S&P Global Market Intelligence presents a wrap-up of earnings conference calls May 1 and 2.
Public Storage pushes $500M acquisition guidance to H2'2024
Self-storage real estate investment trust Public Storage expects to achieve its $500 million acquisition guidance in the latter part of 2024 amid muted transaction market.
"[On our] 2024 guidance on acquisitions, we've pegged $500 million. Obviously, at this point in the year, it's going to be more back ended," Public Storage CEO Joseph Russell said.
H. Thomas Boyle, CFO and chief investment officer, said the transaction market for acquisitions remains subdued with limited volumes given a volatile cost of capital environment so far in 2024.
Despite this, the REIT remains optimistic of the pent-up interest for transaction activity, saying it's eager to participate when it occurs.
Read the call transcript and Dow Jones Newswires coverage.
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Boston Properties still sees office demand despite difficult market
Office REIT Boston Properties Inc. still sees demand for office space despite persistently high interest rates.
"In spite of the absence of a broad pickup in office-using jobs, BXP continues to lease space," Boston Properties President Douglas Linde said. "There are pockets of supply constrained in select submarkets where we are seeing competition for space and improving economics."
The REIT leased 893,000 square feet of space across 61 transactions in the first quarter, up 35% year-over-year. The leasing number comprises 32 new leases for 494,000 square feet and 29 renewals encompassing 399,000 square feet.
Read the call transcript.
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Marriott increases 2024 adjusted EPS guidance
Marriott International Inc. raised its adjusted earnings per share guidance in 2024 to between $9.31 and $9.65, from $9.18 to $9.52.
The hotel operator took into account its expectation of higher year-over-year revenue per available room (RevPAR) growth in Asia-Pacific, Europe, Middle East, Africa, Caribbean and Latin America and expected lower RevPAR growth in the US, Canada and Greater China.
"Our 2024 outlook still assumes continued sturdy travel demand and a continuation of current macroeconomic trends," Marriott CFO Kathleen Oberg said. "RevPAR growth is expected to remain higher in our international markets than in the US and Canada."
Read the call transcript and Dow Jones Newswires coverage.
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Extra Space books higher occupancy YOY
Self-storage REIT Extra Space Storage Inc. recorded higher occupancy in the first quarter.
Extra Space's same-store pool occupancy ended March at 93.2%, up 50 basis points from a year ago.
"Operationally, occupancy at the Extra Space same-store pool grew every month during a period normally recognized for seasonal declines," Extra Space CEO Joseph Margolis said.
The legacy Life Storage Inc. same-store pool occupancy saw a 220-basis-point year-over-year increase at 92% as of end-March.
Read the call transcript.
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Host Hotels adjusts 2024 EBITDAre guidance
Host Hotels & Resorts Inc. revised its earnings before interest, taxes, depreciation and amortization for real estate (EBITDAre) guidance in 2024 to a midpoint of $1.67 billion, up $35 million over the prior quarter.
The hotel REIT took into account an expected additional $8 million from business interruption proceeds related to Hurricane Ian, $20 million of business interruption proceeds related to the Maui wildfires, an estimated $62 million contribution from operations at Ritz-Carlton Naples, and $6 million from operations at Alila Ventana Big Sur.
Read the call transcript and Dow Jones Newswires coverage.
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Invitation Homes says more housing supply could improve affordability
"What we can do is our best to encourage that new supply coming into the market, which is why we're working with so many of our homebuilder partners, helping them start large new communities that often include a mix of for sale and for lease housing," Invitation Homes Inc. Co-Founder, CEO and Director Dallas Tanner told analysts when asked what could help improve housing affordability.
"There's 47 million households in the US that rent something somewhere. It's about 1/3 of the country. And it's been that way really for decades. And so it's also important to remember that -- we learn this from our residents. They tell us time and time again that they want choice and flexibility of leasing a home. And it's at a significantly lower cost than owing it," Tanner said.
Read the call transcript.
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Kimco expects acquisitions to pick up in second half
Kimco Realty Corp. expects its acquisition activity to increase during the second half of 2024.
"On the core acquisition front, we have maintained our disciplined approach to investing at a spread to our cost of capital. Asset pricing remains strong as we have seen major market infill grocery and high-quality convenience centers still trading at plus or minus 6% cap rates and in some cases, even below that. While this is a testament to the fundamental strength of the open-air retail platform, it has not been easy to find accretive opportunities through the first four months of the year," President and Chief Investment Officer Ross Cooper said.
"It just makes it very difficult for any investor that is looking for financing because there is a lag time between when you shake hands on a deal and when you actually go in and operate or close on that loan and the buyer and the seller expectations oftentimes change accordingly," Cooper said.
Read the call transcript.
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Essex sees encouraging signs in tech jobs recovery
Essex Property Trust Inc. President, CEO and Director Angela Kleiman said there are encouraging signs pointing to recovery in high-paying jobs, typically the key catalyst to accelerate demand for housing and rent growth.
"We are seeing anecdotally hybrid workers moving closer to the office to essentially trying to reduce the commute because traffic has picked up. We are seeing also the top 20 tech openings increasing, although it's very gradual," Kleiman said.
"What we're seeing is that the fundamentals are moving in the right direction. But in order for acceleration to occur, we really need to see a more robust pickup on the high-paying jobs. And we do believe that we have the fundamental backdrop for that to occur. It just it's all about when, and that's the big question on our mind," the executive said.
Read the call transcript and Dow Jones Newswires coverage.
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Mid-America Apartment expects stronger leasing environment in 2025
Mid-America Apartment Communities Inc. is expecting a stronger leasing environment in 2025 through at least 2028.
"We continue to make progress in putting our balance sheet capacity to work to deliver future earnings growth. Subsequent to quarter end, we started construction on a 302-unit pre-purchase development in Charlotte, North Carolina, and we expect to start construction this quarter on a 345-unit project under our pre-purchase development platform in the Phoenix, Arizona MSA," President and Chief Investment Officer Adrian Hill said. Both projects are expected to deliver first units by mid-2026.
"Despite the high level of new supply, we continue to see solid demand and absorption, leading to improved current occupancy with future exposure better than this time last year," Hill said.
Read the call transcript and Dow Jones Newswires coverage.
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Read the previous earnings calls wrap-up.
