AvalonBay falls after BMO downgrades on rising costs and demand drop

Brokerage BMO Capital Markets downgrades apartment REIT AvalonBay AVB.N to "market perform" from "outperform"; PT unchanged at $220

Shares of AVB fall 4.5% to $196.81

Brokerage says AVB is expected to face higher development costs and weaker demand due to job cuts in the home market

Brokerage believes DOGE-related job cuts that affect people in Washington D.C. would lead to weaker demand during peak leasing season as co gets most of its net rental income from D.C. Metro / Baltimore region

AVB's $3.5 billion development pipeline faces rising headwinds as lumber tariffs will likely drive up construction costs and deportation pledge may increase labor costs, says brokerage

Ten out of 24 brokerages rate the stock "buy" or higher, 14 rate "hold" and their median PT is $238 as per data compiled by LSEG

Including session's moves, AVB stock down 9.7% YTD