In This Article:
-
Total Revenue: Approximately $55 million.
-
Net Operating Income (NOI): Approximately $44 million.
-
Net Loss Attributable to Common Shareholders: Approximately $24.4 million or $0.67 per share.
-
Same Store Cash NOI: Approximately $42 million, an 8.9% decrease compared to the same quarter last year.
-
Adjusted Funds From Operations (AFFO): Approximately $23.1 million or $0.58 per share on a fully diluted basis.
-
Cash Balance: Approximately $242 million.
-
Total Liquidity: Approximately $399 million.
-
Total Debt Outstanding: Approximately $1.2 billion.
-
Net Debt: Approximately $941 million.
-
Weighted Average Interest Rate: 3.95%.
-
Net Debt to Normalized EBITDAre Ratio: 6.2 times.
-
Dividend Paid: $0.225 per common share.
Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Successfully amended and extended the credit facility, lowering borrowing costs and extending debt maturities.
-
Achieved 100% economic occupancy in the industrial segment with a weighted average lease term (WALT) of 6.3 years.
-
Executed a 10-year lease extension in the industrial segment with a significant 41% GAAP and 20% cash re-leasing spread.
-
Strong liquidity position with $399 million in total liquidity, supporting industrial growth initiatives.
-
Positive leasing outcomes with favorable re-leasing spreads, indicating strong demand for properties.
Negative Points
-
Reported a net loss attributable to common shareholders of $24.4 million, including a $43 million non-cash impairment.
-
Same-store cash NOI decreased by 8.9% compared to the same quarter last year.
-
The other segment still accounts for 10% of portfolio ABR, with remaining assets yet to be sold.
-
Limited control over the timing of asset sales in the other segment, which may affect financial outcomes.
-
The industrial segment faces minor headwinds in supply in specific markets, impacting expansion plans.
Q & A Highlights
Q: Can you discuss the hurdles and benchmarks for your industrial expansion plans? A: Michael Escalante, President and CEO, explained that the company has been focusing on deleveraging to a 6:1 debt to EBITDA ratio, achieving a 5.9 times ratio recently. They are generating positive cash flow and outperforming market expectations in office valuations. The company is preparing to lean towards industrial expansion, seeing favorable fundamentals despite minor supply-side headwinds. They have a sustainable capital structure and are actively looking for opportunities with normalized cap rates and fixed debt costs.