In This Article:
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Sales Per Square Foot: $910 excluding Eddy assets; $834 overall, down $1 from last quarter.
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Occupancy Rate: 95.4% excluding Eddy properties; 93.7% overall, up 40 basis points from the second quarter.
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Same-Store NOI: Increased 2.8% excluding Eddy assets; 1.9% overall.
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Traffic Increase: Up 2.4% compared to the third quarter last year; year-to-date up 1.6% from 2023.
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FFO Per Share: $0.38 for the third quarter, down from $0.45 in the third quarter of 2023.
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Leasing Activity: 220 leases signed for 830,000 square feet in Q3; year-to-date 2.6 million square feet.
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New Store Openings: 1 million square feet year-to-date; 225,000 square feet in Q3.
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Debt Reduction Target: $2 billion, with $1.17 billion completed or in progress.
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Available Liquidity: Approximately $667 million.
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Leverage Ratio: Reduced to 8.22 times from 8.76 times at year-end 2023.
Release Date: November 06, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Macerich Co (NYSE:MAC) reported continued improvement in operational results, with occupancy, leasing activity, and same-store NOI showing positive trends.
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The company is making significant progress on its Path Forward initiative, targeting a $2 billion reduction in long-term debt, with approximately 60% of this target already completed or in progress.
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Leasing volumes and metrics remain strong, with a 40% increase in deal flow compared to the same period last year, indicating robust retailer demand.
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Macerich Co (NYSE:MAC) successfully closed several acquisitions and dispositions, including the acquisition of a partner's interest in Pacific Premier Retail Trust, which is expected to be accretive to FFO per share.
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The company has a strong pipeline of new store openings, with 2.5 million square feet of new stores expected to open through early 2027, contributing $80 million of incremental rent.
Negative Points
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Sales per square foot decreased slightly, with comparative sales down about 1% from the third quarter of 2023, reflecting cautious consumer behavior.
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The macroeconomic environment remains challenging, with consumers focusing on essentials and showing caution in discretionary spending.
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Macerich Co (NYSE:MAC) will incur severance charges in the fourth quarter related to executive changes, resulting in a $0.02 reduction to fourth-quarter earnings.
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Interest expenses increased by $5 million due to rising rates, impacting quarterly FFO trends.
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The company faces challenges in re-leasing select vacant spaces, including former Forever 21 and Express locations, which are critical to achieving its NOI targets.