / Adjusted EBITDA 8.2x 7.5x 7.9x 7.9x 7.3x"
Net debt / adjusted EBITDA measures how many years of a company’s recurring operating earnings would be needed to pay off its net debt, with net debt meaning total borrowings minus cash on hand and adjusted EBITDA meaning earnings from core operations after removing one-time or unusual items. Investors use it like a financial speedometer: a higher figure signals heavier leverage and less flexibility to weather setbacks, while a lower figure suggests stronger ability to manage and repay debt.
economic cap rate financial
"Planned Dispositions Pricing ~6.5% Economic Cap Rate(1)"
same store leasing spreads financial
"MAY OPERATIONAL UPDATE: LEASING TRENDS CONTINUE TO IMPROVE, SHOWING NORMAL SEASONAL PATTERNS"
special distributions financial
"That there may be special distributions of $45-65 million"
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 1, 2026
(Exact name of Registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip code)
(701 ) 837-4738
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed from last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 7.01 Regulation FD Disclosure.
On June 1, 2026, Centerspace (the “Company”) issued a press release relating to the outcome of the strategic review by its Board of Trustees (the “Board”). A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference. The press release will also appear on the Company’s website.
The investor presentation included as Exhibit 99.2 to this Current Report on Form 8-K was made available to investors beginning June 1, 2026. The presentation includes certain pro forma financial information about the Company. A copy of that investor presentation is furnished as Exhibit 99.2 and incorporated herein by reference.
The information set forth in this Item 7.01, including Exhibit 99.1 and 99.2, is being furnished pursuant to Item 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or under the Exchange Act, except as expressly provided by specific reference in such a filing.
Item 8.01 Other Events.
On June 1, 2026, the Company announced that the Board has, following a comprehensive evaluation of strategic alternatives, approved a portfolio optimization and deleveraging plan to enhance portfolio quality, strengthen the balance sheet, preserve embedded shareholder value, and maximize strategic flexibility. The plan includes approximately $240-245 million of targeted asset sales in 2026, comprising twelve communities, including a full exit from the Bismarck and Rapid City markets and one community in Denver. Each of these dispositions is under contract with buyers, and, subject to the satisfaction of certain closing conditions, the Company anticipates closing these sales in the second half of 2026.
The closing of the transactions described above may not occur on our expected timeline, or at all. We cannot assure you that the conditions set forth in any purchase agreement and the related transactions will be satisfied (or waived, if permitted) in a timely manner, or at all, or that an effect, event, development, or change will not transpire that could delay or prevent these transactions from closing.
Forward-Looking Statements
Certain statements in this Current Report on Form 8-K, including Exhibit 99.1, are based on the Company’s current expectations and assumptions, and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions, or other items related to the future. Forward-looking statements are typically identified by the use of terms such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” “assumes,” “may,” “projects,” “outlook,” “future,” and variations of such words and similar expressions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from the results of operations, financial conditions, or plans expressed or implied by the forward-looking statements. Although the Company believes the expectations reflected in its forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be achieved, including the risk that one or more of the contemplated transactions may not close on expected timelines or at all. Any statements contained herein that are not statements of historical fact should be deemed forward-looking statements. As a result, reliance should not be placed on these forward-looking statements as these statements are subject to known and unknown risks, uncertainties, and other factors beyond the Company’s control and could differ materially from actual results and performance. Such risks and uncertainties are detailed from time to time in filings with the Securities and Exchange Commission (“SEC”), including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, in its subsequent quarterly reports on Form 10-Q, and in other reports the Company files with the SEC from time to time. In addition, such risks, uncertainties, and other factors include, but are not limited to, the ability of the Company to complete the proposed dispositions on a timely basis, or at all; risks that the proposed dispositions disrupt current plans and operations; the impacts of the announcement or consummation of the proposed dispositions and outcome of the Board’s strategic review on business relationships; the anticipated costs related to the proposed dispositions; and the ability of the Company to realize the anticipated benefits of the proposed dispositions and the outcome of the Board’s strategic review. The
Company assumes no obligation to update or supplement forward-looking statements that become untrue due to subsequent events.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit | |||||
| Number | Description | ||||
99.1 | Press Release, dated June 1, 2026 | ||||
99.2 | Investor Presentation, dated June 1, 2026 | ||||
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL Document. | ||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Centerspace | ||||||||
| By | /s/ Anne Olson | |||||||
| Anne Olson | ||||||||
| Date: June 1, 2026 | President and Chief Executive Officer | |||||||
FOR IMMEDIATE RELEASE
Centerspace Announces Outcome of Strategic Review; $245 Million of Planned Dispositions
Company plans to dispose of approximately $245 million of assets in 2026, including a full exit from the Bismarck and Rapid City markets
Proceeds will be utilized to strengthen the balance sheet by significantly reducing leverage
Company declares a regular quarterly distribution of $0.77 per share/unit
MINNEAPOLIS, MN, June 1, 2026 – Centerspace (NYSE: CSR)(the “Company”) announced today that the Company’s Board of Trustees has, in connection with its comprehensive evaluation of strategic alternatives, approved a portfolio optimization and deleveraging plan designed to enhance portfolio quality, strengthen the balance sheet, preserve embedded shareholder value, and maximize strategic flexibility.
