In This Article:
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Sales per Square Foot: $837 at the end of Q4 2024, up $3 from the previous quarter.
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Occupancy Rate: 94.1% in Q4 2024, up 40 basis points from Q3 and 60 basis points year-over-year.
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New Store Openings: 1.5 million square feet in 2024.
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Leasing Volume: 3.7 million square feet of leases signed in 2024.
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FFO: Approximately $117 million or $0.07 per share in Q4 2024, down from $128 million or $0.57 per share in Q4 2023.
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Same-Center NOI: Decreased 0.4% in Q4 2024 compared to Q4 2023; increased 0.2% for the full year 2024 compared to 2023.
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Debt to EBITDA: Slightly below 8 times at year-end 2024, almost a full turn lower than the previous year.
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Liquidity: Approximately $683 million, including $540 million of capacity on the line of credit.
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Incremental Rent Pipeline: $66 million, with $27 million expected to be realized in 2025.
Release Date: February 27, 2025
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) has made significant progress in simplifying its business by consolidating joint venture interests and refinancing at favorable rates.
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The company has implemented a new leasing dashboard tool, improving visibility and efficiency in leasing and tenant coordination.
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Macerich Co (NYSE:MAC) achieved an 8.8% base rent re-leasing spread for permanent tenants under 10,000 square feet, with new leases signed at 17.6% higher base rent.
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The company's Path Forward Plan aims to increase physical permanent occupancy from 84% to 89% by 2028, with 50% of this increase already accounted for by the current SNO pipeline.
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Macerich Co (NYSE:MAC) has a strong pipeline of new store openings, totaling over 2 million square feet, expected to contribute $66 million in incremental rent by early 2028.
Negative Points
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The company experienced a decrease in FFO due to higher interest expenses and severance costs.
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Same-center NOI, excluding lease termination income, decreased by 0.4% in the fourth quarter of 2024 compared to the previous year.
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Macerich Co (NYSE:MAC) faces higher anticipated landlord work and tenant allowance costs due to a focus on new tenants.
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There is potential for delays in the development pipeline, particularly at FlatIron Crossing.
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The company is operating with a high debt-to-EBITDA ratio, although it has been reduced to slightly below 8 times.
Q & A Highlights
Q: Can you provide insights on the expected same-store NOI growth for 2025, considering the SNO pipeline? A: Jackson Hsieh, President and CEO, explained that while the SNO pipeline is expected to contribute significantly, the overall same-store NOI growth will be more flat in the next couple of years, with a more substantial increase anticipated in 2027 and 2028. The focus is on achieving leasing goals and improving tenant quality, which will eventually reflect in NOI growth.