Release Date: February 14, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you provide an update on the leasing pipeline and the types of tenants involved? A: George Wells, Chief Operating Officer, explained that Piedmont achieved 2.4 million square feet of leasing in 2024. For 2025, they expect around 800,000 square feet of new deals, excluding a large transaction from 2024. The pipeline is strong with 300,000 square feet in late-stage activity and 2.6 million square feet in proposals, mainly from sectors like insurance, law, accounting, and engineering.
Q: How are you balancing acquisitions versus dispositions given the current market conditions? A: Brent Smith, CEO, stated that with no debt maturities until 2028, Piedmont is focusing on recycling capital by disposing of non-core assets and considering acquisitions. They are evaluating $200-300 million in assets, primarily opportunistic in nature, and may involve joint ventures to minimize balance sheet complexity.
Q: Can you comment on the acceleration in new leasing activity and the types of users involved? A: George Wells noted that new leasing activity is strong, with significant interest in Atlanta, Dallas, and Minneapolis. The pipeline includes 500,000 square feet of transactions in Minneapolis and 15 deals over 50,000 square feet. Sectors involved include technology, insurance, law, and professional services.
Q: Does the 1.4 to 1.6 million square feet of leasing guidance include any large renewals? A: Brent Smith confirmed that the guidance includes expected renewals, such as a significant New York City renewal. They are also working on backfilling space from known vacates like Evershed and Ryan, with positive leasing velocity.
Q: What are the prospects for net effective rent growth across the portfolio? A: Brent Smith indicated that net effective rent growth is already being pushed, especially in Sunbelt markets. While suburban Boston and Minneapolis are seeing flat to slightly positive growth, Northern Virginia is stable, and the district remains challenging with flat to negative growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.