The Board and management engaged in a thorough process with a broad range of potential counterparties and assessed numerous alternatives. The actions announced today, subject to their completion, will strengthen the Company’s balance sheet while concentrating the portfolio in higher-quality, more liquid markets. The Company believes that upon their completion the transactions will position the Company for long-term success as multifamily fundamentals continue to recover following the elevated levels of supply delivered during 2023-2025.
The plan includes approximately $240-245 million of targeted assets sales in 2026, comprising twelve communities, including a full exit from the Bismarck and Rapid City markets and one community in Denver. Each of these dispositions is under contract with buyers and the Company anticipates closing these sales in the second half of 2026.
Upon successful completion of these dispositions, the Company currently expects:
•Total debt to decrease by $175-190 million, including repayment of the Company’s line of credit balance, improving both the cost and duration of debt;
•Improvement in proforma Annualized Net Debt to EBITDA, decreasing from 8.2x in Q1 2026 to an anticipated sub-7x level in Q4 2026; and
•That there may be special distributions of $45-65 million, with a declaration, if any, of exact timing and amount anticipated later in the year.
“The capital allocation initiative we are announcing today is an outcome of our review process. We expect these actions to enhance shareholder value by capturing the discount between public and private market valuations, while materially strengthening our balance sheet and positively evolving our market exposures,” said Centerspace CEO Anne Olson.
“The Board undertook this process with one objective: determining the best alternatives for maximizing value for our shareholders,” said Centerspace Board of Trustees Chair John Schissel. “We believe the approved plan will unlock intrinsic asset value, strengthen the balance sheet, create a more focused portfolio and preserve the flexibility to capture future value creation.”
The Company’s previously released earnings guidance did not contemplate any potential dispositions. While the Company’s operational outlook remains materially unchanged, it is still evaluating the impact of these transactions on financial results and plans to provide updated guidance in conjunction with its second quarter 2026 earnings release.
Centerspace’s Board of Trustees has declared a regular quarterly distribution of $0.77 per share/unit, payable on July 14, 2026, to common shareholders and unitholders of record at the close of business on June 29, 2026.
The closing of the transactions described above may not occur on the expected timeline, or at all. The Company cannot assure that the conditions set forth in any purchase agreement and the related transactions will be satisfied (or waived, if permitted) in a timely manner, or at all, or that an effect, event, development, or change will not transpire that could delay or prevent these transactions from closing.
About Centerspace
Centerspace is an owner and operator of apartment communities committed to providing great homes by focusing on integrity and serving others. Founded in 1970, as of March 31, 2026, Centerspace owned 61 apartment communities consisting of 12,263 homes located in Colorado, Minnesota, Montana, Nebraska, North Dakota, South Dakota, and Utah. Centerspace was named a Top Workplace in 2026 by USA TODAY and for the sixth consecutive year in 2025 by the Minnesota Star Tribune. For more information, please visit www.centerspacehomes.com.
