• FFO (Funds From Operations): $0.52 per share in the third quarter.
• Same Property NOI Growth: 4.1% for the quarter.
• Base Rent Contribution to NOI Growth: Increased from 380 basis points last quarter to 520 basis points this quarter.
• Leasing Activity: 1.1 million square feet of new and renewal leases at a blended cash spread of 22%.
• Occupancy Rates: Overall occupancy at 95.6%, anchor occupancy at 97.7%, and small shop occupancy at 91.1%.
• Acquisitions: $64 million completed during the quarter, $81 million year to date.
• Dispositions: $143 million year to date.
• Reinvestment Deliveries: $33 million at a 10% yield in the quarter.
• Signed But Not Yet Commenced Pipeline: $59 million.
• Dividend Increase: Raised to an annual rate of $1.15, a 5.5% increase.
• 2024 FFO Guidance: Raised to a range of $2.13 to $2.15 per share.
• Liquidity: Total liquidity of $1.7 billion.
• Debt to EBITDA Ratio: 5.7 times on a current quarter annualized basis.

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Release Date: October 29, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Brixmor Property Group Inc (NYSE:BRX) reported strong financial performance with a 5% expected FFO growth for the second consecutive year.
• The company achieved record occupancy rates and sector-leading leasing spreads, indicating strong demand for their properties.
• Brixmor Property Group Inc (NYSE:BRX) successfully capitalized on tenant disruptions by bringing in better tenants at higher rents.
• The company has a robust pipeline of value-add acquisitions worth $250 million, indicating future growth potential.
• Brixmor Property Group Inc (NYSE:BRX) increased its dividend by 5.5%, reflecting confidence in its financial stability and growth prospects.

Negative Points

• The company incurred a one-time severance cost of $2.5 million due to regional realignment, impacting short-term financials.
• There is a potential headwind from revenues deemed uncollectible, which contracted 200 basis points from growth.
• Brixmor Property Group Inc (NYSE:BRX) faces challenges in maintaining occupancy levels as they recapture spaces from bankrupt tenants.
• The company is experiencing a slower transaction market, which could impact future acquisition and disposition activities.
• Brixmor Property Group Inc (NYSE:BRX) raised $20 million in equity through ATM issuance, which may dilute existing shareholders.

Q & A Highlights

Q: Can you comment on the investment market and the rationale for raising equity at this point? A: James Taylor, CEO: We see an improving outlook for external growth with about $250 million of assets under control that are accretive and cluster our investments in key markets. The market is healthy, with institutional interest in open-air retail increasing. We are leveraging our platform to drive growth and outperformance, which justifies the equity raise.

Q: Is the contribution from the signed but not commenced pipeline for 2025 evenly distributed or more back half-weighted? A: Brian Finnegan, President and COO: We are not seeing tenants push out commitments. The signed but not commenced pipeline remains strong, and 2025 is getting full for tenants, indicating robust demand. The pipeline provides good visibility on future growth.

Q: Should we expect the company to keep utilizing the ATM at current levels, and how will this affect acquisition and disposition activity? A: James Taylor, CEO: We plan to balance capital recycling with ATM issuance to fund acquisitions. We expect a ramp-up in acquisition activity, funded through a mix of dispositions and ATM issuance, maintaining a balanced approach over several quarters.

Q: With rising rates, do you think this will affect the transaction market, or has something changed? A: James Taylor, CEO: The market is slower but not due to rates or elections. We expect a healthy investment market, especially for smaller assets. We are not seeing a slowdown, and the market remains attractive for recycling assets.

Q: Can you discuss the opportunity for occupancy growth, particularly in the small shop space? A: James Taylor, CEO: We see continued opportunity for occupancy growth, driven by replacing lower rents with better tenants. The small shop space shows momentum, and we have visibility on growth due to our reinvestment pipeline. We expect to continue driving better occupancy and rates.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.