Forward-Looking Statements
Certain statements in this press release are based on the Company's current expectations and assumptions, and are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions, or other items related to the future. Forward-looking statements are typically identified by the use of terms such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "will," "assumes," "may," "projects," "outlook," "future," and variations of such words and similar expressions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements to be materially different from the results of operations, financial conditions, or plans expressed or implied by the forward-looking statements. Although the Company believes the expectations reflected in its forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be achieved, including the risk that one or more of the contemplated transactions may not close on expected timelines or at all. Any statements contained herein that are not statements of historical fact should be deemed forward-looking statements. As a result, reliance should not be placed on these forward-looking statements as these statements are subject to known and unknown risks, uncertainties, and other factors beyond the Company's control and could differ materially from actual results and performance. Such risks and uncertainties are detailed from time to time in filings with the Securities and Exchange Commission ("SEC"), including the "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Risk Factors" contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2025, in its subsequent quarterly reports on Form 10-Q, and in other reports the Company files with the SEC from time to time. In addition, such risks, uncertainties, and other factors include, but are not limited to, the ability of the Company to complete the proposed dispositions on a timely basis, or at all; risks that the proposed dispositions disrupt current plans and operations; the impacts of the announcement or consummation of the proposed dispositions and outcome of the Board of Trustees’ strategic review on business relationships; the anticipated costs related to the proposed dispositions; and the ability of the Company to realize the anticipated benefits of the proposed dispositions and the outcome of the Board of Trustees’ strategic review. The Company assumes no obligation to update or supplement forward-looking statements that become untrue due to subsequent events.
###
Contact Information
Investor Relations
Josh Klaetsch
(952) 401-6600
IR@centerspacehomes.com
Marketing & Media
Kelly Weber
(952) 401-6600
kweber@centerspacehomes.com
centerspacehomes.com INVESTOR PRESENTATION June 1, 2026 MartinBlu Apartments – Eden Prairie, MN
centerspacehomes.com 2 Certain statements in this presentation are based on Centerspace’s current expectations and assumptions, and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements do not discuss historical fact, but instead include statements related to expectations, projections, intentions, or other items related to the future. Forward-looking statements are typically identified by the use of terms such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” “assumes,” “may,” “projects,” “outlook,” “future,” and variations of such words and similar expressions. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from the results of operations, financial conditions, or plans expressed or implied by the forward-looking statements. Although the Company believes the expectations reflected in its forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be achieved, including the risk that one or more of the contemplated transactions may not close on expected timelines or at all. Any statements contained herein that are not statements of historical fact should be deemed forward-looking statements. As a result, reliance should not be placed on these forward-looking statements, as these statements are subject to known and unknown risks, uncertainties, and other factors beyond the Company's control and could differ materially from actual results and performance. Such risks and uncertainties are detailed from time to time in filings with the Securities and Exchange Commission (“SEC”), including the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, in its subsequent quarterly reports on Form 10-Q, and in other reports the Company files with the SEC from time to time. In addition, such risks, uncertainties, and other factors include, but are not limited to, the ability of the Company to complete the proposed dispositions on a timely basis, or at all; risks that the proposed dispositions disrupt current plans and operations; the impacts of the announcement or consummation of the proposed dispositions and the outcome of the Board of Trustee’s strategic review on business relationships; the anticipated costs related to the proposed dispositions; and the ability of the Company to realize the anticipated benefits of the proposed dispositions and the outcome of the Board of Trustee’s strategic review. The Company assumes no obligation to update or supplement forward- looking statements that become untrue due to subsequent events. ADDITIONAL DISCLOSURES This presentation makes references to anticipated dispositions. There is no guarantee that these anticipated transactions will be completed, or that they will be completed at prices assumed within this presentation. Additionally, we have not provided a reconciliation of our Proforma Net Debt / Annualized EBITDA or our Proforma Net Operating Income because the information needed to reconcile these measures is unavailable due to the inherent difficulty of forecasting the timing or amount of various items that have not yet occurred and which may be excluded from Proforma Net Debt / Annualized EBITDA and Net Operating Income. Additionally, estimating such GAAP measure and providing a meaningful reconciliation for future periods requires a level of precision that is unavailable for these future periods and cannot be accomplished without unreasonable effort. Forward-looking non-GAAP measures are estimated consistent with the relevant definitions and assumptions used for historical non-GAAP measures. SAFE HARBOR STATEMENT & LEGAL DISCLOSURES
centerspacehomes.com 3 ➢ $175-190 million of expected debt reduction ➢ Expected repayment of outstanding line of credit balance, in addition to the paydown of other debt obligations ➢ $45-65 million of potential special distributions to shareholders and unitholders ➢ Plan expected to reduce financial risk and improve strategic flexibility BALANCE SHEET IMPROVEMENT AND CAPITAL RETURN STRATEGIC REVIEW OVERVIEW TARGETED PORTFOLIO OPTIMIZATION ➢ Board undertook comprehensive evaluation of strategic alternatives ➢ Approved plan to optimize portfolio, strengthen balance sheet, and preserve shareholder value ➢ Company maintains strategic flexibility ➢ $240-245 million of planned asset sales in 2026 ➢ 12 communities under contract, with closings anticipated in 2H 2026 ➢ Full exit from Bismarck, ND, and Rapid City, SD, markets ➢ One disposition in Denver STRATEGIC REVIEW OUTCOMES Meaningful leverage reduction and improved liquidity profile STRATEGIC REVIEW OUTCOMES: STRONGER BALANCE SHEET WITH ENHANCED FLEXIBILITY Portfolio focused on larger, more liquid markets Positioned to pursue growth as multifamily fundamentals continue to recover Reinforces embedded value of portfolio relative to public market valuation EXPECTED TRANSACTION IMPACT Asset Sales $240 – 245 million Markets Exited Bismarck and Rapid City Debt Reduction $175 – 190 million Pro Forma Leverage Sub-7.0x Net Debt to EBITDA Enhanced flexibility as balance sheet strengthens and structural constraints diminish
centerspacehomes.com 4 STRATEGIC REVIEW: SOURCES AND USES OF CAPITAL Metric Anticipated Transaction Impact Gross Disposition Proceeds $240-245 million Communities Sold 12 Markets Exited 2 Communities Sold in Top 50 MSAs 1 Expected Debt Paydown $175-190 million Potential Special Distributions $45-65 million Pro Forma Net Debt / EBITDA Sub-7.0x (1) Based on TTM SEC NOI as of 4/30/26 less $500/home capex and a management fee equal to 4% of revenue, based on expected transaction pricing (2) Based on TTM SEC NOI as of 10/30/25 less $500/home capex and a management fee equal to 4% of revenue, based on closing stock price on 11/10/2025 Planned dispositions total approximately $240-245 million, including a full exit from Bismarck, ND and Rapid City, SD markets, and one disposition in Denver Net proceeds expected to support $175-190 million of debt reduction, beginning with the repayment of the Company’s line of credit, and approximately $45-65 million of potential special distributions Disposition pricing compares favorably to the Company’s implied economic cap rate prior to strategic review announcement when considering vast majority of planned 2026 dispositions are located in higher cap rate secondary markets, highlighting the disconnect between private market asset values and public market valuation Plan provides a clear path to sub-7.0x pro forma Net Debt / EBITDA while maintaining exposure to larger and higher-conviction institutional markets The dispositions have been structured to balance meaningful deleveraging with preservation of long-term strategic flexibility Planned Dispositions Pricing ~6.5% Economic Cap Rate(1) CSR Stock Implied Pricing at 11/10/25 ~6.5% Economic Cap Rate(2) 12 communities currently under contract for sale, reducing execution risk and supporting expected completion of the dispositions in 2H 2026 Private Market vs. Public Market Pricing
centerspacehomes.com 5 0% 5% 10% 15% 20% 25% 30% 35% 40% Pro Forma Q1 2026 STRATEGIC REVIEW: PORTFOLIO REFINEMENT Note: multifamily only (1) Q1 2026 actual excluding sale communities (2) Monthly average scheduled rent divided by total number of apartment homes Q1 2026 Sales Pro Forma(1) Number of Communities 61 12 49 Number of Homes 12,263 1,495 10,768 Homes per Community 201 125 220 Average Monthly Rent(2) $1,660 $1,471 $1,687 % of NOI in 50 Largest MSAs 53% 10% 59% % of NOI by Market – Multifamily Only Improves portfolio homes per community, average monthly rent, and % of NOI in 50 largest MSAs Reduces North Dakota NOI concentration from 12.5% to 6.3% Exits Rapid City market which has the lowest homes per community and average monthly rents in portfolio Lowers exposure to urban Denver Sales result in a more efficient and higher-quality portfolio Sales Detail Region Number of Communities Number of Homes Homes per Community Average Monthly Rent(1) North Dakota 6 845 141 $1,527 Other Mountain West 5 474 95 $1,343 Denver, CO 1 176 176 $1,549 Total / Average 12 1,495 125 $1,471 (1) (1) Q1 2026 actual excluding sale communities (1) Monthly average scheduled rent divided by total number of apartment homes
centerspacehomes.com 6 STRATEGIC REVIEW: ACTIONS EXPECTED TO MEANINGFULLY REDUCE LEVERAGE % of Total Maturing 4.9% 4.5% 24.8% 9.0% 8.1% 18.6% 2.4% 7.5% 1.4% 8.2% 0.0% 10.6% Weighted Average Interest Rate (4) 3.5% 3.5% 4.1% 3.9% 2.6% 3.2% 2.7% 2.9% 2.8% 5.0% 0.0% 3.2% Well-Laddered Maturity Profile ($ amounts in thousands)(1,4) 6.0x 6.5x 7.0x 7.5x 8.0x 8.5x 9.0x Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2020 2021 2022 2023 2024 2025 2026 Quarterly Net Debt / Annualized Trailing EBITDA(1,3) 4-Quarter Moving Average Most Recent Quarter Metric Q1 2026 Pro Forma(1) Annualized Net Debt / EBITDA 8.2x Sub-7.0x Total Debt(2) $1.05 billion <$0.9 billion % of Debt Fixed Rate(2) 85.3% ~95% Liquidity (Cash + Credit Facility Availability) $260 million ~$375 million Weighted Average Interest Rate(4) 3.6% 3.4% Weighted Average Time to Maturity 6.7 years ~8 years Balance sheet improvement provides increased flexibility to support operations, future capital allocation, and growth as multifamily fundamentals recover (1) Pro Forma metrics are based on anticipated adjusted EBITDA and debt paydowns following the closing of all noted dispositions, using negotiated sale prices, and potential special distributions (2) Excludes premiums, discounts, and deferred financing costs (3) Net debt is the total outstanding debt balance less cash and cash equivalents. Adjusted EBITDA is annualized for periods less than one year. Net debt and adjusted EBITDA are non-GAAP financial measures and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition included with the Reconciliation to Non-GAAP Financial Measures section in the Appendix (4) Weighted average interest rate reflects interest expense only and excludes any facility fees, mortgage insurance premiums, or other associated expenses $50,955 $46,677 $60,000 $19,288 $144,901 $78,850 $86,086 $110,660 $429 $150,000 $50,000 $75,000 $85,000 $50,000 $25,000 $15,000 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037+ Mortgage LOC Private Placement Debt payoff focuses on 2026 maturities and LOC Debt expected to move below-7x following debt paydown
centerspacehomes.com 7 PRO FORMA CENTERSPACE: BETTER POSITIONED FOR LONG-TERM VALUE CREATION STRATEGIC REVIEW ACTIONS CREATE A MORE FOCUSED AND BETTER CAPITALIZED COMPANY WITH ENHANCED FLEXIBILITY TO DRIVE LONG-TERM SHAREHOLDER VALUE More Focused Portfolio Reduced exposure to smaller markets and lower-efficiency assets Stronger Balance Sheet Lower leverage, improved liquidity profile and reduced financial risk Clearer Capital Allocation Framework Debt reduction prioritized while satisfying potential distribution requirements Greater Strategic Flexibility Improved ability to evaluate future growth, reinvestment, and capital allocation opportunities Pro forma portfolio remains diversified across attractive Midwest and Mountain West markets
centerspacehomes.com 8 1.5% -3.4% -6.1% -2.1% 0.5% 2.7% 2.9% 3.9% 3.1% 3.3% 2.2% 0.7% -0.4% 0.4% 2.0% Q2 2025 Q3 2025 Q4 2025 Q1 2026 Q2 2026 QTD SAME STORE LEASING SPREADS(1) New Lease Rents Renewal Rents Blended Rents -2 .0 % -9 .3 % 1.5 % 2. 9% 0. 3% -0 .7 % 2. 3% -1 .0 % 2. 4% 1.3 % 3. 4% 5. 1% 2. 8% 3. 8% 3. 2% 3. 2% 0. 2% -4 .5 % 2. 5% 4. 0% 1.5 % 1.8 % 2. 8% 1.2 % YTD SAME STORE LEASING SPREADS BY REGION(1) New Lease Rents Renewal Rents Blended Rents MAY OPERATIONAL UPDATE: LEASING TRENDS CONTINUE TO IMPROVE, SHOWING NORMAL SEASONAL PATTERNS (1) Same store data represents the Same Store Pool as of Q1 2026. The pool is not adjusted to remove assets under contract for sale. Data represents 2026 Same Store pool Effective Rents. QTD leasing spreads and YTD leasing spreads are through May 27, 2026
centerspacehomes.com 9 RECONCILIATION TO NON-GAAP MEASURESRECONCILIATION TO NON-GAAP MEASURES Reconciliation of Operating Income to Net Operating Income Net operating income, or NOI, is a non-GAAP financial measure which the Company defines as total real estate revenues less property operating expenses, including real estate taxes. Centerspace believes that NOI is an important supplemental measure of operating performance for real estate because it provides a measure of operations that is unaffected by sales of real estate and other investments, impairment, depreciation, amortization, financing costs, including interest and other income, loss on extinguishment of debt, interest expense, property management expenses, casualty losses, loss on litigation settlement, and general and administrative expenses. NOI does not represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income (loss), net income (loss) available for common shareholders, or cash flow from operating activities as a measure of financial performance. (in thousands) Three Months Ended 3/31/2026 12/31/2025 9/30/2025 6/30/2025 3/31/2025 Operating income (loss) $ (5,393) $ (10,623) $ 77,210 $ (6,796) $ 4,746 Adjustments: Property management expenses 2,379 2,323 2,489 2,393 2,433 Casualty loss, net of recoveries (21) (242) 127 399 532 Depreciation and amortization 26,498 29,424 29,056 27,097 27,654 Impairment of real estate investments 9,700 14,500 8,676 14,543 - General and administrative expenses 6,332 6,542 4,997 4,382 4,997 (Gain) loss on sale of real estate and other assets - 61 (79,531) - - Net operating income $ 39,495 $ 41,985 $ 43,024 $ 42,018 $ 40,362
centerspacehomes.com 10 Reconciliation of Net Income (Loss) Available to Common Shareholders to Adjusted EBITDA Adjusted EBITDA is earnings before interest, taxes, depreciation, amortization, gain or loss on sale of real estate and other investments, impairment of real estate investments, gain or loss on extinguishment of debt, gain or loss from involuntary conversion, and other non-routine items or items not considered core to business operations. The company considers Adjusted EBITDA to be an appropriate supplemental performance measure because it permits investors to view income from operations without the effect of depreciation, financing costs, or non-operating gains and losses. Adjusted EBITDA is a non-GAAP financial measure and should not be considered a substitute for operating results determined in accordance with GAAP. RECONCILIATION TO NON-GAAP MEASURESRECONCILIATION TO NON-GAAP MEASURES (1) Consists of (gain) loss on investments and one-time professional fees (in thousands) Three Months Ended 3/31/2026 12/31/2025 9/30/2025 6/30/2025 3/31/2025 Adjusted EBITDA Net income (loss) attributable to controlling interests $ (12,889) $ (18,433) $ 53,783 $ (14,515) $ (3,734) Adjustments: Distributions to Series D preferred unitholders 57 57 109 160 160 Noncontrolling interests – Operating Partnership and Series E preferred units (2,141) (3,102) 9,197 (2,483) (643) Income (loss) before noncontrolling interests – Operating Partnership and Series E preferred units $ (14,973) $ (21,478) $ 63,089 $ (16,838) $ (4,217) Adjustments: Interest expense 10,470 11,537 12,989 10,719 9,622 Loss on extinguishment of debt - 95 3 - - Depreciation and amortization related to real estate investments 26,498 29,424 29,056 27,076 27,632 Impairment of real estate investments 9,700 14,500 8,676 14,543 - Non-cash casualty loss (recovery) (193) 229 (123) 149 282 Interest income (644) (757) (724) (729) (616) (Gain) loss on sale of real estate - 12 (77,280) - - Legal and other costs related to strategic review 977 1,336 - - - Other miscellaneous items(1) (209) (4) (455) 19 (67) Adjusted EBITDA $ 31,626 $ 34,894 $ 35,231 $ 34,939 $ 32,636
centerspacehomes.com 11 Net Debt Divided by Adjusted EBITDA Net debt is the total outstanding debt balance less cash and cash equivalents and net tax deferred proceeds held in restricted cash for exchanges under section 1031(b) of the Internal Revenue Code. Adjusted EBITDA is annualized for periods less than one year. Net debt and adjusted EBITDA are non-GAAP financial measures and should not be considered a substitute for operating results determined in accordance with GAAP. Refer to the Adjusted EBITDA definition on the previous slide. RECONCILIATION TO NON-GAAP MEASURESRECONCILIATION TO NON-GAAP MEASURES (1) Excludes premiums, discounts, and deferred financing costs (2) Annualized for periods less than one year (in thousands) Three Months Ended 3/31/2026 12/31/2025 9/30/2025 6/30/2025 3/31/2025 Total debt (1) $ 1,047,846 $ 1,053,909 $ 1,177,284 $ 1,121,292 $ 966,092 Less: cash and cash equivalents 7,555 12,833 12,896 12,378 11,916 Less: 1031 funds in restricted cash - - 50,941 - - Net debt $ 1,040,291 $ 1,041,076 $ 1,113,447 $ 1,108,914 $ 954,176 Adjusted EBITDA (2) $ 126,504 $ 139,576 $ 140,924 $ 139,756 $ 130,544 Net debt / Adjusted EBITDA 8.2x 7.5x 7.9x 7.9x 7.3x
FAQ
What strategic actions did Centerspace (CSR) announce in its latest 8-K?
Centerspace announced a portfolio optimization and deleveraging plan built around $240–245 million of planned asset sales in 2026. The strategy follows a broad strategic review and is intended to enhance portfolio quality, reduce leverage, and preserve flexibility for future capital allocation.
How much in property sales is Centerspace (CSR) planning to complete in 2026?
Centerspace plans approximately $240–245 million of asset sales in 2026, covering twelve apartment communities. The transactions include a full exit from the Bismarck and Rapid City markets and one community in Denver, all of which are currently under contract with buyers.
How will Centerspace (CSR) use proceeds from its planned dispositions?
Centerspace expects sale proceeds to reduce total debt by $175–190 million, including repayment of its line of credit, and to support potential special distributions of $45–65 million. Management frames the plan as balancing deleveraging with preserving long-term strategic flexibility for the portfolio.
What leverage targets did Centerspace (CSR) provide after its planned transactions?
Pro forma, Centerspace aims to reduce Net Debt to EBITDA from 8.2x in Q1 2026 to a sub-7.0x level once all planned dispositions close. The company also highlights higher fixed-rate debt, longer average maturities, and increased liquidity as expected balance sheet outcomes.
Did Centerspace (CSR) change its regular distribution in this update?
Centerspace’s Board declared a regular quarterly distribution of $0.77 per share or unit. The payment is scheduled for July 14, 2026, to common shareholders and unitholders of record at the close of business on June 29, 2026, consistent with its ongoing capital return program.
What recent financial metrics did Centerspace (CSR) disclose alongside the plan?
For the quarter ended March 31, 2026, Centerspace reported Net Operating Income of $39.5 million and Adjusted EBITDA of $31.6 million. Total debt was about $1.05 billion, net debt was $1.04 billion, and Net Debt to Adjusted EBITDA measured 8.2x on an annualized basis.
Are Centerspace’s (CSR) planned dispositions guaranteed to close as described?
No. While the 12 communities are under contract, Centerspace cautions that closings depend on satisfying purchase agreement conditions. The company notes that timing or completion of the transactions may differ from expectations, and one or more deals may not close at all.